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EXHIBIT 10.1



EXECUTION COPY




STOCK PURCHASE AGREEMENT




     THIS STOCK PURCHASE AGREEMENT (this
“Agreement”) is made as of August 7, 2006 by and among Century Theatres, Inc., a California
corporation (the “Company”), Century Theatres Holdings, LLC, a California limited liability
company (“CTH LLC”), Syufy Enterprises, LP, a California limited partnership
(“Shareholder”), Cinemark USA, Inc., a Texas corporation (“Purchaser”) and Cinemark
Holdings, Inc., a Delaware corporation (“Holdings”).



RECITALS




     WHEREAS, as of the date of this Agreement, CTH LLC owns all of the issued and outstanding
shares of capital stock of the Company (the “Shares”) and Shareholder owns all of the
limited liability company interests of CTH LLC;



     WHEREAS, in accordance with the terms of this Agreement and prior to the Closing, CTH LLC will
distribute all of the Shares to Shareholder and will then dissolve, and immediately after such
distribution and dissolution, as a result thereof, Shareholder will own all of the Shares;



     WHEREAS, at the Closing, except for the Rollover Shares, Shareholder desires to sell to
Purchaser, and Purchaser desires to purchase from Shareholder, the Shares, upon the terms and
subject to the conditions set forth in this Agreement (the “Share Purchase”); and



     WHEREAS, in connection with the Share Purchase, Shareholder will contribute the Rollover
Shares to Holdings in exchange for shares of Holdings Stock as contemplated in Section
2.1(b) (the “Rollover”).



     NOW, THEREFORE, in consideration of the premises and the mutual terms, conditions and
agreements set forth herein, the parties hereto hereby agree as follows:



ARTICLE I

DEFINITIONS




     Section 1.1 Defined Terms. The following terms, as used herein, shall have the
following meanings:



     “Action” shall mean any litigation, suit or binding arbitration by or before any
Governmental Authority, including any civil, criminal or administrative claim, demand, proceeding,
binding arbitration, hearing or, to the Knowledge of the Company, investigation.



     “Affiliate” shall mean, with respect to any Person, any other Person which directly or
indirectly controls, is controlled by, or is under common control with such Person. For the
purposes of this definition, “control” (including the terms “controlled by” and “under common
control with”), with respect to the relationship between or among two or more Persons, shall mean
the possession, directly or indirectly, of the power to direct or cause the direction of the
affairs or management of a Person, whether through the ownership of voting securities, by
agreement or otherwise.



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     “Affiliated Group” shall mean an affiliated group as defined in Code §1504 (or any
analogous combined, consolidated or unitary group defined under state, local or foreign income Tax
law).



     “Agreement Date Salary Schedule” shall mean a schedule of the base salaries in effect
as of the date hereof with respect to any Eligible Employee as of the date hereof.



     “AIP Employee” shall mean an employee of the Company or any of its Subsidiaries
eligible to receive an annual cash incentive payment pursuant to the Annual Incentive Plan.



     “Alternative Transaction” shall mean any (i) reorganization, dissolution, liquidation,
refinancing or recapitalization of or involving CTH LLC, the Company or any of its Subsidiaries,
(ii) merger, consolidation, share exchange or acquisition of or involving CTH LLC, the Company or
any of its Subsidiaries, (iii) sale of any material amount of assets of CTH LLC, the Company or any
of its Subsidiaries, (iv) sale or issuance of capital stock or other equity interests of CTH LLC,
the Company or any of its Subsidiaries, (v) similar transaction or business combination involving
CTH LLC, the Company or any of its Subsidiaries or their respective businesses or capital stock (or
other equity interests) or assets or (vi) other transaction the consummation of which would
prevent, impede or delay the consummation of the Contemplated Transactions; provided that
the CTH LLC Transactions shall be deemed not to be an Alternative Transaction.



     “Annual Incentive Plan” shall mean the Century Theatres Annual Incentive Plan Fiscal
Year 2006.



     “Audit Calculation Method” shall have the meaning set forth on Section 6.17 of
the Company Disclosure Schedule.



     “Aurora Lease” shall mean the Lease Agreement, dated as of August 20, 1997, between
Corporate Property Investors and Century Theatres, Inc.



     “Backstop Senior Credit Facilities” shall have the meaning set forth in the Company
Debt Financing Commitment Letter.



     “Broker” shall mean any broker, agent, investment banker, financial advisor or
consultant providing services to any Person.



     “Business Day” shall mean any day that is not a Saturday, a Sunday or other day on
which banks are required or authorized by Law to be closed in San Francisco, California.



     “Change of Control Payments” shall mean (i) the aggregate amount of payments due or to
become due (whether or not automatically or upon the occurrence of the Closing) to any employee of
the Company or its Subsidiaries in connection with the consummation of the Contemplated
Transactions pursuant to this Agreement or any Contract, plan, understanding or arrangement to
which the Company or any of its Subsidiaries is a party or sponsor (including the
LTIP), excluding any amounts deducted from such payments from withholdings or taxes under
subsections (ii) or (iii), plus (ii) any withholding Taxes with respect to such amounts, plus (iii)



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any social security, medicare, unemployment or other payroll taxes payable by the Company or its
Subsidiaries with respect to such amounts.



     “Closing Date” shall mean the date of the Closing.



     “Code” shall mean the Internal Revenue Code of 1986, as amended and the regulations
thereunder.



     “Common Stock” shall mean the common stock, par value $0.001 per share, of the
Company.



     “Company Material Adverse Effect” shall mean any change, effect, event, occurrence,
state of facts or development that is, or is reasonably expected to be, materially adverse to the
business, properties, assets, liabilities, financial condition or results of operations of the
Company and its Subsidiaries, taken as a whole. Notwithstanding the foregoing, none of the
following changes, effects, events, occurrences, states of facts or developments shall be deemed
(either alone or in combination) to constitute, and none of the following shall be taken into
account in determining whether there has been a Company Material Adverse Effect or whether a
Company Material Adverse Effect would reasonably be expected to occur: changes, effects, events,
occurrences, states of facts or developments (a) relating to or resulting from economic conditions
in general in the United States or the global economy or capital or financial markets generally,
(b) relating to or resulting from changes in any Law, (c) relating to any change in the accounting
requirements applicable to the Company or its Subsidiaries, (d) relating to or resulting from
changes generally in the industry or markets in which the Company and its Subsidiaries operate
unless such changes disproportionately impact the Company and its Subsidiaries or the Company’s
Business relative to other companies in the Company’s and its Subsidiaries’ industry, (e) resulting
from general increases in the costs of construction in any market or markets in which the Company
conducts business, including the construction of Pipeline Theaters, (f) resulting from the
execution or announcement of this Agreement or the pendency of the Contemplated Transactions,
including any loss of employees, but specifically excluding any Event of Default (as defined under
the Credit Agreement) resulting from the execution of this Agreement and any actions taken by the
lenders under the Credit Agreement as a result thereof, (g) resulting from the Company’s compliance
with the covenants set forth in Article VI, including the Company’s taking of any action or
determination to take any action pursuant to any directive of Purchaser under Article VI,
and (h) except for the termination or expiration of the waiting period under the HSR Act, resulting
from the failure to obtain any third party consents or approvals.



     “Company’s Business” shall mean the business conducted by the Company and its
Subsidiaries, taken as a whole.



     “Company Disclosure Schedule” shall mean the Company Disclosure Schedule attached
hereto as Schedule A.



     “Company Proprietary Software” shall mean all computer software, not licensed to the
Company by a Person pursuant to a written license agreement set forth on Section 3.12(xv)
of the Company Disclosure Schedule, the unavailability of which would reasonably be expected to



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result in a Company Material Adverse Effect, including, without limitation, ACTS2, Century Purchase
Request, the Theatre Suite Application Time Clock, and the Theatre Film Web Scheduler.



     “Confidentiality Agreement” shall mean the Confidentiality Agreement dated April 6,
2005, between Purchaser and Shareholder.



     “Construction Purchase Orders” shall mean purchase orders or Contracts entered into
for the design, construction, inspection or equipping of any theatre (including Pipeline Theaters)
owned or operated by the Company or to be constructed by the Company; but shall not include
Pipeline Construction Agreements or Pipeline Architectural Agreements.



     “Contemplated Transactions” shall mean the Share Purchase, the Rollover and the other
transactions expressly required to be performed by this Agreement.



     “Contract” shall mean with respect to any Person, any written or, to the Knowledge of
such Person, oral contract, lease, license or other agreement that is legally binding on such
Person or to which such Person is a party.



     “Contribution and Exchange Agreement” shall mean the Stock Contribution and Exchange
Agreement, dated as of the date hereof, by and between Holdings, Cinemark, Inc., a Delaware
corporation, CTH LLC, and Shareholder, in the form attached hereto as Exhibit A.



     “Continuing Employees” shall mean any Person who was employed by the Company or its
Subsidiaries immediately prior to the Closing and who remains employed by the Company or its
Subsidiaries after the Closing or who becomes employed by the Purchaser or its Subsidiaries after
the Closing Date.



     “Credit Agreement” shall mean that certain Credit Agreement, dated March 1, 2006, by
and between Century California Subsidiary, Inc., Morgan Stanley & Co. Incorporated and the other
parties thereto.



     “CTH LLC Transactions” shall mean, collectively, (i) the distribution by CTH LLC to
Shareholder of all the Shares and (ii) the dissolution of and liquidation of CTH LLC.



     “Default” shall have the meaning set forth in the Company Debt Financing Commitment
Letter.



     “Eligible Employee” shall mean any employee of the Company or any of its Subsidiaries
eligible to receive a payment or benefit under the Severance Plan to be approved and adopted by the
Company pursuant to Section 6.17(a); provided that no LTIP Employee shall also be an
Eligible Employee.



     “Environmental Laws” shall mean all Governmental Orders and Laws enacted or otherwise
created by any Governmental Authority and all common law that govern, regulate or
otherwise affect the environment or the release, use, generation, handling, treatment,
storage, transport, and disposal of Hazardous Materials, including, but not limited to, the Federal
Clean Air Act, the Federal Clean Water Act, the Federal Resource Conservation and Recovery Act, the



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Federal Comprehensive Environmental Response, Compensation and Liability Act as amended, the
Federal Toxic Substances Control Act and their state counterparts.



     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.



     “event of default” when referred to as arising under any agreement shall have the
meaning given that term in such agreement.



     “Event of Default” shall have the meaning set forth in the Company Debt Financing
Commitment Letter.



     “Existing Administrative Agent” shall have the meaning set forth in the Company Debt
Financing Commitment Letter.



     “Fandango” shall mean Fandango, Inc., a Delaware corporation.



     “Fandango Shares” shall mean all shares of common stock of Fandango owned by the
Company as of the opening of business on the Closing Date.



     “Fee Properties” shall mean all of the Real Property owned by the Company or its
Subsidiaries in fee simple and which are listed in Section 3.13(a) of the Company
Disclosure Schedule, including the land, all buildings, structures, improvements and fixtures
located thereon, and all easements and appurtenances thereto or any interest therein.



     “Film Master License Agreements” shall mean any and all agreements pursuant to which
the Company licenses films for theatrical exhibition.



     “Furnishings” shall mean office furnishings, including furniture, accessories, books
and computers.



     “GAAP” shall mean United States generally accepted accounting principles and practices
as applied in the preparation of the Latest Audited Balance Sheet.



     “Governing Document” shall mean any charter, articles, bylaws, certificate, operating
agreement, partnership agreement, limited liability company agreement, regulations or similar
document adopted, filed or registered in connection with the creation, formation, organization or
governance of an entity.



     “Governmental Authority” shall mean any United States federal, state or local, or any
foreign governmental, regulatory, legislative, administrative, policing or taxing authority, agency
or commission or any court, tribunal, or judicial or arbitral body of any of the foregoing.



     “Governmental Authorization” shall mean any consent, license, permit, approval, or
registration issued or granted by any Governmental Authority or pursuant to any Law;
provided
that, any consent that may be required by a Governmental Authority as a party to an agreement
acting in such Governmental Authority’s proprietary capacity rather than its regulatory capacity
shall be deemed not to be a Governmental Authorization.



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     “Governmental Order” shall mean any order, writ, judgment, injunction, decree, written
notice, stipulation, determination or award of any kind or nature entered by or with any
Governmental Authority.



     “Hazardous Materials” shall mean the existence in any form of polychlorinated
biphenyls, asbestos or asbestos containing materials, urea formaldehyde foam insulation, oil,
gasoline, petroleum, petroleum products and petroleum-derived substances (other than in vehicles or
machinery operated in the ordinary course of business), pesticides and herbicides, and any other
chemical, waste, material or substance as to which standards of conduct or liability may be imposed
under any Environmental Laws.



     “Holdings Registration Agreement” shall mean that certain Registration Agreement,
dated as of the date hereof, by and between Holdings, Shareholder, CTH LLC, Madison Dearborn
Capital Partners IV, L.P., and the other shareholders of Holdings party thereto.



     “Holdings Stock” shall mean that certain Class A Common Stock of Holdings having the
rights set forth in that certain Certificate of Incorporation of Holdings, as in effect immediately
prior to the Closing.



     “Holdings Stockholders Agreement” shall mean that certain Stockholders Agreement,
dated as of the date hereof, by and between Holdings, Shareholder, CTH LLC, Madison Dearborn
Capital Partners IV, L.P., and the other shareholders of Holdings party thereto.



     “HSR Act” shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.



     “Income Tax” means any federal, state, local, or foreign Tax imposed on or measured by
gross or net income, including any interest, penalty or addition thereto.



     “Income Tax Return” means any Tax Return relating to Income Taxes, including any
schedule or attachment thereto and any amendment thereof.



     “Indebtedness” shall mean with respect to any Person: (A) indebtedness for borrowed
money (including all obligations of the Company or its Subsidiaries with respect to the Credit
Agreement); (B) indebtedness evidenced by notes, bonds, debentures or similar instruments; (C) all
obligations of such Person as lessee under the leases that have been or should be, in accordance
with GAAP, recorded as capital leases; (D) the deferred purchase price of property or services
incurred outside the ordinary course of business; (E) conditional sale or other title retention
agreements with respect to property acquired by such Person (even though the rights and remedies of
the seller or lender under such agreement in the event of default are limited to repossession or
sale of such property); (F) reimbursement obligations, whether contingent or matured, with respect
to letters of credit, bankers’ acceptances, surety bonds, other financial guarantees and interest
rate protection agreements (without duplication of other indebtedness supported or guaranteed
thereby); (G) all accrued and unpaid interest on any of the foregoing;
and (H) all Indebtedness of others referred to in clauses (A) through (G) above guaranteed
directly or indirectly in any manner by such Person.



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     “Intellectual Property” shall mean all rights arising from or in respect of the
following: (i) patents and patent applications; (ii) trademarks, service marks, trade names,
corporate names, brand names, and Internet domain names; (iii) copyrights and copyrightable works;
(iv) applications and registrations for any of the foregoing; (v) trade secrets, inventions,
know-how and confidential information; and (vi) computer software (including but not limited to
source code, executable code, data, databases and documentation); and (vii) all other intellectual
property similar to the foregoing.



     “Knowledge” shall mean (a) with respect to Purchaser or Holdings, the actual knowledge
(without independent inquiry) of the executive officers of Purchaser or Holdings, respectively and
(b) with respect to the Company and its Subsidiaries, the actual knowledge (without independent
inquiry) of the persons listed on Schedule C.



     “Law” shall mean any binding Federal, state, local, municipal or foreign constitution,
treaty, statute, law, ordinance, regulation, rule, code or order.



     “Leased Non-Pipeline Properties” shall mean all leasehold or subleasehold estates and
other rights of the Company or its Subsidiaries, to use or occupy the Real Property listed in
Section 3.13(a) of the Company Disclosure Schedule.



     “Leased Pipeline Properties” shall mean all leasehold or subleasehold estates and
other rights of the Company or its Subsidiaries, to use or occupy the Real Property listed in
Section 3.13(a) of the Company Disclosure Schedule.



     “Leased Properties” shall mean the Leased Non-Pipeline Properties and the Leased
Pipeline Properties.



     “License Agreement” shall mean the license agreement attached as Exhibit E
hereto between the Company and Shareholder.



     “Liens” shall mean all pledges, liens, mortgages, security interests, or encumbrances.



     “Loan Documents” shall have the meaning set forth in the Credit Agreement.



     “LTIP” shall mean, collectively, (i) the Century Theatres, Inc. Long Term Incentive
Plan for General Participants—Plan 04-05-06 et seq., as amended, (ii) the Century Theatres, Inc.
Long Term Incentive Plan for Executive Participants—Plan 04-05-06 et seq., as amended and (iii) the
Century Theatres, Inc. Long Term Incentive Plan for Senior Participants—Plan 04-05-06 et seq., as
amended.



     “LTIP Employee” shall mean any employee of the Company or any of its Subsidiaries
eligible to receive a payment or benefit under the LTIP.



     “LTIP Payment” shall mean, with respect to an LTIP Employee, the amount set forth
across from such LTIP Employee’s name on Section 3.17(f) of the Company Disclosure
Schedule.



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     “Non-Competition and Non-Disclosure Agreement” shall mean the non-competition and
non-disclosure agreement by and between the Non-Competition Parties and the Company, a copy of
which is attached as Exhibit B hereto.



     “Non-Competition Parties” shall mean the Shareholder, Raymond W. Syufy and Joseph
Syufy.



     “Non-Income Tax” means any Tax that is not an Income Tax, including any interest,
penalty or addition thereto.



     “Non-Income Tax Return” means any Tax Return relating to Non-Income Taxes, including
any schedule or attachment thereto and any amendment thereof.



     “Northgate Lease” shall mean the Lease Agreement, dated as of October 22, 1993,
between Northgate Mall Associates and Vista Theatres, Inc., as amended.



     “Northglenn Lease” shall mean the Ground Lease, dated November 18, 2004, between The
City of Northglenn, as landlord, and Century Theatres NG, LLC, as tenant, for the lease of certain
property located at East Side of Grant Street at approximately 119th Avenue Northglenn,
Colorado.



     “ordinary course of business” shall mean the ordinary course of business of the
Company or its Subsidiaries, as applicable, consistent with past practice, including all elements
relating to the development and construction of the Pipeline Theaters.



     “Party” shall mean (a) prior to the Closing, Shareholder, CTH LLC, the Company and its
Subsidiaries, collectively, on the one hand, and Purchaser and Holdings, on the other, and (b)
after the Closing, Shareholder, on the one hand, and Purchaser, Holdings, the Company and its
Subsidiaries, collectively, on the other.



     “Permitted Liens” shall mean (a) inchoate Liens imposed for construction work in
progress or otherwise incurred in the ordinary course of the Company’s Business, (b) mechanics’,
workmen’s and repairmen’s Liens (other than inchoate Liens for work in progress) incurred in the
ordinary course of business for sums not yet delinquent or being contested in good faith, (c)
easements, reservations, covenants, conditions, restrictions or other matters of (i) public record
or disclosed in the Company’s existing title policies or in the Real Property Leases (including any
annexes, attachments, schedules or exhibits thereto) or (ii) as would be disclosed on current title
reports or surveys, (d) Liens for Taxes and general and special assessments not yet due and payable
or, with respect to any property located in California, not yet delinquent, (e) rights of way and
restrictions (including zoning and land use regulations) imposed by Law, (f) to the extent they are
not, and would not reasonably be expected to be, material: unpatented mining claims; reservations
or exceptions in patents or in acts authorizing the issuance thereof; water, mineral or gas rights,
claims, or title to such, whether or not such matters are shown by the
public records and (g) with respect to the Leased Properties, the terms and conditions of the
applicable Real Property Leases made available to Purchaser.



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     “Person” shall mean an individual, corporation, partnership, limited liability
company, association, trust or other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.



     “Per Share Purchase Price” shall be an amount equal to (i) the Purchase Price, divided
by (ii) the aggregate number of Shares (including Rollover Shares).



     “Pipeline Architectural Agreements” shall mean the architectural agreements entered
into by the Company for the completion of construction drawings for certain Pipeline Theaters. A
list of the Pipeline Architectural Agreements is included in Section 3.13(c) of the Company
Disclosure Schedule.



     “Pipeline Construction Agreements” shall mean the construction agreements and related
change orders entered into by the Company for the construction of certain Pipeline Theaters. A
list of the Pipeline Construction Agreements is included in Section 3.13(c) of the Company
Disclosure Schedule.



     “Pipeline Theaters” shall mean theaters identified as such in Section 3.13(c)
of the Company Disclosure Schedule.



     “Pre-Audit Calculation Method” shall have the meaning set forth on Section
6.17 of the Company Disclosure Schedule.



     “Pro-Rata Calculation Method” shall have the meaning set forth on Section 6.17
of the Company Disclosure Schedule.



     “Purchaser Disclosure Schedule” means the Purchaser Disclosure Schedule attached
hereto as Schedule D.



     “Purchaser Expenses” shall mean all out-of-pocket expenses (including all filing fees,
fees and expenses of counsel, accountants, investment bankers, financial advisors, lenders,
experts, actuaries, consultants and other providers to a party or its Affiliates) incurred by
Purchaser, Holdings or their respective Affiliates or on their behalf in connection with or related
to the authorization, preparation, negotiation, execution or performance of this Agreement and the
Contemplated Transactions.



     “Real Estate Broker” shall mean the brokers party to the real estate brokerage
agreements set forth on Section 3.13(b) of the Company Disclosure Schedule.



     “Real Property Leases” shall mean the real estate leases and subleases or other
similar agreements (each as amended) to which the Company or one of its Subsidiaries is a party and
pursuant to which the Company or one of its Subsidiaries occupies and/or operates the Leased
Properties for the conduct of the Company’s Business. For the avoidance of doubt, the Terminating
Syufy Lease Amendments shall not be Real Property Leases. Furthermore, for the avoidance of doubt,
the profits and losses participation agreement (the “Winchester Agreement”)
relating to any of the properties located at 3161 Olsen Drive, 3162 Olin Avenue and 3164 Olsen
Drive, each in San Jose, California, shall not be a Real Property Lease.



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     “Representative” shall mean, with respect to a particular Person, any director,
officer, manager, employee, agent, consultant, advisor, legal counsel, accountant, investment
banker, broker, lender or other representative of that Person.



     “Required Lenders” shall have the meaning set forth in the Credit Agreement.



     “Rollover Amount” shall mean an amount equal to One Hundred and Fifty Million Dollars
($150,000,000).



     “Rollover Shares” shall mean the number of Shares equal to the Rollover Amount divided
by the Per Share Purchase Price.



     “Sams Town Lease” shall mean the Lease Agreement, dated as of July 15, 1999, between
California Hotel and Casio and Century Theatres, Inc., as amended.



     “Securities Act” shall mean the Securities Act of 1933 and the rules and regulations
promulgated thereunder, in each case, as amended from time to time.



     “Seller Transaction Expenses” shall mean all out-of-pocket expenses (including all
filing fees, costs, fees and expenses of counsel, accountants, investment bankers, financial
advisors, lenders, experts, actuaries, consultants and other service providers to a party or its
Affiliates) incurred by the Company, its Subsidiaries, CTH LLC or Shareholder, or on their behalf,
in connection with, or related to, the authorization, preparation, negotiation, execution or
performance of this Agreement and the Contemplated Transactions (whether paid or unpaid prior to
the Closing). For the avoidance of doubt, any filing fee to be paid in connection with any HSR
notification required in connection with the Contemplated Transactions, including the Rollover,
shall not be a Seller Transaction Expense.



     “Seller Financing Expenses” shall mean (A) the payment or incurrence of Default
Interest under the Credit Agreement and (B) all fees, payments, costs and expenses (including all
costs, fees and expenses of counsel, accountants, investment bankers, financial advisors and
lenders) incurred by the Company, its Subsidiaries, CTH LLC or Shareholder, or on their behalf, in
connection with, or related to (i) the solicitation and receipt of consents or waivers from the
Lenders under the Credit Agreement in connection with the entry into or consummation of the
transactions contemplated by this Agreement, (ii) the preparation, negotiation, execution or
performance of the Company Debt Financing Commitment Letter and the receipt of the financing
thereunder and (iii) the refinancing of the Credit Agreement (whether paid or unpaid prior to the
Closing), including in each case all prepayment penalties, breakage costs and premiums on any of
the foregoing, as well as any additional interest costs or other fees incurred in connection with
the syndication of the Backstop Senior Credit Facilities, as applicable.



     “Severance Escrow Expiration Date” shall mean the fifty-fifth (55th)
calendar day following the six (6) month anniversary of the Closing Date.



     “Severance Plan” shall mean any Contract, plan, understanding or arrangement pursuant
to which employees of the Company or its Subsidiaries become entitled to payments or benefits upon
the termination of their employment with the Company or its Subsidiaries.



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     “Shareholder Disclosure Schedule” shall mean the Shareholder Disclosure Schedule
attached hereto as Schedule B.



     “Southcoast Lease” shall mean the Lease Agreement, dated as of January 25, 2005,
between Coast Hotels and Casinos, Inc. and Century Theatres, Inc., as amended.



     “Special Dividend” means that certain dividend paid by the Company to Shareholder in
conjunction with the consummation of the transactions contemplated by the Credit Agreement.



     “Subsidiary” shall mean, with respect to any Person, any Person of which securities or
other ownership interests having ordinary voting power to elect at least 50% of the board of
directors or other persons performing similar functions are at the time directly or indirectly
owned or controlled by such Person.



     “Syufy Lease” shall mean a real property lease under which Shareholder or any of its
Affiliates, or any Affiliate of the Company, is a landlord.



     “Syufy Lease Amendments” shall mean those certain amendments, attached hereto as
Exhibit J, to the Syufy Leases.



     “Tax” or “Taxes” shall mean all federal, state, local, foreign and other net
income, gross income, estimated, gross receipts, value-added, sales, use, ad valorem, transfer,
franchise, profits, license, lease, service, service use, withholding, payroll, employment, excise,
severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes,
fees, assessments or charges of any kind whatsoever, together with any interest, penalties or
additions to tax with respect thereto.



     “Tax Returns” shall mean all returns and reports (including elections, declarations,
disclosures, schedules, estimates and information returns) relating to Taxes, including any
schedule or attachment thereto and any amendment thereof, required to be filed or actually filed
with a Governmental Authority.



     “Terminating Syufy Lease Amendments” shall mean those certain amendments to the Syufy
Leases entered into by and between Shareholder and the Company, dated as of April 15, 2005 and
September 29, 2005.



     “Transaction Documents” shall mean this Agreement, the schedules and exhibits hereto,
the Contribution and Exchange Agreement and the other agreements, certificates, and items required
to be delivered pursuant to this Agreement.



     “Transition Services Agreement” shall mean the transition services agreement in the
form attached as Exhibit F hereto regarding the provision of certain services by the
Company to Shareholder after the Closing.



     “Unrelated Third Party” shall mean any Person other than Shareholder, CTH LLC, the
Company and its Subsidiaries.



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     “2006 Restructuring” means the redemption of Common Stock on January 3, 2006 described
in Section 3.11(b)(i) of the Company Disclosure Schedule.



     Section 1.2 Other Defined Terms. The following terms shall have the meanings defined for
such terms in the Sections set forth below:



	 	 	 
	Term	 	Section
	280G Waiver
	 	Section 6.15(b)
	2007 AIP
	 	Section 6.17(d)
	Agreement
	 	Preamble
	Aurora Property
	 	Section 6.22
	Benefit Plans
	 	Section 3.17(a)
	Closing
	 	Section 2.2
	Company
	 	Preamble
	Company Benefit Plans
	 	Section 6.11(b)
	Company Employees
	 	Section 3.17(a)
	Company Intellectual Property
	 	Section 3.16(b)
	Company Policies
	 	Section 3.20
	Continuing Employees
	 	Section 6.11(a)
	Debt Financing
	 	Section 5.11
	Debt Financing Commitment Letter
	 	Section 5.11
	Disability Law
	 	Section 5.10
	Employment Agreements
	 	Section 3.18(b)
	ERISA Affiliate
	 	Section 3.17(a)
	Financial Statements
	 	Section 3.9
	Flex Accruals
	 	Section 6.11(f)
	Foreign Benefit Plan
	 	Section 3.17(e)
	Government Antitrust Authority
	 	Section 6.3(b)
	Intellectual Property Agreements
	 	Section 3.12(a)
	Indemnified Party
	 	Section 9.2(c)
	Indemnifying Party
	 	Section 9.2(c)
	Interim Balance Sheet
	 	Section 3.9
	Interim Balance Sheet Date
	 	Section 3.9
	Interim Financial Statement
	 	Section 3.9
	JAMS
	 	Section 6.19
	Latest Audited Balance Sheet
	 	Section 3.9
	Latest Audited Balance Sheet Date
	 	Section 3.9
	Loss
	 	Section 9.2(a)
	Listed Agreements
	 	Section 3.12(a)
	Nasdaq
	 	Section 6.18(b)
	Purchase Price
	 	Section 2.5
	Purchaser
	 	Preamble
	Purchaser Cafeteria Plan
	 	Section 6.11(f)
	Purchaser Refund
	 	Section 6.9
	Real Property
	 	Section 3.13(a)
	Rollover
	 	Preamble






12









 






	 	 	 
	Term	 	Section
	Seller Refunds
	 	Section 6.9
	Severance Escrow Fund
	 	Section 6.17(c)
	Shareholder
	 	Preamble
	Shareholder Cafeteria Plan
	 	Section 6.11(f)
	Share Purchase
	 	Recitals
	Shares
	 	Recitals
	Straddle Period
	 	Section 6.8(a)
	Straddle Period Statement
	 	Section 6.8(c)
	Tax Claims
	 	Section 9.3(b)
	Third Party Claims
	 	Section 9.2(d)
	Update Period
	 	Section 6.4
	U.S. Benefit Plan
	 	Section 3.17(a)






ARTICLE II

PURCHASE AND SALE OF THE SHARES




     Section 2.1 Purchase and Sale; Purchase Price.



          (a) Subject to the terms and conditions of this Agreement, Purchaser agrees to purchase at the
Closing from Shareholder, and Shareholder agrees to sell to Purchaser at the Closing, the Shares
(other than the Rollover Shares) for an amount equal to (i) the number of Shares (other than the
Rollover Shares) multiplied by (ii) the Per Share Purchase Price. At the Closing, Purchaser shall
pay to Shareholder, by wire transfer of immediately available funds to an account designated in
writing by Shareholder to Purchaser at least two (2) Business Days prior to the Closing Date, an
amount equal to (i) the Per Share Purchase Price multiplied by (ii) the number of Shares (other
than the Rollover Shares). All amounts are payable in U.S. dollars.




          (b) At the Closing, Shareholder shall contribute the Rollover Shares to Holdings in exchange
for stock certificates representing 3,388,466 shares of Holdings Stock.




     Section 2.2 Closing. The purchase and sale of the Shares (other than the Rollover
Shares), and the contribution and exchange of the Rollover Shares for Holdings Stock, shall take
place at the offices of Morrison & Foerster LLP, 425 Market Street, San Francisco, California, at
10:00 a.m., on the date that is three (3) Business Days following the satisfaction or waiver in
writing of each of the conditions set forth in Article VII (other than those conditions
required to be satisfied at the Closing), unless the Shareholder and Purchaser mutually agree
otherwise (which time and place are designated as the “Closing”).



     Section 2.3 Closing Deliveries by Shareholder. At the Closing, Shareholder shall
deliver or cause to be delivered to Purchaser:



          (a) a certificate or certificates representing the Shares (other than the Rollover Shares)
duly endorsed in blank for transfer to Purchaser or accompanied by stock powers duly executed in
blank;




13









 








          (b) a certificate or certificates representing the Rollover Shares, duly endorsed in blank for
transfer to Holdings or accompanied by stock powers duly executed in blank;




          (c) the Transition Services Agreement, duly executed by Shareholder;




          (d) the License Agreement, duly executed by Shareholder;




          (e) the certificates and other items required to be delivered pursuant to Section 7.2;




          (f) the resignations of Raymond W. Syufy and Joseph Syufy and members of the Company’s, and
each of its Subsidiaries’, Board of Directors (unless otherwise directed in writing by Purchaser);




          (g) the assignment of ACTS copyright (Reg No. TXu-464-018) from Shareholder to the Company, in
a form reasonably satisfactory to Purchaser; and




          (h) such other certificates, instruments and documents as Purchaser and Holdings may
reasonably request to effectuate the Share Purchase and the Rollover.




     Section 2.4
Closing Deliveries by Purchaser and Holdings. (a) At the Closing,
Purchaser shall deliver to Shareholder:




          (i) in consideration of the Shares (other than the Rollover Shares), by check or by
wire transfer of immediately available funds to an account designated by Shareholder, an
amount equal to the Per Share Purchase Price, multiplied by the number of Shares (other than
the Rollover Shares);




          (ii) in consideration of the Rollover Shares, stock certificates representing 3,388,466
shares of Holdings Stock;




          (iii) the Transition Services Agreement, duly executed by Purchaser and the Company;




          (iv) the License Agreement, duly executed by Purchaser and the Company; and




          (v) the certificates and other items required to be delivered pursuant to Section
7.3; and




          (vi) such other certificates, instruments and documents as Shareholder may reasonably
request to effectuate the Share Purchase and the Rollover.



          (b) At the Closing, Purchaser shall cause the Company to deliver to each LTIP Employee, by
check or by wire transfer of immediately available funds to an account designated by such LTIP
Employee at least two (2) Business Days prior to the Closing, an amount equal to the LTIP Payment
(less applicable withholding) for such LTIP Employee as set forth on Section 3.17(f)(ii) of
the Company Disclosure Schedule.




14









 








     Section 2.5 Purchase Price. The purchase price (the “Purchase Price”) for the
Shares (including the Rollover Shares) shall be an amount equal to $681,225,930, as may be adjusted
in accordance with Section 6.22.



ARTICLE III

REPRESENTATIONS AND WARRANTIES

OF THE COMPANY




     The Company hereby represents and warrants that:



     Section 3.1 Organization, Good Standing and Qualification of the Company and its
Subsidiaries. Each of the Company and the Subsidiaries is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation and has all requisite
legal capacity, power and authority, including all corporate power and authority, to own, operate
and lease its properties and assets, to carry on its business as now conducted and to enter into
and perform its obligations under this Agreement and to consummate the Contemplated Transactions.
Each of the Company and its Subsidiaries is duly qualified to transact business and is in good
standing in each jurisdiction in which the ownership or use of the properties owned by it, or the
nature of the activities conducted by it, requires such qualification, except where the failure to
so qualify has not had and would not reasonably be expected to have a Company Material Adverse
Effect or to prevent or materially delay the consummation of the Contemplated Transactions. The
Company has made available to Purchaser complete and correct copies of the Governing Documents of
the Company and each of its Subsidiaries (as amended to date). The minute books (containing the
records of meetings of the shareholders, the board of directors, any committees of the board of
directors, the stock certificates, books, and the stock record books (or, in each case, the
equivalent for any entity that is not a corporation)) for the Company and each of its Subsidiaries
have been made available to the Purchaser and are correct and complete in all material respects.
Neither the Company nor any of its Subsidiaries is in default under or in violation of its
Governing Documents.



     Section 3.2 Authorization; Enforceability. This Agreement and the consummation of the
Contemplated Transactions have been duly authorized by all requisite corporate action by the
Company and the Company has full corporate power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement has been duly executed and
delivered by the Company and, assuming due authorization, execution and delivery by each of
Purchaser and Holdings of
this Agreement, this Agreement constitutes the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms, except (a) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally and (b) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable remedies.



     Section 3.3 Non-Contravention. The execution, delivery and performance by the
Company, CTH LLC or Shareholder of this Agreement and the consummation of the Contemplated
Transactions will not: (a) violate, conflict with or result in the breach of any provision of the
Governing Documents of the Company or any Subsidiary; (b) assuming all Governmental Authorizations
required under the HSR Act have been obtained or made, conflict



15









 







with or violate any Law,
Governmental Order or Governmental Authorization applicable to the Company or any Subsidiary or any
of their assets or properties; or (c) violate, conflict with, result in a material breach of any
provision of, constitute an event of default, if such term is applicable, or a default, if event of
default is not an applicable term, under, result in the termination, or in a right of termination
or cancellation, of, accelerate the performance required by, result in the triggering of any
payment or other material obligations pursuant to, result in the creation of any Lien on any of the
properties of the Company or its Subsidiaries under, or result in being declared void, voidable, or
without further binding effect, any of the terms, conditions or provisions of, any Listed Agreement
to which the Company or its Subsidiaries is a party, or by which the Company or its Subsidiaries or
any of their respective properties is bound or affected.



     Section 3.4 Governmental Authorizations. No Governmental Order, Governmental
Authorization or filing with, or provision of notice to, any Governmental Authority on the part of
the Company or its Subsidiaries is required in connection with the consummation of the Contemplated
Transactions, except (a) those required under the HSR Act, (b) those that may be required solely as
a result of the nature of the business or ownership of Purchaser, and (c) those the failure of
which to obtain or make would not reasonably be expected to be material to the Company and its
Subsidiaries taken as a whole or materially affect the ability of the Company or any Subsidiary to
consummate the Contemplated Transactions.



     Section 3.5 Capitalization and Voting Rights.



          (a) The entire authorized capital of the Company consists of (i) 50,000,000 shares of Common
Stock, of which 7,829,063 shares are issued and outstanding and (ii) 50,000,000 shares of preferred
stock, of which no shares are outstanding. Except as set forth on Section 3.5 of the
Company Disclosure Schedule, all of the issued and outstanding Shares are beneficially owned and
held of record by CTH LLC and, as of the Closing Date, will be beneficially owned and held of
record by Shareholder, in each case free and clear of all Liens, restrictions on voting rights,
purchase options, calls, preemptive rights or similar third party
rights on sale or restrictions on transfer (other than restrictions imposed by applicable
securities Laws).




          (b) The issued and outstanding Shares are all duly authorized and validly issued, fully paid
and nonassessable, were issued in accordance with the registration or qualification provisions of
the Securities Act and any relevant Laws, or pursuant to valid exemptions therefrom, and are not,
and were not at the date of issuance, subject to preemptive rights created by Law, Governing
Documents or any Contract.




          (c) There are not outstanding any options, warrants, rights (including conversion,
subscription, purchase, exchange or preemptive rights) or agreements or commitments for the
purchase or acquisition from or issuance by the Company of any shares of its capital stock or any
securities or obligations convertible or exchangeable into or exercisable for any securities of the
Company (now, in the future or upon the occurrence of any contingency), and no securities,
Contracts or instruments evidencing such rights are authorized, issued or outstanding. The Company
is not a party or subject to any Contract, proxy or understanding, and there is no Contract, proxy
or understanding which affects or relates to the voting or giving of written consents with respect
to any security of the Company. The Company

16









 








is not under any contractual or other obligation to
register any of its presently outstanding securities. There are no rights of first refusal,
co-sale rights or registration rights (including with respect to sales and resales thereof) granted
by the Company, CTH LLC or Shareholder with respect to the Company’s capital stock. There are no
outstanding or authorized stock appreciation, phantom stock, profit participation or similar rights
with respect to the Company’s capital stock.




     Section 3.6 Subsidiaries. The Company does not presently own or control, directly or
indirectly, any interest in any other corporation, joint venture, limited liability company,
partnership, association, or other business entity except for the Subsidiaries set forth on
Section 3.6 of the Company Disclosure Schedule, which sets forth each such Subsidiary,
together with its respective jurisdiction of organization, the authorized, issued and outstanding
stock or equity interests of each Subsidiary, the name of, and amounts held by, each holder
thereof. All of the issued and outstanding shares of stock or equity interests of each Subsidiary
are duly authorized and validly issued, fully paid and nonassessable and are owned by the Company
or a Subsidiary, as applicable, free and clear of all Liens, warrants, purchase options, calls,
preemptive rights, rights of first refusal, registration rights, restrictions on transfer,
Contracts, commitments, equities, claims, demands or other similar third party rights. Neither the
Company nor any of its Subsidiaries owns or holds the right to acquire any shares of stock or any
other interest in any other Person or has any agreement or commitment to purchase such shares or
interest. There are no outstanding options, warrants, rights (including conversion, subscription,
purchase, exchange or preemptive rights) or agreements or commitments for the purchase or
acquisition from any Subsidiary of any shares of its capital stock or equity interests or any
securities or obligations convertible or exchangeable into or exercisable for any securities of any
Subsidiary (now, in the future or upon the occurrence of any contingency), and no securities,
Contracts or instruments evidencing such rights are authorized, issued or outstanding. No
Subsidiary is a party or subject to any Contract, proxy or understanding which affects or relates
to the voting or giving of written consents with respect to
any security of such Subsidiary. There are no rights of first refusal, co-sale rights or
registration rights (including with respect to sales and resales thereof) granted by any of the
Company’s Subsidiaries with respect to such Subsidiaries’ capital stock or equity interests. There
are no outstanding or authorized stock appreciation, phantom stock, profit participation or similar
rights with respect to any of the Company’s Subsidiaries’ capital stock or equity interests.



     Section 3.7 Litigation. Except as set forth on Section 3.7 of the Company
Disclosure Schedule, there are no Actions pending or, to the Knowledge of the Company, threatened,
against or by the Company or any of its Subsidiaries or any of their respective assets that (i) has
as its principal remedy injunctive or equitable relief or (ii) could reasonably be expected to
involve payments or result in damages to the Company or such Subsidiary in excess of $100,000. The
Company is not subject to any outstanding Governmental Order. There are no Actions pending, or to
the Knowledge of the Company, threatened against the Company, its Subsidiaries, CTH LLC or
Shareholder (a) challenging or seeking to restrain, delay or prohibit any of the Contemplated
Transactions or (b) preventing the Company from performing, in all material respects, its
obligations under the Transaction Documents.



     Section 3.8 Compliance with Laws; Governmental Authorizations. (a) The Company and
its Subsidiaries have all material Governmental Authorizations necessary for the Company



17









 







and its Subsidiaries to own their assets and for the operation of the Company’s Business; (b) all such
Governmental Authorizations are in full force and effect and no Action is pending, or to the
Company’s Knowledge, threatened to suspend, revoke, or terminate any such Governmental
Authorization; and (c), except as set forth on Section 3.8 of the Company Disclosure
Schedule, the Company and its Subsidiaries are in compliance, and have complied, in all material
respects, with all applicable Laws and Governmental Authorizations and Governmental Orders which
affect the operation of the Company’s Business. None of the Company, CTH LLC or Shareholder is
making any representation or warranty in this Section 3.8 with respect to real estate
matters, environmental matters, employee benefit matters or Taxes, it being agreed that such
matters as they relate to compliance with Laws are exclusively addressed in Section 3.13,
Section 3.14, Section 3.16, and Section 3.19, respectively. Except as
disclosed on Section 3.8 of the Company Disclosure Schedule or with respect to the matters
that are the subject of Section 5.10, during the last 3 years, the Company and each of its
Subsidiaries has conducted its business in material compliance with all applicable Laws, and
neither the Company nor any of its Subsidiaries has been subject during the last 3 years to any
Governmental Order or any material inspection, material investigation, material penalty, material
assessment or material audit by any Governmental Authority alleging that the Company or any of its
Subsidiaries violated any Laws. The Company has no Knowledge of any written notice of any
violation or alleged violation of any Disability Law that is or would reasonably be expected to be
material to the Company.



     Section 3.9 Financial Statements. The Company has made available to Purchaser true
and complete copies of (a) its consolidated audited balance sheets, statements of income,
statements of shareholders’ equity
and statements of cash flows (the “Audited Financial Statements”) at and for the
fiscal years ended September 30, 2004 (restated) and September 29, 2005 (the “Latest Audited
Balance Sheet Date”) (the audited balance sheet dated September 29, 2005 being the “Latest
Audited Balance Sheet”); and (b) an unaudited consolidated balance sheet (the “Interim
Balance Sheet”) of the Company and its Subsidiaries at May 25, 2006 (the “Interim Balance
Sheet Date”) and the related statement of income for the eight month period then ended
(collectively, the “Interim Financial Statements” and, together with the Audited Financial
Statements, the “Financial Statements”). Except as set forth on Section 3.9 of the
Company Disclosure Schedule, the Financial Statements fairly present, in all material respects, as
applicable, the financial condition and results of operations of the Company and its Subsidiaries
on a consolidated basis as of the dates, and for the periods, indicated therein in conformity with
GAAP, applied on a consistent basis throughout the periods covered thereby, except that (i) the
Interim Financial Statements do not contain all footnotes required by GAAP and (ii) the Interim
Financial Statements are subject to normal year-end adjustments, none of which individually, or in
the aggregate, is or will be material.



     Section 3.10 No Undisclosed Liabilities. Except as set forth on Section 3.10
of the Company Disclosure Schedule, the Company and its Subsidiaries have no material liabilities
or obligations, whether known or unknown, accrued, absolute, unmatured, contingent or otherwise,
other than (a) as disclosed, reflected or reserved against on the face of the Interim Balance
Sheet, (b) liabilities incurred in the ordinary course of business subsequent to the Interim
Balance Sheet Date, none of which relates to a breach of Contract, tort, infringement, or violation
of Law, or (c) obligations under Listed Agreements (but not liabilities for breaches thereof) or
obligations under Contracts which are not required to be disclosed as Listed Agreements due to
specified dollar thresholds or other disclosure limitations (but not liabilities for breaches
thereof).



18









 





     Section 3.11 Absence of Changes.



          (a) Since the date of the Latest Audited Balance Sheet Date (i) except as contemplated by this
Agreement or as set forth on Section 3.11(a) of the Company Disclosure Schedule, the
Company’s Business has been conducted in all material respects in the ordinary course consistent
with past practice, and (ii) there has been no Company Material Adverse Effect.




          (b) Except as set forth on Section 3.11(b) of the Company Disclosure Schedule, since the
Latest Audited Balance Sheet Date, the Company and its Subsidiaries have not (i) declared or paid
any dividends, issued, purchased or redeemed any shares of their respective capital stock or any
securities convertible into or exchangeable for any of their respective capital stock, or made any
other distributions to their respective shareholders; (ii) granted any options or other rights to
purchase or obtain (including upon conversion, exchange or exercise) any of their respective
capital stock or equity interests; (iii) incurred, assumed, or guaranteed any liabilities or
Indebtedness of any kind other than liabilities (but not Indebtedness) incurred in the ordinary
course of business; (iv) amended or authorized any amendment to the
Governing Documents of the Company or any of its Subsidiaries; (v) made any acquisitions of
real property; (vi) made any capital investment in, any loan to, or any acquisition of the
securities or assets of any other Person involving more than $100,000 or outside the ordinary
course of business; (vii) cancelled, waived, compromised or released any right or claim (or series
of rights or claims) either involving more than $100,000 or outside the ordinary course of
business; (viii) granted or received any material license or sublicense under, or with respect to,
any Intellectual Property; (ix) made any change in or entered into any employment agreement that is
required to be disclosed pursuant to Section 3.18; (x) entered into any collective
bargaining agreement, written or oral, or, except as expressly provided for in this Agreement,
modified the terms of any existing such contract or agreement; (xi) managed the Company’s or its
Subsidiaries’ working capital outside the ordinary course of business; (xii) made any capital
expenditures (or series of related capital expenditures) in excess of $250,000 or outside the
ordinary course of business, other than any expenditures related to the design, construction or
equipping of any new theater (including such expenditures incurred after the theater opening which
are part of the original project budget); (xiii) disposed of any of their material assets; (xiv)
made any loan to, or entered into any other transaction with any of their employees, officers or
directors; (xv) made or pledged to make any charitable or other capital contribution outside the
ordinary course of business; (xvi) sold, assigned, leased, licensed or otherwise transferred any of
their material assets or properties other than in the ordinary course of business; (xvii) subjected
any of their assets to any Liens, except for Permitted Liens; (xviii) changed their accounting
methods, principles or practices; (xix) suffered any material damage, destruction or loss (whether
or not covered by insurance) affecting their assets; (xx) experienced a material adverse change in
relations with their customers, landlords, creditors, employees, suppliers, movie studios or
communities with which they conduct business; or (xxi) committed to do any of the foregoing.




     Section 3.12 Listed Agreements.




          (a) Section 3.12 of the Company Disclosure Schedule sets forth a list of all the
following Contracts to which the Company or any Subsidiary is a party or by which any of them are
bound (other than (x) Real Property Leases, Pipeline Construction Agreements,



19









 







Pipeline
Architectural Agreements and Construction Purchase Orders, (y) Employment Agreements (which are
addressed in Sections 3.13 and 3.16 and 3.18, respectively) and (z) Film
Master License Agreements) (collectively, the “Listed Agreements”):





          (i) Contracts involving obligations or commitments by the Company or any Subsidiary
that involve payments in excess of $100,000 due or payable after the date of this Agreement,
that have a remaining term of at least 12 months and are not terminable by the Company or
its Subsidiaries, without penalty, upon sixty (60) days’ notice or less;




          (ii) Contracts involving the purchase or sale of any business, corporation,
partnership, joint venture or other business organization;




          (iii) Contracts involving the creation, incurrence, assumption or guaranty of
Indebtedness or the granting of a Lien on the Company’s or its Subsidiaries’ assets to
secure such Indebtedness;




          (iv) Contracts involving advertising, commercials, promotions or displays on or about
the theatre premises, or that prohibit or restrict any of the foregoing;




          (v) Consulting Contracts involving payments by the Company or any of its Subsidiaries
in excess of $100,000;




          (vi) Contracts (or group of related Contracts) or options to sell, license (as
licensor) or lease (as lessor) any property or asset of the Company or any of its
Subsidiaries with a value in excess of $100,000;




          (vii) Contracts (or group of related Contracts) pursuant to which the Company or any of
its Subsidiaries (i) possesses or uses, or has agreed to acquire, license (as licensee) or
lease (as lessee), any property or asset and (ii) is required to make payments, accrue
expenses or incur charges in excess of $100,000 per year;




          (viii) Contracts (or group of related Contracts), plans or programs pursuant to which
payments, or an acceleration of or increase in benefits, may be required in connection with
a change of control of the Company or any of its Subsidiaries or which would require any
Change of Control Payment;




          (ix) Contracts (or group of related Contracts) requiring capital expenditures by the
Company or any of its Subsidiaries in excess of $100,000;




          (x) Contracts which create a partnership or joint venture to which the Company or any
of its Subsidiaries is a party or by which any of them is bound;




          (xi) (A) Contracts outside the ordinary course of business that have as their principal
purpose the indemnification of an Unrelated Third Party and (B) Contracts relating to the
purchase or sale of any business, corporation, partnership, joint venture or other business
organization, or all or substantially all of the assets of any of the



20









 







foregoing, that
contain a provision which could be expected to give rise to an indemnification obligation of
the Company or any of its Subsidiaries;




          (xii) Contracts that prohibit or restrict the Company or any of its Subsidiaries from
freely engaging in business anywhere in the world;




          (xiii) Contracts pursuant to which the Company or any of its Subsidiaries provides
management services or consulting services with respect to theatres or other real property
projects;




          (xiv) Contracts to which the Company or any of its Subsidiaries is a party under which
the consequences of a default or termination could reasonably be expected to have a Company
Material Adverse Effect;




          (xv) Any Contracts pertaining to the use by the Company or its Subsidiaries of any
material Intellectual Property used in the conduct of the Company’s Business as it is
currently conducted, excluding any “shrink-wrap,” “click-wrap” and off-the-shelf computer
software licenses purchased or licensed for less than $50,000 over the term of such Contract
(excluding renewals) (“Intellectual Property Agreements”);




          (xvi) Contracts with any party relating to the acquisition, license or use of digital
projection systems to exhibit feature films in the 3D format;




          (xvii) Contracts with any party relating to the acquisition, license or use of digital
projection systems to exhibit feature films in the 2D format; and




          (xviii) Contracts with any Real Estate Broker currently in effect or under which the
Company has any continuing obligations as of the date hereof.



          (b) The Company has made available to Purchaser a true, complete and correct copy of each of
the Listed Agreements, and all amendments thereto, and all material notices and waivers thereunder
and a written summary of all oral Listed Agreements. Except for any Listed Agreement which expires
by its terms prior to Closing or is terminated consistent with the terms of this Agreement, and,
except as set forth on Section 3.12(b) of the Company Disclosure Schedule, each Listed
Agreement is in full force and effect, and each Listed Agreement is valid and legally binding with
respect to the Company or the Subsidiary which is a party thereto, enforceable against each such
party in accordance with its terms and, to the Knowledge of the Company, is valid and legally
binding with respect to each other party thereto, enforceable against such party in accordance with
its terms. None of the Company or its Subsidiaries is and, to the Company’s Knowledge, no other
party is, in material breach of or material default under any Listed Agreement, and, to the
Company’s Knowledge, no event has occurred or condition exists that, with or without notice or
lapse of time or both, has resulted or would result, in a material breach or a material default
under the Listed Agreements.




21









 








     Section 3.13 Real Property; Pipeline Construction Agreements. (a) Section
3.13(a)(i) of the Company Disclosure Schedule contains a list of all real property owned,
leased or subleased by the Company or its Subsidiaries (the “Real Property”). The Company
or its Subsidiaries owns fee title to each of the Fee Properties free and clear of all Liens,
except for (i) Permitted Liens and (ii) Liens that will be released at the Closing which secure the
existing financing of the Company and its Subsidiaries. The Company or its Subsidiaries own the
entire interest of the lessee or sublessee with respect to each of the Leased Properties. Except
for the disclosure with respect to that certain Contingent Payment Agreement, dated as of November
8, 2001, between Cinerama Theatres Inc. of California and Corte Madera Theatres, LLC set forth on
Section 3.13(a)(ii) of the Company Disclosure Schedule, there are no outstanding options or
rights of refusal or offer to purchase any of the Fee Properties, and neither the Company nor any
of its Subsidiaries is a party to any agreement or option to purchase any real property.



          (b) The Company has made available to Purchaser a true, complete and correct copy of each Real
Property Lease, and all amendments thereto, and the interest of the
Company and its Subsidiaries in each of the Fee Properties and the Leased Properties is not
subject to any Lien or other adverse claim in favor of the Shareholder, its Affiliates or any
Unrelated Third Party, other than (x) Permitted Liens and (y) Liens that will be released at the
Closing which secure the existing financing of the Company and its Subsidiaries. Except as set
forth on Section 3.13(b)(iii) of the Company Disclosure Schedule, the Company and its
Subsidiaries have not conveyed or granted to Shareholder, its Affiliates (including CTH LLC) or any
Unrelated Third Party any interest in or option to acquire any interest in the Fee Properties or
the Leased Properties. The Company and its Subsidiaries have not assigned or transferred to
Shareholder, its Affiliates (including CTH LLC) or any Unrelated Third Party any interest in or
option to acquire any interest in the Real Property Leases and have not sublet any portion of the
Leased Properties or granted any possessory rights (or option to acquire any possessory rights) to
the Leased Properties to Shareholder, its Affiliates (including CTH LLC) or any Unrelated Third
Party, other than customary license and concession agreements entered into in the ordinary course
of the Company’s Business and temporary uses such as “four wall” deals. Except as set forth on
Section 3.13(b)(iv) of the Company Disclosure Schedule, with respect to each of the Real
Property Leases (i) each lease is in full force and effect, and is a legal, valid, binding and
enforceable leasehold interest in favor of the Company or its applicable Subsidiary subject to the
terms of the applicable Real Property Lease; (ii) the consummation of this transaction does not
require the consent of Shareholder or CTH LLC or any other party to such Real Property Lease and
will not result in a breach of or default under such Real Property Lease; (iii) none of the
Company, any Subsidiary or, to the Company’s Knowledge, any other party to any Real Property Lease
is in material breach, or has taken any action or failed to take any action which has resulted in
an event of default, if such term is applicable, or a default, if “event of default” is not an
applicable term, under such Real Property Lease; (iv) to the Company’s Knowledge, there are no
material disputes with landlords under any Real Property Lease; (v) the Company has no Knowledge
that any other party to any Real Property Lease is in material breach, or has taken any action or
failed to take any action which has resulted in an event of default, if such term is applicable, or
a default, if “event of default” is not an applicable term, under such Real Property Lease; (vi) no
security deposit or portion thereof deposited with respect to such Real Property Lease has been
applied in respect of a material breach or material default under such Real Property Lease which
has not been redeposited in full; (vii) none of the Company, any of its Subsidiaries, Shareholder
or CTH LLC has sublicensed, licensed or otherwise granted any


22









 







Person the right to use or occupy any
Fee Property or any portion thereof other than temporary uses such as “four wall” deals and
customary license and concession agreements entered into in the ordinary course of the Company’s
Business, (viii) there are no Liens on the estate or interest created by such Real Property Lease,
except for (x) Permitted Liens and (y) Liens that will be released at the Closing securing the
existing financing of the Company and its Subsidiaries.




          (c) Except with respect to the Real Property listed in Section 3.13(c)(i) of the
Company Disclosure Schedule, neither the Company nor any of its Subsidiaries is bound by any
Contract with respect to the ownership, development, construction, financing, lease or operation of
any new movie theater other than a Pipeline Theater. The Company has made available to Purchaser a
true and correct copy of each Pipeline Construction Agreement and Pipeline Architectural Agreement.
Neither the Company nor any Subsidiary is in material breach or default under any Pipeline
Construction Agreement or Pipeline Architectural Agreement. The total expenditures on Pipeline
Theaters, as of July 21, 2006, is set forth in Section 3.13(c)(ii) of
the Company Disclosure Schedule. The aggregate amount due and payable to Real Estate Brokers
does not exceed $100,000 in the aggregate.




          (d) To the Company’s Knowledge, Section 3.13(d) of the Company Disclosure Schedule
sets forth each Real Estate Lease which contains an obligation of the Company or any Subsidiary
with respect to screen advertising.




     Section 3.14 Environmental Law. Except as set forth in Section 3.14 of the Company
Disclosure Schedule, (i) neither the Company nor any Subsidiary has received any notice from any
Governmental Authority claiming any material violation by the Company or any Subsidiary of, or
material liability under, any Environmental Law, or requiring any investigation or remediation of
Hazardous Materials under any Environmental Law at any Real Property owned, leased, subleased or
operated by the Company or its Subsidiaries; (ii) the Company and its Subsidiaries are, and have
been at all times, in material compliance with all Environmental Laws; (iii) the Company and its
Subsidiaries are not subject to any existing, pending or, to the Company’s Knowledge, threatened
material Actions under any Environmental Law; (iv) the Company and its Subsidiaries have obtained
all material permits required under Environmental Laws and such permits are currently in full force
and effect; (v) there have been no material unauthorized or other releases of any Hazardous
Materials at or from any property or facility owned or operated at any time by the Company, any of
its Subsidiaries or any of their respective predecessors that have or would give rise to a material
liability or material obligation of the Company or its Subsidiaries; (vi) none of the Company, any
of its Subsidiaries, or any of their predecessors has treated, stored, disposed, arranged for or
permitted the disposal of, exposed any person to, transported or released any Hazardous Materials
so as to give rise to a material liability or material obligation under Environmental Laws; (vii)
the Company has made available to Purchaser all environmental audits, assessments and reports and
all other documents materially bearing on liabilities arising under any Environmental Law, in each
case relating to its or its Subsidiaries’, Affiliates’ or predecessors’ past or current properties,
facilities or operations which are in its possession or under its reasonable control; and (viii)
neither the Company nor any of its Subsidiaries has any material liabilities with respect to or
arising from underground storage tanks, landfills, surface impediments or disposal areas at or
affecting any Real Property. This Section 3.14 contains the sole and exclusive
representations and warranties with respect to matters arising from Environmental Laws.



23









 





     Section 3.15 Personal Property. Except as set forth on Section 3.15 of the
Company Disclosure Schedule, the Company and its Subsidiaries have good and marketable title to
their respective material tangible personal property owned and used by them, and have a legal right
to use all other material tangible personal property used by them pursuant to the terms of the
respective agreements with third parties governing the possession or use of such material tangible
personal property, other than those disposed of in the ordinary course of business since the date
of the Latest Audited Balance Sheet, in each case free and clear of all Liens, except for (a)
Permitted Liens and (b) Liens that will be released at the Closing which secure the existing
financing of the Company and its Subsidiaries. Such properties of the Company and its Subsidiaries
have been maintained in accordance with normal industry practice, are in good operating condition
and repair (subject to normal wear and tear), and are suitable for the purposes for which they are
presently used. None
of the Company, CTH LLC or Shareholder is making any representation or warranty in this
Section 3.15 with respect to Real Property or Intellectual Property matters, it being
agreed that such matters are exclusively addressed in Section 3.13 and Section
3.16, respectively.



     Section 3.16 Intellectual Property.



          (a) Section 3.16(a) of the Company Disclosure Schedule sets forth a complete and
correct list of all of the following owned by the Company or one of its Subsidiaries: (i) patents,
pending patent applications and applications for copyrights, servicemarks and trademarks; (ii)
material unregistered trademarks; (iii) domain names; and (iv) Company Proprietary Software.




          (b) Except as set forth on Section 3.16(b) of the Company Disclosure Schedule, the
Company and its Subsidiaries own and possess all right, title and interest in and to all of the
Intellectual Property set forth on Section 3.16(a) of the Company Disclosure Schedule, free
and clear of all Liens. The Company and its Subsidiaries are in material compliance with their
license agreements for material Intellectual Property used in the operation of the Company’s
Business. None of Shareholder, CTH LLC or any director, officer or employee of the Company or its
Subsidiaries, has or will have immediately after the Closing Date, any right, title or interest in
or to any of the material Intellectual Property used in the operation of the Company’s Business
(“Company Intellectual Property”).




          (c) To the Company’s Knowledge, all of the Intellectual Property set forth on Section
3.16(a) of the Company Disclosure Schedule is valid and enforceable.




          (d) No claim by any third party contesting the validity, enforceability, use or ownership of
any of the Company Intellectual Property (excluding any Company Intellectual Property that is
licensed by the Company) has been made, is currently outstanding or, to the Company’s Knowledge, is
threatened.




          (e) Except with respect to patents, neither the Company nor its Subsidiaries have infringed or
misappropriated, and the operation of the Company’s Business does not infringe or misappropriate,
any Intellectual Property of any Person, and neither the Company nor any of its Subsidiaries has
received any notices regarding any of the foregoing. To the Knowledge of the Company, neither the
Company nor its Subsidiaries have infringed, and the operation of the Company’s Business does not
infringe, any patent rights of any Person, and neither the Company


24









 







nor any of its Subsidiaries has
received any written notices regarding any of the foregoing. To the Knowledge of the Company, no
Person has infringed or misappropriated any of the Company Intellectual Property.




          (f) Except as set forth on Section 3.16(f) of the Company Disclosure Schedule, the
Company or one of its Subsidiaries owns and possesses all right, title and interest in and to all
Company Proprietary Software created or developed by, for or under the direction or supervision of
the Company or one of its Subsidiaries.




          (g) Except with respect to Intellectual Property covered by a Listed Agreement set forth in
Section 3.12(a)(xv) of the Company Disclosure Schedule, immediately subsequent to
the Closing, the Company Intellectual Property will be owned by or available for use by the
Company and its Subsidiaries on terms and conditions identical to those under which the Company and
its Subsidiaries owned or used such Company Intellectual Property immediately prior to the Closing.




          (h) Shareholder is not a party to any Contract with any Unrelated Third Party relating to the
licensing of Company Intellectual Property for use in the Company’s Business.




     Section 3.17 Employee Benefit Plans.



          (a) Section 3.17(a) of the Company Disclosure Schedule sets forth a complete and
correct list of (i) each “employee benefit plan,” as defined in Section 3(3) of ERISA, (ii) each
severance pay, vacation pay, salary continuation, sick leave, bonus or other incentive
compensation, stock or other equity related award, restricted stock, stock option, stock purchase,
phantom stock or similar arrangement, deferred compensation plan or arrangement, and (iii) each
other employee fringe benefit plan or arrangement and each employment, consulting, retirement,
pension, profit sharing, termination, severance, redundancy pay or individual compensation
agreement or arrangement, that is currently maintained, sponsored or otherwise contributed to by
the Company or any of its Subsidiaries, or any other person or entity that, together with the
Company or any of its Subsidiaries is treated as a single employer under Section 414(b), (c), (m)
or (o) of the Code (each, an “ERISA Affiliate”) for the benefit of the current or former
employees (or the beneficiaries or dependents thereof) of the Company or any of its Subsidiaries,
including any such individuals who are located outside the United States (“Company
Employees”), or with respect to which the Company or any of its Subsidiaries has or could have
any obligation or liability (collectively, the “Benefit Plans”). Each Benefit Plan that is
maintained, sponsored or contributed to by the Company, any of its Subsidiaries or any ERISA
Affiliate primarily for the benefit of individuals located in the United States shall be referred
to herein as a “U.S. Benefit Plan.” With respect to each U.S. Benefit Plan, true, correct
and complete copies of the following have been made available to Purchaser: (1) the most recent
document constituting the U.S. Benefit Plan and all amendments thereto, (2) the most recent annual
report on Form 5500 filed with the Internal Revenue Service with respect to each U.S. Benefit Plan
(if any such report was required by applicable Law), (3) the most recent summary plan description
for each U.S. Benefit Plan for which such a summary plan description is required by applicable Law
and all related summaries of material modifications; (4) the most recent Internal Revenue Service
determination, notification, or opinion letter, if any, received with respect to each applicable
U.S. Benefit Plan, and (5) each trust agreement, insurance



25









 








contract, annuity contract, or other
funding arrangement in effect as of the date hereof and relating to any U.S. Benefit Plan.




          (b) None of the Company, any of its Subsidiaries or any ERISA Affiliate maintains, sponsors or
contributes to, and has not maintained or contributed to (or been obligated to contribute to)
within the six calendar years preceding the Closing date, or has any material liability with
respect to, any multiemployer plan as defined in Section 3(37) or Section 4001(a)(3) of ERISA or
Section 414(f) of the Code, any multiple employer plan within the meaning of Section 4063 or
Section 4064 of ERISA or Section 413(c) of the Code, any employee benefit plan, fund, program,
contract or arrangement that is subject to Section 412 of the Code, Section 302 of ERISA or Title
IV of ERISA, or any welfare benefit plan which
provides life or health benefits to an employee or former employee or other individual (or any
dependents or beneficiaries thereof) after termination of employment or other services or
retirement except as required under Section 4980B of the Code and Sections 601 through 608 of ERISA
(or comparable state Law) (“COBRA”). The Company, its Subsidiaries and each ERISA Affiliate have
complied in all material respects with the requirements of COBRA.




          (c) Except as set forth on Section 3.17(c) of the Company Disclosure Schedule, each
U.S. Benefit Plan (and each related trust, insurance contract or fund) has been maintained, funded
and administered in substantial compliance with its terms and applicable Law, including ERISA and
the Code. There are no ongoing or pending investigations, legal proceedings or other claims, suits
or, to the Company’s Knowledge, threatened suits or proceedings against or involving any U.S.
Benefit Plan or asserting any rights or claims to benefits under any U.S. Benefit Plan that would
reasonably be expected to give rise to any material liability (except claims for benefits payable
in the normal operation of the U.S. Benefit Plans). None of the U.S. Benefit Plans has any
material unfunded liabilities that are not reflected on the face of the Interim Balance Sheet.
There have been no material, non-exempt “prohibited transactions” (as defined in Section 406 of
ERISA and Section 4975 of the Code) with respect to any U.S. Benefit Plan or any U.S. Benefit Plan
maintained by an ERISA Affiliate. To the Company’s Knowledge, no fiduciary has any material
liability for breach of fiduciary duty or other material failure to act or comply with applicable
Law with respect to the administration or investment of the assets of any U.S. Benefit Plan.




          (d) Except as set forth on Section 3.17(d) of the Company Disclosure Schedule, all
contributions and premium payments to, and payments from, the U.S. Benefit Plans that may have been
required to be made in accordance with their terms have been timely made in all material respects,
and all contributions and premium payments to the U.S. Benefit Plans that are not yet due have been
made or accrued in accordance with past custom and practice of the Company and its Subsidiaries.
Except as set forth on Section 3.17(d) of the Company Disclosure Schedule, all required
reports and descriptions (including Form 5500 annual reports, summary annual reports, and summary
plan descriptions) have been timely filed and/or distributed in accordance with the applicable
requirements of ERISA and the Code with respect to each such U.S. Benefit Plan in all material
respects. Except as set forth on Section 3.17(d) of the Company Disclosure Schedule, each
U.S. Benefit Plan and its related trust intended to qualify under Section 401(a) and 501(a) of the
Code, respectively, so qualify and, to the Company’s Knowledge, nothing has occurred with respect
to the operation of any such plan that would cause

26









 








the loss of such qualification or exemption or
the imposition of any material liability, penalty or tax under ERISA or the Code.




          (e) Each Benefit Plan that is governed by Laws of any jurisdiction other than the United
States (each a “Foreign Benefit Plan”) has been in all material respects maintained, funded
and administered in accordance with applicable Laws and the requirements of such Foreign Benefit
Plan’s governing documents and any applicable collective bargaining agreements. Except as set
forth on Section 3.17(e) of the Company Disclosure Schedule, there are no unfunded
liabilities with respect to any Foreign Benefit Plan. Except as indicated otherwise on Section
3.17(e) of the Company Disclosure Schedule, no condition exists that would prevent the Company or
any of its Subsidiaries from terminating or amending any Foreign Benefit Plan.




          (f) Except as set forth on Section 3.17(f)(i) of the Company Disclosure Schedule,
there are no agreements or Contracts that will require a Change of Control Payment in connection
with the consummation of the Transactions contemplated by this Agreement. Section
3.17(f)(ii) of the Company Disclosure Schedule sets forth the total amounts payable to each
LTIP Participant under the LTIP in connection with the consummation of the Transactions
contemplated by this Agreement and the aggregate amount of all such payments for all LTIP
Participants. Except as set forth on Section 3.17(f)(iii) of the Company Disclosure
Schedule, there are no agreements or Contracts under which the Company or its Subsidiaries is
obligated to make any severance payments or other payments to any employee of the Company or its
Subsidiaries upon termination of such employee’s employment. Section 3.17(f)(iv) of the
Company Disclosure Schedule sets forth the total amount of severance or other payments that would
be due to each employee of the Company or its Subsidiaries upon such employee’s termination of
employment and the aggregate amount of all such severance or other payments for all employees of
the Company or its Subsidiaries.




     Section 3.18 Labor Agreements and Actions.



          (a) None of the employees of the Company or its Subsidiaries are represented by a labor
organization for the purposes of collective bargaining. Neither the Company nor any of its
Subsidiaries is party to any collective bargaining agreement. To the Company’s Knowledge, there is
no strike or other material labor dispute involving, pending, or threatened against the Company or
any Subsidiary. No labor organization or group of employees has filed any representation petition
or made any written or oral demand for recognition as the bargaining representative of the
employees of the Company or any Subsidiary.




          (b) Section 3.18(b) of the Company Disclosure Schedule sets forth a list of all
written employment agreements between the Company or any Subsidiary, on the one hand, and any
employee of the Company or any Subsidiary, on the other (the “Employment Agreements”).
None of the Company, any Subsidiary or, to the Company’s Knowledge, any employee of any of the
foregoing is in material breach of any Employment Agreement.




          (c) Except as set forth in Section 3.18(c) of the Company Disclosure Schedule, there
are no material employment or labor-related Actions, lawsuits, administrative charges, or written
complaints against the Company or any Subsidiary pending or, to the

27









 








Company’s Knowledge, threatened
before any court or administrative agency with jurisdiction over labor or employment matters.




          (d) To the Company’s Knowledge, no executive of the Company or its Subsidiaries having a title
of senior vice president or above has given notice of any present intention to terminate his or her
employment.




          (e) There is no material worker’s compensation claim or liability that is not fully insured.




          (f) Section 3.18(f) of the Company Disclosure Schedule sets forth a schedule of the
current annual base salary (exclusive of any bonus plan) payable to any employee of the Company or
any of its Subsidiaries at the corporate office.




     Section 3.19 Tax Returns, Payments and Elections.



          (a) The Company and its Subsidiaries have timely filed (i) all Income Tax Returns required to
have been filed with respect to periods through September 29, 2005, and (ii) all Non-Income Tax
Returns required to have been filed with respect to the assets and operations of the Company and
its Subsidiaries with respect to periods through May 25, 2006. All Tax Returns referred to in (i)
and (ii) of the preceding sentence are true and correct in all material respects. Except as set
forth on Section 3.19(a) of the Company Disclosure Schedule, all Income Taxes due and
payable by the Company and its Subsidiaries with respect to periods through September 29, 2005,
were paid on or before May 25, 2006. Except as set forth on Section 3.19(a) of the Company
Disclosure Schedule, all Non-Income Taxes due and payable by the Company and its Subsidiaries with
respect to their assets and/or operations as of May 25, 2006, were paid on or before May 25, 2006.
All deficiencies asserted or assessments with respect to all Taxes have been paid in full, and
there are no Liens with respect to Taxes upon any of the assets of the Company or its Subsidiaries
other than Permitted Liens.




          (b) Except as set forth on Section 3.19(b) of the Company Disclosure Schedule, there
is no material dispute or claim concerning any Tax liability or Tax Return of the Company or any of
its Subsidiaries (i) claimed or raised by any Governmental Authority or (ii) that is threatened in
writing, by any Governmental Authority. Neither the Company nor any of its Subsidiaries has waived
any statute of limitations in respect of Taxes or agreed to any extension of time with respect to a
Tax assessment or deficiency.




          (c) Neither the Company nor any of its Subsidiaries is a party to any Tax allocation, Tax
sharing or similar agreement or arrangement. Neither the Company nor any of its Subsidiaries (i)
has been a member of an Affiliated Group filing a consolidated federal income Tax Return, or
included or required to be included, in any other group of entities filing or required to file any
other Tax Return as a member of an Affiliated Group, other than a group of which the Company is the
common parent or (ii) is liable for Taxes of another Person under Treasury Regulation 1.1502-6 (or
any similar provision of state, local or foreign law), by contract, or by reason of being a
transferee or successor of such Person or otherwise.




          (d) Neither the Company nor any of its Subsidiaries has, in the two (2) years preceding the
date of this Agreement, been either a “distributing corporation” or a “controlled

28









 







corporation”
within the meaning of Section 355(a)(1)(A) of the Code or, within such two-year period, has been
included in a group of corporations filing a federal consolidated Tax Return with a corporation
which was, during such period, a “distributing corporation” or a “controlled corporation” within
the meaning of Section 355(a)(1)(A) of the Code.




          (e) No claim has been made in writing by any Governmental Authority in a jurisdiction where
the Company or any of its Subsidiaries does not file Tax Returns that the Company or its
Subsidiaries are, or may be, subject to Tax in that jurisdiction.




          (f) Except as set forth on Section 3.19(f) of the Company Disclosure Schedule, the
Company and each of its Subsidiaries has withheld and paid all Taxes required to have been withheld
and paid in connection with any amounts paid or owing to any employee, independent contractor,
creditor, shareholder or other third party, and all Forms W-2 and 1099 required with respect
thereto have been properly completed and timely filed.




          (g) Except as set forth on Section 3.19(g) of the Company Disclosure Schedule, neither
the Company nor any of its Subsidiaries is a party to any Contract, arrangement, or plan that has
resulted or could result, separately or in the aggregate, in the payment of any “excess parachute
payment” within the meaning of Code § 280G (or any corresponding provision of state, local, or
foreign Tax law), including with respect to the Contemplated Transactions.




          (h) The Company has made available to the Purchaser correct and complete copies of all federal
income Tax Returns, examination reports, and statements of deficiencies assessed against or agreed
to by the Company or any Subsidiary, filed or received since December 31, 2000.




          (i) Neither the Company nor any of its Subsidiaries will be required to include any material
item of income in, or exclude any material item of deduction from, taxable income for any taxable
period (or portion thereof ) ending after the Closing Date as a result of any: (i) change in method
of accounting for a taxable period ending on or prior to the Closing Date; (ii) “closing agreement”
as described in Code § 7121 (or any corresponding or similar provision of state, local, or foreign
income Tax law) executed on or prior to the Closing Date; (iii) intercompany transactions or any
excess loss account described in treasury regulations under Code Section 1502 (or any corresponding
or similar provisions of state, local or foreign income Tax law) (iv) installment sale or open
transaction disposition made on or prior to the Closing Date; or (v) prepaid amount received on or
prior to the Closing Date.




          (j) Neither the Company nor any of its Subsidiaries has engaged in a “listed transaction” as
defined in Treas. Reg. § 1.6011-4(b)(2).




          (k) The unpaid Non-Income Taxes of the Company and its Subsidiaries did not, as of the Interim
Balance Sheet Date, exceed the reserve for Tax liability (excluding any such reserves relating to
Income Taxes) set forth on the Interim Balance Sheet. Since the Interim Balance Sheet Date, the
Company and its Subsidiaries have not incurred any liability for Taxes outside the ordinary course
of business.




29









 








     Section 3.20 Insurance. Section 3.20 of the Company Disclosure Schedule sets
forth a list of all insurance policies maintained by or on behalf of the Company and its
Subsidiaries on the date of this Agreement (the “Company Policies”). The Company has made
available to Purchaser true and complete copies of all such policies, together with all written
riders and amendments thereto. With respect to the Company Policies: (a) all are in full force and
effect and no notice of cancellation or termination has been received with respect to any such
policy or binder; (b) all have been complied with in all material respects by the policyholder,
and, to the Company’s
Knowledge, no event has occurred that, with notice or lapse of time, would constitute a
material breach of or default under such policy or binder, or permit termination, modification, or
acceleration thereunder; and (c) to the Company’s Knowledge, there is no pending material claim
under any such policy as to which coverage has been denied or disputed by the underwriters or
issuers thereof or for which the Company or any of its Subsidiaries has received a reservation of
rights letter with respect to any insurance claim during the last three years. Section
3.20 of the Company Disclosure Schedule describes any self-insurance arrangements affecting the
Company and its Subsidiaries. All premiums with respect to such policies are currently paid. The
reserves set forth on the face of the Interim Balance Sheet are adequate to cover all anticipated
liabilities with respect to any self-insurance, deductible, retention or co-insurance programs.



     Section 3.21 Affiliate Transactions. Except as set forth on Section 3.21 of
the Company Disclosure Schedule, none of Shareholder, CTH LLC or any of their respective Affiliates
(other than the Company and its Subsidiaries), nor the Company’s and its Subsidiaries’ officers,
directors and employees, are a party to any Contract or understanding or arrangement with the
Company or its Subsidiaries, and none of the foregoing have been party to any such Contract,
understanding or arrangement within the last 12 months, and there are no guarantees, letters of
credit, reimbursement agreements, keep-well agreements, indemnity agreements, equity contribution
agreements or other credit support agreements under which the Company or its Subsidiaries have any
outstanding obligations that relate to obligations of, or to the business or assets of,
Shareholder, CTH LLC or any of their respective Affiliates (other than the Company and its
Subsidiaries) or the Company’s and its Subsidiaries’ officers, directors and employees. None of
Shareholder, CTH LLC, any of their respective Affiliates (other than the Company and its
Subsidiaries), or the Company’s or its Subsidiaries’ officers, directors or employees, owns or has
any right to use any material asset, tangible or intangible, that is used in the Company’s
Business.



     Section 3.22 Significant Suppliers. Except as set forth on Section 3.22 of
the Company Disclosure Schedule, neither the Company nor any of its Subsidiaries has received any
written notice from any material supplier (including Coca-Cola, Inc. or any of its Affiliates) to
the effect that, and the Company has no Knowledge that, such supplier will stop, materially
decrease the rate of, or materially change the terms of (whether related to payment, price or
otherwise), supplying materials, products or services to the Company or any of its Subsidiaries
(whether as a result of the consummation of the Contemplated Transactions or otherwise).



     Section 3.23 No Brokers. Except for the obligations under the engagement letter
between Shareholder and Morgan Stanley & Co. Incorporated dated July 10, 2006, neither the Company
nor its Subsidiaries is obligated under any Contract which would result in the obligation of the
Company or its Subsidiaries to pay any fees or incur any obligations to any



30









 







Broker in connection
with the negotiations leading to this Agreement or the consummation of the Contemplated
Transactions.



     Section 3.24 Indebtedness. Section 3.24 of the Company Disclosure Schedule
reflects all Indebtedness of the Company and its Subsidiaries.



     Section 3.25 Company Financing. The Company has received, accepted and agreed to a
commitment letter from Morgan Stanley Senior Funding, Inc. (the “Company Debt Financing
Commitment Letter”), committing such entity to provide debt financing for the refinancing of
the Credit Agreement. A true and complete copy of the executed Company Debt Financing Commitment
Letter is attached hereto as Exhibit P and the Company Debt Financing Commitment Letter is
in full force and effect and the Company is not in breach of any of the terms thereof.



     Section 3.26 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT AND THE
SCHEDULES AND EXHIBITS HERETO AND IN ANY CERTIFICATE REQUIRED TO BE DELIVERED HEREUNDER, NEITHER
THE COMPANY NOR THE SHAREHOLDER MAKES ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, RELATING
TO THE SHARES, THE COMPANY, THE SUBSIDIARIES OR ANY OTHER MATTER, INCLUDING ANY REPRESENTATION OR
WARRANTY AS TO WORKMANSHIP, PROFITABILITY, FUTURE PERFORMANCE, FITNESS FOR A PARTICULAR PURPOSE OR
NON-INFRINGEMENT OR ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY OR
COMPLETENESS OF ANY INFORMATION, DOCUMENTS OR MATERIAL TRANSMITTED, PROVIDED OR MADE AVAILABLE TO
PURCHASER OR ITS REPRESENTATIVES, INCLUDING IN ANY PHYSICAL OR ONLINE “DATA ROOMS” OR MANAGEMENT
PRESENTATIONS, INCLUDING ANY PROJECTION, FORECAST OR OTHER FORWARD-LOOKING INFORMATION AND ANY
INFORMATION CONTAINED IN ANY INFORMATION MEMORANDUM. ALL OF SUCH ADDITIONAL REPRESENTATIONS AND
WARRANTIES ARE HEREBY DISCLAIMED, AND THE COMPANY AND THE SHAREHOLDER EXPRESSLY DISCLAIM ANY AND
ALL LIABILITY RELATING TO OR RESULTING FROM THE USE OF ANY INFORMATION, DOCUMENTS OR MATERIAL
DESCRIBED IN THE PREVIOUS SENTENCE, INCLUDING ANY MARKET ANALYSIS AND FINANCIAL PROJECTIONS THAT
MAY BE CONTAINED THEREIN, OR FOR ANY ERRORS THEREIN OR OMISSIONS THEREFROM, EXCEPT FOR FRAUD.
NEITHER THE COMPANY NOR THE SHAREHOLDER IS MAKING ANY REPRESENTATION AND WARRANTY, EXPRESS OR
IMPLIED, AS TO THE CLASSIFICATION OF ANY REAL PROPERTY LEASE OF THE COMPANY AS A CAPITAL LEASE OR
AN OPERATING LEASE UNDER GAAP.



ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER AND CTH LLC




     Shareholder and CTH LLC hereby represent and warrant to Purchaser that:



     Section 4.1 Title to and Transfer of the Shares.
Except as set forth on Section 4.1 of the Company Disclosure Schedule, CTH LLC
beneficially owns and holds of record, and



31









 







following the CTH LLC Transactions and immediately prior
to the Closing, Shareholder will beneficially own and hold of record, the Shares (including
Rollover Shares), free and clear of any Liens, purchase options, calls or similar third party
rights on sale or transfer (other than restrictions imposed by applicable securities Laws),
preemptive right, limitations on voting rights or options, and Shareholder will have the authority
to dispose of such Shares pursuant to this Agreement. The transfer and delivery of the Shares
(including the Rollover Shares) by Shareholder to Purchaser and Holdings as contemplated by this
Agreement, shall transfer good title to the Shares, free and clear of all Liens, purchase options,
calls, preemptive rights or similar third party rights.



     Section 4.2 Organization; No Activity. Shareholder is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization and has all
requisite licenses, legal capacity, power and authority to carry on its business as now conducted
and to enter into and perform its obligations under this Agreement and the Transaction Documents to
which it is a party and to consummate the Contemplated Transactions. CTH LLC is duly organized,
validly existing and in good standing under the laws of California and has all requisite licenses,
legal capacity, power and authority to carry on its business as now conducted and to enter into and
perform its obligations under this Agreement and the Transaction Documents to which it is a party
and to consummate the Contemplated Transactions. CTH LLC has no assets other than the Shares, and,
after the CTH LLC Transactions, will have no other assets. Except in its capacity as a party to
the Pledge Agreement, dated March 1, 2006, between CTH LLC and Morgan Stanley & Co. Incorporated,
CTH LLC is not party to any Contract, has no liabilities and has had no business or legal activity
other than owning the Shares.



     Section 4.3 Authorization; Enforceability. This Agreement and any other Transaction
Documents to which Shareholder or CTH LLC is a party and the consummation of the Contemplated
Transactions have been duly authorized by all requisite limited partnership action by Shareholder
and all limited liability company action by CTH LLC, as applicable, and each of Shareholder and CTH
LLC has full power and authority (including limited partnership or limited liability company power
and authority, as applicable) to execute and deliver this Agreement and the Transaction Documents
to which it is a party and to perform its obligations hereunder and thereunder. This Agreement has
been duly executed and delivered by Shareholder and CTH LLC and, assuming due authorization,
execution and delivery by each of Purchaser and Holdings of this Agreement, this Agreement
constitutes the valid and legally binding obligation of each of Shareholder and CTH LLC,
enforceable against each of Shareholder and CTH LLC in accordance with its terms, except (a) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (b) as limited by laws relating
to the availability of specific performance, injunctive relief or other equitable remedies.
Following the CTH LLC Transactions, all obligations of CTH LLC hereunder shall be the obligations
of Shareholder.



     Section 4.4 Non-Contravention. The execution, delivery and performance by each of
Shareholder and CTH LLC of this
Agreement or any Transaction Document to which it is a party do not, and, assuming all Governmental
Authorizations required under the HSR Act have been obtained or made, the consummation of the
Contemplated Transactions will not: (a) violate, conflict with or result in the breach of any
provision of the Governing Documents of Shareholder



32









 







or CTH LLC or any Contract to which either is a
party or by which either is bound or (b) conflict with or violate any Law applicable to either
Shareholder or CTH LLC, as applicable.



     Section 4.5 No Brokers. Except for the obligations under the engagement letter
between Shareholder and Morgan Stanley & Co. Incorporated dated July 10, 2006, neither Shareholder
nor CTH LLC is obligated under any Contract which would result in the obligation of either
Shareholder or CTH LLC to pay any fees or incur any obligations to any Broker in connection with
the negotiations leading to this Agreement or the consummation of the Contemplated Transactions.



     Section 4.6 Litigation. There are no Actions pending or, to the Knowledge of
Shareholder, threatened against or affecting Shareholder, CTH LLC or any of their respective
Affiliates (a) challenging or seeking to restrain, delay or prohibit any of the Contemplated
Transactions or (b) preventing either Shareholder or CTH LLC from performing in all material
respects its obligations under this Agreement or any Transaction Documents to which it is a party.



     Section 4.7 Consents and Approvals. Except for the Governmental Authorizations
required under the HSR Act, no Governmental Authorizations are required on the part of Shareholder
or CTH LLC in connection with the execution and delivery of this Agreement and the consummation of
the Contemplated Transactions by Shareholder and CTH LLC. Neither Shareholder nor CTH LLC is
subject to any Governmental Order that would prevent the consummation of the Contemplated
Transactions.



ARTICLE V

REPRESENTATIONS AND WARRANTIES

OF PURCHASER AND HOLDINGS




     Each of Purchaser and Holdings hereby represents and warrants to Shareholder that:



     Section 5.1 Organization. Purchaser is a Texas corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its incorporation and has all
requisite licenses, legal capacity, power and authority to carry on its business as now conducted
and to enter into and perform its obligations under this Agreement and the Transaction Documents to
which it is a party and to consummate the Contemplated Transactions. Holdings is a Delaware
corporation duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all requisite licenses, legal capacity, power and
authority to carry on its
business as now conducted and to enter into and perform its obligations under this Agreement
and the Transaction Documents to which it is a party and to consummate the Contemplated
Transactions.



     Section 5.2 Authorization; Enforceability. This Agreement, any other Transaction
Document to which Purchaser or Holdings is a party, and the consummation of the Contemplated
Transactions have been duly authorized by all requisite corporate action by each of Purchaser and
Holdings, and each of Purchaser and Holdings has full power and authority (including corporate
power and authority) to execute and deliver this Agreement and the Transaction Documents to which
it is a party and to perform its obligations hereunder and thereunder.



33









 







Assuming due authorization,
execution and delivery by Shareholder and CTH LLC of this Agreement, this Agreement constitutes the
valid and legally binding obligation of each of Purchaser and Holdings, enforceable against it in
accordance with its terms except (a) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of
creditors’ rights generally and (b) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies.



     Section 5.3 Non-Contravention. Except as set forth on of the Section 5.3
Purchaser Disclosure Schedule, the execution, delivery and performance by each of Purchaser or
Holdings of this Agreement or any Transaction Document to which it is a party do not, and, assuming
all Governmental Authorizations required under the HSR Act have been obtained or made, the
consummation of the Contemplated Transactions will not: (a) violate, conflict with or result in the
breach of any provision of the Governing Documents of either Purchaser or Holdings or any material
Contract to which either Purchaser or Holdings is a party or (b) conflict with or violate any Law
applicable to either Purchaser or Holdings, as applicable.



     Section 5.4 Government Consents. Except for the Governmental Authorizations required
under the HSR Act, no Governmental Authorizations are required on the part of either Purchaser or
Holdings in connection with the execution and delivery of this Agreement and the consummation of
the Contemplated Transactions by either Purchaser or Holdings. Neither Purchaser nor Holdings is
subject to any Governmental Order that would prevent the consummation of the Contemplated
Transactions.



     Section 5.5 Litigation. There are no Actions pending or, to the Knowledge of
Purchaser, threatened against or affecting Purchaser, Holdings or any of their respective
Affiliates (a) challenging or seeking to restrain, delay or prohibit any of the Contemplated
Transactions or (b) preventing either Purchaser or Holdings from performing in all material
respects its respective obligations under this Agreement or any Transaction Documents to which it
is a party.



     Section 5.6 Investment Intent. Each of Purchaser and Holdings acknowledges that the
Shares have not been registered under Securities Act and that the Shares may not be resold absent
such registration or unless an exemption therefrom is available. Each of Purchaser and Holdings
qualifies, or as of the Closing will qualify, as an “accredited investor” as such term is defined
in Rule 501(a) promulgated pursuant to the Securities Act. The Shares to be received by each of
Purchaser and Holdings at the Closing are being acquired for investment for its own account not as
a nominee or agent, and not with a view to the resale or distribution of any part thereof, and
neither Purchaser nor Holdings has any present intention of selling, granting any participation in,
or otherwise distributing the same. The acquisition by Purchaser and Holdings of any of the Shares
shall constitute confirmation of the representation by each of Purchaser and Holdings that it does
not have any Contract, undertaking, or arrangement with any person to sell, transfer or grant
participations to such person or to any third person, with respect to any of the Shares.



     Section 5.7 Knowledge of Industry and Representation by Advisors.



34









 





          (a) Each of Purchaser and Holdings acknowledges that (i) it has knowledge, experience and
expertise in business and financial matters and the motion picture exhibition industry and (ii) it
has the capability of understanding and evaluating the risks and merits associated with its
acquisition of the Shares pursuant to this Agreement and its respective participation in the
Contemplated Transactions.




          (b) Each of Purchaser and Holdings acknowledges that it: (i) has read this Agreement; (ii) has
been represented in the preparation, negotiation and execution or this Agreement by legal counsel
of its own choice or has voluntarily declined to seek such counsel; and (iii) understands the terms
and consequences of this Agreement and is fully aware of the legal and binding effect of this
Agreement. Purchaser and Holdings each acknowledge with respect to itself that it is not in a
disparate bargaining position with the Shareholder.




          (c) Each of Purchaser and Holdings acknowledges with respect to itself that it has been
represented or advised by advisors of its own choice, including financial advisors and tax
advisors, that have assisted Purchaser or Holdings, as applicable, in understanding and evaluating
the risks and merits associated with Purchaser’s and Holdings’ acquisition of the Shares pursuant
to this Agreement and Purchaser’s and Holdings’ respective participation in the Contemplated
Transactions.




     Section 5.8 Disclosure of Information. Purchaser and Holdings each acknowledge with
respect to itself that it and its Representatives have been permitted access to the books and
records, facilities, equipment, Tax Returns, contracts, and other properties and assets of the
Company and its Subsidiaries that it and its Representatives have requested to see or review, and
that it and its Representatives have had an opportunity to meet with the officers and employees of
the Company and its Subsidiaries that it and its Representatives have requested to meet with.
Purchaser acknowledges that (a) none of Shareholder, CTH LLC, the Company or any other Person has
made any representation or warranty, express or implied, as to the Company’s Business, the Company,
its Subsidiaries or the
accuracy or completeness of any information regarding the Company’s Business, the Company, or
its Subsidiaries furnished or made available to Purchaser and its Representatives, except as
expressly set forth in the Transaction Documents, (b) neither Purchaser nor Holdings has relied on
any representation or warranty from Shareholder, CTH LLC, the Company or any other Person in
determining to enter into this Agreement, except as expressly set forth in this Agreement and (c)
except as expressly provided otherwise in the Transaction Documents or in the case of fraud, none
of Shareholder, CTH LLC, or any of their respective Affiliates (including the Company and its
Subsidiaries), their respective Representatives or any other Person shall have or be subject to any
liability to Purchaser or Holdings or any other Person resulting from the distribution to Purchaser
or Holdings, or Purchaser’s or Holdings’ use of, any such information, including any information,
documents or material made available to Purchaser or Holdings in any physical or online “data
rooms,” management presentations, information memorandum or in any other form in expectation of any
transaction contemplated hereby.



     Section 5.9 Projections. In connection with Purchaser’s and Holdings’ investigation of the
Company and the Subsidiaries, Purchaser and Holdings have each received from the Company and its
Representatives certain projections, forecasts and business plan information, including
projections, forecasts and business plan information relating to the construction



35









 







schedule, other
milestones and costs related to the Pipeline Theaters and the revenues, expenses, costs, dilution
of revenues and depreciation of assets related the Pipeline Theaters and to all of the Company’s
other theaters. Each of Purchaser and Holdings acknowledges and agrees that there are
uncertainties inherent in attempting to make such projections, forecasts and plans, that each of
Purchaser and Holdings is familiar with such uncertainties, that there can be no assurances that
the projections, forecasts and plans are accurate or that the projections, forecasts and plans will
be realized, that each of Purchaser and Holdings is taking full responsibility for making its own
evaluation of the adequacy and accuracy of all projections, forecasts and plans so furnished to it,
and that each of Purchaser and Holdings shall have no claim against the Company, Shareholder, CTH
LLC or their respective Affiliates and Representatives with respect thereto, except in the case of
fraud and provided that nothing in this Section 5.9 shall modify or limit in any way any of
the representations and warranties contained in this Agreement. Accordingly, each of Purchaser and
Holdings acknowledges and confirms that (a) the Company, Shareholder, CTH LLC and their respective
Affiliates and Representatives have made no representations or warranties, express or implied, with
respect to, and shall not be liable to Purchaser, Holdings or any of their respective Affiliates or
Representatives, with respect to any such projections, forecasts or plans, (b) except as expressly
set forth in Article III of this Agreement, the Company, Shareholder, CTH LLC and their
respective Affiliates and Representatives have made no representations or warranties, express or
implied, relating to the Pipeline Theaters, including as to the status or content of any plans,
specifications, letters of intent, memoranda of understanding, agreements or other documents with
respect to such theaters or properties, (c) neither Purchaser nor Holdings has relied on the
fulfillment or realization of any projection, forecast or plan received from Shareholder, CTH LLC,
the Company or any of their respective Affiliates or Representatives or any other Person in
determining to enter into this Agreement, and (d) any such reliance would be unreasonable.



     Section 5.10 Access. Notwithstanding anything to the contrary in this Agreement and except
as specifically set
forth in the last sentence of Section 3.8, each of Purchaser and Holdings acknowledges and
agrees that neither the Company nor Shareholder makes any representation or warranty relating to,
and under no circumstances shall the Company, Shareholder or CTH LLC be liable to Purchaser,
Holdings or any of their respective Affiliates for any amounts (including Losses under Article
IX) suffered or incurred by Purchaser, Holdings or any of their respective Affiliates in
connection with any claim, action, litigation, suit, arbitration, proceeding, investigation, or
other legal or administrative proceeding arising out of, resulting from or relating to any Law
pertaining to the access of disabled persons to public accommodations, or prohibiting disability
discrimination by public accommodations (a “Disability Law”) including, Title III of
Americans with Disabilities Act of 1990, as amended, 42 U.S.C. §§ 12101, et seq., or any rules or
regulations promulgated thereunder, the Rehabilitation Act of 1973, 29 U.S.C. §§ 701, et seq.,
California Unruh Act, California Civil Code §§ 51, et seq., the California Health and Safety Code §
19955, et seq., the California Blind and Other Physically Disabled Persons Act, California Civil
Code §§ 54, et seq., Title 24 of the California Building Code, and any other state or local Law,
administrative statute, rule, architectural guideline, building code, or any other Law of similar
purpose and effect.



     Section 5.11 Sufficient Funds. Purchaser has received, accepted and agreed to a
commitment letter from Lehman Brothers, Inc. and Morgan Stanley Senior Funding, Inc. (the
“Purchaser Debt Financing Commitment Letter”), committing such entities to provide debt



36









 







financing for the Contemplated Transactions to Purchaser, subject to the terms and conditions set
forth therein (such debt financing, the “Debt Financing”). A true and complete copy of the
executed Purchaser Debt Financing Commitment Letter is attached hereto as Exhibit G and the
Purchaser Debt Financing Commitment Letter is in full force and effect and Purchaser is not in
breach of any of the terms thereof. As of the date of this Agreement, Purchaser has paid in full
(or has caused to be paid in full) any and all commitment fees and other fees required to be paid
on or before the date of this Agreement pursuant to the terms of the Purchaser Debt Financing
Commitment Letter. Purchaser will have available to it in the aggregate at the Closing Date
sufficient funds to consummate the Contemplated Transactions, including the payments it is required
to make pursuant to Section 2.1(a), assuming (i) the Debt Financing is obtained on
substantially the same terms as described in the term sheets attached to the Purchaser Debt
Financing Commitment Letter and (ii) Shareholder shall have contributed the Rollover Shares in
exchange for Holdings Stock.



     Section 5.12 No Brokers. Except as set forth on Section 5.12 of the Purchaser
Disclosure Schedule, neither Purchaser nor Holdings is obligated under any Contract that would
result in the obligation of the Purchaser, Holdings or their respective Affiliates to pay any fees
or incur any obligations to any Broker in connection with the negotiations leading to this
Agreement or the consummation of the Contemplated Transactions.



ARTICLE VI

ADDITIONAL AGREEMENTS




     Section 6.1 Access and Investigation. Between the date of this Agreement and the
Closing Date and upon reasonable advance notice from Purchaser, the Company will, and will cause
its Subsidiaries and their Representatives to, afford Purchaser and its Representatives (including
its financing sources and their counsel, accountants, and other representatives) reasonable access
during normal business hours to the Company’s and its Subsidiaries’ personnel, Representatives,
properties, landlords, Contracts, Tax Returns, books and records and other financial, operating and
other data and information as Purchaser may reasonably request. Prior to the Closing, all
information obtained by Purchaser and its Representatives pursuant to this Section 6.1
shall be kept confidential in accordance with the Confidentiality Agreement. Notwithstanding the
foregoing, none of Shareholder, CTH LLC, the Company or its Subsidiaries shall be required to
provide access to any information, property or personnel if (a) such Party believes in good faith
that such access is subject to any confidentiality obligations, provided that, at the
request of Purchaser, the Company shall use commercially reasonable efforts to have such
obligations waived, or would be reasonably likely to jeopardize such Party’s attorney-client, work
product or similar legal privilege; (b) any applicable Law may, in the good faith judgment of such
Party’s outside counsel, require such Party to restrict or prohibit access to any such information,
properties or personnel; or (c) such access would unreasonably and materially disrupt the
businesses and operations of such Party. Prior to the Closing (x) none of Purchaser, its
Affiliates or its Representatives shall contact or communicate, directly or indirectly, with any
lessor (other than Shareholder) under any Real Property Lease for the purpose of discussing any
Real Property Lease, any Pipeline Theater, the Company’s Business or the Contemplated Transactions
without, in each such instance, permitting the Company, by providing reasonable prior notice to
Company, to fully participate in any and all conferences, telephone conversations and other
communications between Purchaser, its Affiliates or Representatives and any such



37









 







lessor and (y)
Purchaser shall, and shall cause its Affiliates or Representatives to, copy Shareholder on all
written and electronic communications between such Persons and any such lessor when sent. Upon
Purchaser’s reasonable request, prior to the Closing Shareholder, the Company and its Subsidiaries
shall use their commercially reasonable efforts to assist Purchaser with (i) its preparation for
the post-Closing integration of the Company’s information technology systems with the Purchaser’s
information technology systems, including, without limitation (A) the development of software
interfaces between, and integration of, the Company Proprietary Software and Purchaser’s software;
and (B) the integration of historical data of the Company into Purchaser’s information technology
systems, it being understood that no actual integration of technology systems shall occur until
after Closing, and (ii) subject to the immediately preceding sentence, communication with the
Company’s or its Subsidiaries’ landlords with respect to any requests of Purchaser’s lenders with
respect to the Debt Financing. Upon the consummation of the Closing, the Parties hereto agree that
this Section 6.1 shall terminate and forthwith become null and void in all respects and
cease to have any further effect.



     Section 6.2 Conduct of the Company’s Business Prior to Closing. (a) Except as
otherwise contemplated by this Agreement or as set forth on Section 6.2 of the Company
Disclosure Schedule, between the date of this Agreement and the Closing Date, the Company will, and
will cause its Subsidiaries to, (i) conduct the Company’s Business in the ordinary course of
business, consistent with past practice and in accordance with applicable Law with no less
diligence and effort than would be applied in the absence of this Agreement, (ii) use commercially
reasonable efforts to (x) preserve intact, in all material respects, the current business
organization (including the legal entities comprising such) of the Company and its Subsidiaries
(including the relationships between the Company and its Subsidiaries’ and their respective
directors, officers, executives, and managers, although the Company shall not be required to pay,
or promise to pay, any consideration (other than compensation to which such individuals are
currently entitled as directors or employees) as an inducement to continue their employment with
the Company), and (y) maintain relations and goodwill with suppliers, customers, landlords,
employees, creditors, and movie studios with whom the Company and its Subsidiaries has
relationships and with the communities in which the Company has theaters or Pipeline Theaters, all
in the ordinary course of business, consistent with past practice and with a view to preserving for
Purchaser and Holdings the Company’s Business and the assets used therein and the goodwill
associated therewith, (iii) operate its cash management in accordance with past practices,
including with respect to the payment of Indebtedness (subject to Section 7.2(l)), purchase
of inventory, provisions of services, payment of accounts payable and accrued liabilities and
incurrence of and payment of or financing for capital expenditures, (iv) maintain the material
tangible assets of the Company and its Subsidiaries in good repair and condition (excluding normal
wear and tear), and (v) pay all Taxes as such Taxes become due and payable consistent with past
practice.



          (b) Except as otherwise contemplated by this Agreement, between the date of this Agreement and
the Closing Date, the Company will not, and will cause its Subsidiaries not to, without the prior
consent of Purchaser:





          (i) make any modifications or amendments to any Listed Agreement, Real Property Lease,
Pipeline Construction Agreement, Pipeline Architectural Agreement (except in each case in
connection with any action permitted pursuant to subsections (xv) and (xvi) below) or
material Governmental Authorization or waive or assign any



38









 







right thereunder;
provided that (A) the Company may enter into any extension or renewal of a Listed
Agreement on a month-to-month basis without the prior consent of Purchaser; (B) the Company
may execute or provide any updated schedules, bids or specifications with respect to any
Pipeline Construction Agreement or Pipeline Architectural Agreement or any amendment, waiver
or change with respect to any Pipeline Construction Agreement or Pipeline Architectural
Agreement with respect to rights of the Company (1) prior to the commencement of design, (2)
prior to the opening of any theater or (3) prior to the commencement of the Company’s work
as a tenant for any Pipeline Theater without the prior consent of Purchaser,
provided that such schedule, bid, specification, amendment, waiver or change will
not require any capital expenditure that will result in a breach of Section
6.2(b)(xvi); and (C) with respect to any estoppel, subordination, non-disturbance and
attornment, exhibits, consents, review of title, recording memoranda of lease or geotech
reports required by any Real Property Lease, the Company shall provide immediately to
Purchaser all documentation required under the Real Property Lease for review and comment,
which comments shall be consistent
with the terms of the Real Property Lease and shall be provided to the Company no later
than five (5) Business Days prior to the required date of delivery or execution, as
applicable, under the Real Property Lease, provided that the Company has provided to
Purchaser such documents at least five (5) days in advance, provided further that if
the time period for delivery or execution, as applicable, of such documentation under the
Real Property Lease is less than five (5) Business Days, the Company shall use its
commercially reasonable efforts to provide the documentation to Purchaser and to obtain
comments from Purchaser prior to the required date of delivery or execution, and
provided further that the Company may deliver or execute such documentation
on the required date of delivery or execution under the Real Property Lease without prior
consent or comment from the Purchaser if the Company has taken all actions required by this
clause (C) and if such delivery or execution is necessary to prevent a breach or default by
the Company under the Real Property Lease.




          (ii) amend or otherwise change its Governing Documents;




          (iii) issue, sell, contract to issue or sell, pledge, dispose of, grant, encumber or
authorize the issuance, sale, pledge, disposition, grant or encumbrance of (1) any shares of
capital stock or any membership interests of the Company or its Subsidiaries, as applicable,
or (2) any options, warrants, convertible securities or other rights of any kind to acquire
any shares of such capital stock, or any other ownership interest of the Company or its
Subsidiaries, or (3) any material portion of the assets of the Company or its Subsidiaries;




          (iv) reclassify, combine, split, subdivide, redeem, purchase or otherwise acquire,
directly or indirectly, any of its capital stock or other securities or effect any like
change in the capitalization of the Company or its Subsidiaries, declare or pay any
dividends or other cash distributions upon any ownership interests of the Company or any of
its Subsidiaries, or make any loans to Shareholder;




          (v) except as may be required by applicable Law, enter into, adopt or amend or
terminate any employment agreement, bonus, profit sharing, compensation,



39









 







severance,
termination, stock option, stock appreciation right, restricted stock, performance unit,
stock equivalent, stock purchase agreement, pension, retirement, deferred compensation,
employment, health, life, or disability insurance, dependent care, severance or other
employee benefit plan agreement, trust, fund or other arrangement for the benefit or welfare
of any director, officer or employee in any manner;




          (vi) increase in any manner the compensation or fringe benefits of any director,
officer or employee, other than salary or wage increases in the ordinary course of business
to take effect on or after the first pay period following September 30, 2006 and not to
exceed (A) 15% with respect to any director, officer or employee with an annual base salary
less than $75,000, (B) 9% with respect to any director, officer or employee with an annual
base salary greater than or equal to $75,000 and (C) 4.5% on an aggregate basis for all
directors, officers and employees, each as set forth in the Agreement Date Salary Schedule,
or pay any benefit not required by any plan or arrangement as in effect as of the date
hereof;




          (vii) hire additional employees of the Company or its Subsidiaries at the corporate
office, or without prior notice to Purchaser, terminate without good cause the employment of
any employees at the corporate office of the Company or any of its Subsidiaries;
provided, however, that nothing in this subsection shall require Purchaser’s
consent for the hiring of temporary employees entitled to total annual compensation of less
than $75,000, who are not entitled to severance and who do not receive written employment
agreements;




          (viii) make or change any election, change an annual accounting period, adopt or change
any accounting method, file any amended Tax Return, enter into any closing agreement, settle
any Tax claim or assessment, surrender any right to claim a refund of Taxes, consent to any
extension or waiver of the limitation period applicable to any Tax claim or assessment, or
take any other similar action, or omit to take any action relating to the filing of any Tax
Return or the payment of any Tax, if such election, adoption, change, amendment, agreement,
settlement, surrender, consent or other action or omission would reasonably be expected to
have the effect of materially (i) increasing the present or future Tax liability or (ii)
decreasing any present or future Tax asset of the Company, Purchaser, or any of their
respective Subsidiaries or Affiliates, except in each case as may be required by Law;




          (ix) permit any insurance policy naming the Company or any of its Subsidiaries as a
beneficiary or loss payee to expire, or to be canceled or terminated, unless a comparable
insurance policy reasonably acceptable to Purchaser is obtained and in effect, or enter into
any new insurance policy other than a renewal of a previously existing policy;




          (x) adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of the Company or any
of its Subsidiaries or otherwise permit the corporate existence of the Company or its
Subsidiaries or the rights or franchises or any license, permit or authorization under which
its business operates to be suspended, lapsed or revoked;



40









 






          (xi) enter into Contracts or other agreements (including non-binding letters of intent)
to acquire, sell, develop, design, construct (other than with respect to Pipeline Theaters),
lease, finance or operate movie theaters;




          (xii) except with respect to the License Agreement, assign, license or otherwise
transfer any Intellectual Property or allow to lapse any registrations or applications for
registration of Intellectual Property owned by the Company or one of its Subsidiaries;




          (xiii) incur, assume, or guaranty any liabilities or Indebtedness of any kind other
than ordinary course trade payables or draws on the revolving credit facility under the
Credit Agreement not to exceed $5,000,000 in the aggregate;




          (xiv) cancel any Indebtedness owed to the Company or its Subsidiaries or waive any
material claims or rights pertaining to the business of the Company or any of its
Subsidiaries;




          (xv) dispose of any assets with a fair market value in excess of $250,000 (other than
any such disposition associated with closure of any theatre being replaced with a new
theatre as set forth on Section 6.2(b) of the Company Disclosure Schedule);




          (xvi) make any capital expenditure with respect to any Pipeline Theater that would
result in aggregate expenditures for such Pipeline Theater to exceed 110% of the amounts set
forth on Section 6.2(b) of the Company Disclosure Schedule with respect to such
Pipeline Theater;




          (xvii) make any single capital expenditure (or related capital expenditures) (excluding
capital expenditures with respect to any Pipeline Theater) in excess of $100,000 or
aggregate capital expenditures in excess of (A) $500,000 through the date that is sixty (60)
days following the date of this Agreement, (B) an additional $250,000 thereafter (for a
total of $750,000) plus (C) $324,000 in the aggregate with respect to the SouthCoast 16 and
the Huntington Beach 20 theaters;




          (xviii) change, in any material respect, any accounting, financial reporting, inventory
or credit allowance principle, practice, method or policy used by the Company or any of its
Subsidiaries;




          (xix) compromise or settle any lawsuit or claim (including any lawsuit or claim
involving as a party any Governmental Authority) if such settlement (i) involves individual
payments by the Company or any of its Subsidiaries in respect of any such lawsuits or claims
after the Closing (or forgiveness of amounts payable to the Company to or any of its
Subsidiaries) in excess of $100,000 (or $400,000 in the aggregate) or (ii) would reasonably
be expected to have a Company Material Adverse Effect or (iii) involves injunctive or other
equitable relief; provided that, without the consent of Purchaser, the Company shall
be permitted to make the following improvements related to any Disability Law, up to $50,000
per theater location and a total aggregate value of



41









 







$250,000: modifications to theater
exteriors, sidewalks, signage, rest rooms, striping, and ordinary course repairs and
maintenance;




          (xx) merge or consolidate with, or agree to merge or consolidate with, or purchase
substantially all of the assets of, or otherwise acquire, any business, business
organization or division thereof, or any other Person;




          (xxi) enter into any transaction, agreement, contract or arrangement that would be
required to be disclosed under Sections 3.12(a) or 3.21 of the Company
Disclosure Schedule; or




          (xxii) enter any change order related to, revision, amendment, modification or waiver
of any Pipeline Construction Agreement or Pipeline Architectural
Agreement that will result in payments by the Company or any of its Subsidiaries in
violation of subsection ((xvi)) above;




          (xxiii) sell or otherwise transfer any of the Fandango Shares; or




          (xxiv) agree to do any of the foregoing.



     Section 6.3 Consents; Approvals. (a) The Company shall use its commercially reasonable
efforts to obtain (and shall refrain from taking any willful action that would impede obtaining)
all consents, waivers, approvals, authorizations or orders needed to consummate the sale of the
Shares and the Contemplated Transactions (including all requisite consents under the Real Property
Leases); provided that Purchaser shall have the right to approve all notices to and
requests for consent prior to their being sent to any third party and further
provided that the Company shall not be required to pay any consideration, monetary or
otherwise, that is more than $500 individually or agree to any material concessions, in order to
obtain any such consents, waivers, approvals or authorizations unless Purchaser shall agree to bear
the cost thereof.



     (b) The Company and Purchaser shall file the notification report, and all other documents to
be filed in connection therewith, required by the HSR Act and the notification rules promulgated
thereunder with the United States Federal Trade Commission and the United States Department of
Justice as soon as practicable following the date hereof, but in any event within five Business
Days following the date hereof (the date on which such filing is made, the “Original Filing
Date”). Purchaser shall pay directly to the applicable Government Antitrust Entity the
applicable HSR Act filing fee required in connection with any HSR notification required in
connection with the Contemplated Transactions, including the Rollover. The Company and Purchaser
shall respond promptly to any request for additional information that may be issued by either the
Federal Trade Commission or the Department of Justice. Subject to the terms and conditions herein,
Purchaser and the Company shall use commercially reasonable efforts to cause the waiting periods
under the HSR Act to terminate or expire at the earliest possible date after the Original Filing
Date (it being understood that this provision is not intended to require any Party to seek early
termination). Without limiting the generality of the Company’s undertakings pursuant to this
Section 6.3(b), the Company shall, in each case with the consent of Purchaser:



42









 






          (i) use its commercially reasonable efforts to prevent the entry in a judicial or
administrative proceeding brought under any antitrust law by a Government Authority with
jurisdiction over the enforcement of any applicable antitrust laws (“Government
Antitrust Entity”) or any other party of any permanent or preliminary injunction or
other order that would make consummation of Purchaser’s acquisition of the Company and the
Company’s Business in accordance with the terms of this Agreement unlawful or that would
prevent or delay such consummation; provided that, Purchaser and its counsel shall
be responsible for all discussions with any Government Antitrust Entity (after consultation
with the Company and its counsel) to the maximum extent permitted by Law and except as
required by any Government Antitrust Entity; and




          (ii) take promptly, in the event that such an injunction or order has been issued in
such a proceeding, any and all steps, including the appeal thereof or the posting of a bond,
necessary to vacate, modify or suspend such injunction or order so as to permit such
consummation on a schedule as close as possible to that contemplated by this Agreement.



          (c) Subject to applicable Law and subject to all applicable privileges, including the
attorney-client privilege, Purchaser and the Company will consult and cooperate with one another in
connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions
and proposals made or submitted by or on behalf of any Party hereto relating to proceedings under
the HSR Act or any other applicable merger control or similar Law, and shall promptly inform the
other of any oral communication with, and provide copies of written communications with, any
Governmental Antitrust Entity regarding any such filings or this transaction.




          (d) Notwithstanding anything to the contrary in this Section 6.3 or elsewhere in this
Agreement, Purchaser shall not be required to agree to (i) material concessions in connection with
any third party consents, (ii) incur any material liability or obligation of any kind, (iii) except
as contemplated in clause (iv) below, enter into a consent decree (or other similar agreement) with
the Federal Trade Commission, the Department of Justice or any other Governmental Authority, or
(iv) except for the divestiture of no more than 75 screens in the aggregate, agree to any sale,
transfer, license, separate holding, divestiture or other disposition of, or to any prohibition of,
or to any limitation on, the acquisition, ownership, operation, effective control or exercise of
full right of ownership of any asset of the Company’s Business or the business of the Purchaser and
its Affiliates. Purchaser shall not be required to pursue antitrust approval under the HSR Act for
a period of more than 150 days following the Original Filing Date, and Purchaser shall thereafter,
in its sole discretion, be entitled to terminate this Agreement pursuant to Section
8.1(a)(vi).




     Section 6.4 Notification. Upon obtaining knowledge thereof, the Company shall give
prompt notice to Purchaser, and Purchaser shall give prompt notice to the Company, of (a) the
occurrence or non-occurrence of any event after the date hereof, the occurrence or non-occurrence
of which has caused or would be likely to cause any representation or warranty contained in this
Agreement to be untrue or inaccurate such that the conditions to closing set forth in Section
7.2(a) and Section 7.3(a), as the case may be, shall not be met, and (b) any failure of
the Company, CTH LLC, Shareholders, Purchaser or Holdings, as the case may be, to



43









 







comply with or
satisfy any covenant, condition or agreement to be complied with or satisfied by it after the date
hereof such that the conditions to Closing set forth in Section 7.2(a) and Section
7.3(a), as the case may be, shall not be met. Should any such occurrence or non-occurrence
referenced herein require any change in the Company Disclosure Schedule or the Shareholder
Disclosure Schedule, the Company or Shareholder, as the case may be, shall deliver to Purchaser a
supplement to the Company Disclosure Schedule or Shareholder Disclosure Schedule, as applicable,
specifying such change; provided that the Company and Shareholder shall only be entitled to
update, amend or modify the Company Disclosure Schedule or the Shareholder Disclosure Schedule, as
the case may be, after the date of this Agreement until the Closing Date (the “Update
Period”) to reflect factors,
circumstances or events first arising or, in the case of representations given to the
Company’s Knowledge, becoming known to the Company, during the Update Period or to reflect factors,
circumstances or events arising or resulting from any action taken or not taken by the Company, CTH
LLC or Shareholder as a result of Purchaser’s consent pursuant to Section 6.2. Purchaser
will be deemed to have accepted such supplement to the Company Disclosure Schedule or the
Shareholder Disclosure Schedule (i) where the update is made to reflect any action taken or not
taken by the Company, CTH LLC or Shareholder as a result of Purchaser’s consent pursuant to
Section 6.2 and (ii) in all other cases, unless Purchaser delivers written notice of its
objection to Shareholder and the Company within ten (10) Business Days after the date the
supplement is delivered. If Purchaser delivers a written notice of its objection to such
supplement to the Company Disclosure Schedule or the Shareholder Disclosure Schedule, as
applicable, Purchaser shall have, in addition to any other rights and remedies at law or equity,
the right to terminate this Agreement as provided in Section 8.1(a)(iv). Upon the
acceptance or deemed acceptance of any such supplement by Purchaser, the information contained in
such supplement will be deemed to become part of the Company Disclosure Schedule or the Shareholder
Disclosure Schedule, as applicable, and will be deemed to qualify and constitute an exception to
the applicable representations and warranties of the Company, CTH LLC or Shareholder, as
applicable. The delivery of any such notice pursuant to this Section 6.4 shall not be
deemed an admission or an acknowledgement (i) that the subject matter of such notice is material or
would reasonably be expected to have a Company Material Adverse Effect or is outside of the
ordinary course of business or inconsistent with past practice, or (ii) that there has occurred an
actual or anticipatory breach of, or failure to comply with or satisfy, any representation,
warranty, covenant, condition or agreement.



     Section 6.5 No Negotiation. Up until the Closing, Shareholder, CTH LLC and the
Company will, and will cause each of their respective Affiliates and Representatives to,
discontinue (i) any discussions, negotiations or other interactions with any Person (other than
Purchaser and Holdings) relating to any Alternative Transaction and (ii) providing any confidential
information or data with respect to the Company or its Subsidiaries to any Person other than to
Purchaser, Holdings and their respective Representatives for the purpose of or otherwise related to
proposing, evaluating or effecting an Alternative Transaction. Until such time, if any, as this
Agreement is terminated pursuant to Article VIII or the Closing occurs, Shareholder, CTH
LLC and the Company will not, and will cause their respective Affiliates and Representatives to
not, entertain, solicit, initiate, encourage or respond to any inquiries or proposals from, or
negotiate with, any Person (other than Purchaser or Holdings) relating to any such Alternative
Transaction involving any of the Company or its Subsidiaries. The Company shall promptly, but in
no event later than two days after its occurrence, notify Purchaser if any Person makes any
proposal, offer, inquiry or contact with respect to an Alternative Transaction



44









 







and will provide to
Purchaser the identity of such Person, the nature of the offer, inquiry or proposal, the terms of
any proposal and, in each case, the Company’s, CTH LLC’s or Shareholder’s response thereto, as
applicable.



     Section 6.6 Trademarks, Brand Names, Etc. As promptly as practicable after the
Closing Date, Purchaser shall cause the Company and its Subsidiaries to remove the name “Syufy” and
any trademarks, trade names, brand names,
trade dress or logos containing such names which are listed and specifically identified on
Section 6.6 of the Company Disclosure Schedule from all Internet sites, labels, stationery
or office forms of the Company and its Subsidiaries. Thereafter, other than pursuant to any
agreement between Shareholder or its Affiliates (other than the Company and its Subsidiaries) and
the Company or its Subsidiaries, Purchaser shall neither use nor permit any of its Affiliates to
use such name as a trademark or service mark or any trademark, trade name, brandmark, brand name,
trade dress or logo containing such name in connection with the Company, its Subsidiaries or
otherwise.



     Section 6.7 Further Action. Except as otherwise provided herein, each of the Parties
shall use its best efforts to take, or cause to be taken, all appropriate action, do or cause to be
done all things necessary, proper or advisable under applicable Law, and execute and deliver such
documents and other papers, as may be required to transfer, convey, grant and confirm to and vest
in Purchaser and Holdings good and marketable title to all of the Shares free and clear of all
Liens, purchase options, calls or similar third party rights.



     Section 6.8 Tax Matters.



          (a) Whenever it is necessary for purposes of this Agreement to determine the liability for
Non-Income Taxes of the Company or any of its Subsidiaries for a taxable year or period that begins
before and ends after the Closing Date (a “Straddle Period”), the determination shall be
made by assuming that such entity had a taxable year which ended at the close of business on the
Closing Date.




          (b) Purchaser shall prepare and timely file, or cause to be prepared and timely filed when due
(including extensions), any Tax Return that is required to be filed after the Closing Date to the
extent such Tax Return is with respect to the operations, assets or activities of the Company or
any of its Subsidiaries. To the extent an Income Tax Return is required to be filed after the date
hereof and on or before the Closing Date with respect to the operations, assets or activities of
the Company or any of its Subsidiaries, the Company shall prepare and timely file, or cause to be
prepared and timely filed, such return; provided, however, that the Company shall provide any such
Income Tax Return to Purchaser for its review and comment at least 60 days prior to the due date of
such return and the Company shall file or cause to be filed such return only after obtaining
Purchaser’s consent (not to be unreasonably withheld or delayed).




          (c) Shareholder, at its own expense, shall provide to Purchaser all information necessary in
Purchaser’s reasonable discretion to completely and accurately report any transactions that (i)
occurred out of the ordinary course of business, including the Special Dividend and the 2006
Restructuring, (ii) occurred on or before the Closing, and (iii) will be reported on a Tax Return
(including any Form 1099) or that will affect a Tax Return that is required to be filed by
Purchaser or the Company after the Closing Date. This information

45









 








includes the information required to report on Form 1099 (and any similar form filed with
state, local or foreign Tax authorities) the portion of the Special Dividend that is properly
treated as a dividend for Tax purposes.




          (d) Each of Purchaser and Shareholder shall, and shall cause its respective Subsidiaries and
Affiliates to (i) retain all books and records with respect to Tax matters pertinent to the Company
and each of its Subsidiaries relating to any taxable period beginning before the Closing Date until
the sixth anniversary of the Closing Date, and abide by all record retention agreements entered
into with any Governmental Authority, and (ii) give the other Party reasonable written notice prior
to transferring, destroying or discarding any such books and records and, if the other Party so
requests, the notifying Party shall, and shall cause the Company and each of its Subsidiaries to,
allow each Party to take possession of such books and records at such other Party’s expense.
During the period such books and records with respect to Tax matters are retained each Party shall
provide, or shall cause its Subsidiaries and Affiliates to provide, as applicable, reasonable
access to the other Party during normal working hours, including the right to make copies, at such
other Party’s expense, in connection with any audit or other proceeding with respect to Taxes or
any claim for indemnification with respect to Taxes. Notwithstanding anything in this Agreement to
the contrary, Shareholder shall, and shall cause its respective Subsidiaries and Affiliates to, at
Shareholder’s expense, transfer to Company, such that Company has in its possession as of and after
the Closing Date, all books and records (including Tax work papers and Tax Returns) for periods
through the Closing Date that may be required for the Company to conduct an earnings and profits
study with respect to all periods up to and including the Closing Date.




          (e) Purchaser, the Company and the Shareholder further agree, upon request, to use reasonable
efforts to obtain any certificate or other document from any Governmental Authority or any other
Person as may be necessary to mitigate, reduce or eliminate any Tax that could be imposed,
provided that obtaining such certificate or other document may not reasonably be expected
to adversely affect Purchaser, the Company, any of the Subsidiaries or the Shareholder.




          (f) Within ninety (90) days of Purchaser’s request, Shareholder shall prepare and provide to
Purchaser such Tax information as is reasonably requested by Purchaser with respect to any
operations, ownership, assets or activities of the Company and each of the Subsidiaries for periods
prior to the Closing Date, including pro forma Tax Returns, to the extent such information is
relevant to the preparation of any Tax Return that Purchaser is required to prepare and file under
this Section 6.8 or under applicable Law. Purchaser shall reimburse Shareholder for any
reasonable out-of-pocket costs in preparing any such Tax information.




          (g) Purchaser, the Company and its Subsidiaries and Shareholder shall cooperate fully, as and
to the extent reasonably requested by the other Party, in connection with the filing of Tax Returns
pursuant to this Article VI and any audit, litigation or other proceeding with respect to
Taxes.




     Section 6.9 Tax Indemnity. Notwithstanding anything in this agreement to the contrary,
Shareholder shall indemnify Purchaser, its Affiliates, the Company and its Subsidiaries




46










 






and each of their respective officers, directors, employees, agents, representatives,
Affiliates, successors and permitted assigns shall (the “Purchaser Indemnified Parties”)
from and against:




          (a) any and all Taxes, liabilities, losses, damages, debts, obligations, claims, costs or
expenses, interest, awards, judgments, orders, fines and penalties (including reasonable attorneys’
fees and expenses) suffered or incurred by them as a result of the Shareholder’s failure to fully
comply with its obligations to provide information under Section 6.8(c);




          (b) any Taxes imposed as a result of or penalties attributable to the Special Dividend or the
2006 Restructuring; and




          (c) any and all losses solely attributable to interest and penalties incurred as a result of
the Company’s preparation of Income Tax Returns for periods after September 30, 2005, through and
including the Closing Date (the “Applicable Tax Return Periods”) in accordance with the
customs and practices employed by the Company in filing Income Tax Returns for periods ending
September 30, 2005; provided, however, that Shareholder shall not be required to indemnify the
Purchaser Indemnified Parties pursuant to this Section 6.9(c) if the relevant custom or
practice is no longer employable due to a change in statute or regulation in effect for the
Applicable Tax Return Periods (as compared to that in effect for the period ending September 30,
2005) or to the extent that the facts in such Applicable Tax Return Periods are different from the
facts with respect to the period ending September 30, 2005, and such difference causes the relevant
custom or practice to no longer apply.




     Section 6.10 Refunds and Credits. Except to the extent such item results from the
carryback of a post-September 29, 2005 Tax attribute, any refunds, rebates, credits or overpayments
of Income Taxes of the Company and each of the Subsidiaries for any taxable period ending on or
before September 29, 2005 (“Seller Income Tax Refunds”) shall be for the account of
Shareholder, and Purchaser shall promptly pay to Shareholder any Seller Income Tax Refunds received
by Purchaser or its Affiliates after the Closing. Any refunds, rebates, credits or overpayments of
the Company and each of the Subsidiaries of Income Taxes for any taxable period beginning after the
Closing Date or attributable to the carryback of a post-September 30, 2005 Tax attribute
(“Purchaser Income Tax Refunds”) shall be for the account of Purchaser, and Shareholder
shall promptly pay to Purchaser any Purchaser Income Tax Refunds received by Shareholder after the
Closing. Any refunds rebates, credits or overpayments of Non-Income Taxes of the Company and each
of the Subsidiaries that are with respect to Non-Income Taxes paid by the Company on or before May
25, 2006, shall be for the account of Shareholder (“Seller Non-Income Tax Refunds”) and any
other refunds, rebates, credits or overpayments of Non-income Taxes of the Company and each of the
Subsidiaries shall be for the account of Purchaser (“Purchaser Non-Income Tax Refunds”).
Purchaser shall promptly pay to Shareholder any Seller Non-Income Tax Refunds received by Purchaser
or its Affiliates after the Closing and Shareholder shall promptly pay to Purchaser any Purchaser
Non-Income Tax Refunds received by Shareholder after the Closing.



     Section 6.11 Transfer Taxes. Purchaser, on the one hand, and Shareholder, on the other, shall each pay 50% of all
transfer, documentary, sales, use, stamp, registration and other such Taxes (including real estate
transfer Taxes), and all conveyance fees, recording charges and other fees and charges (including
any penalties and interest) incurred in connection with the



47









 




consummation of the purchase of the
Shares. Purchaser shall, at its own expense, prepare and cause to be filed all necessary Tax
Returns and other documentations with respect to all such Taxes, fees and charges and, if required
by applicable Law, the Parties shall, and shall cause their Affiliates to, join in the execution of
any such Tax Returns and other documentation.




     Section 6.12 Employee Matters.



          (a) Purchaser agrees that for a period of 6 months, each Continuing Employee shall be provided
such employment on terms and conditions substantially as favorable as provided by the Company
immediately prior to the Closing with respect to base salary and benefits set forth in the U.S.
Benefit Plans, Foreign Benefit Plans, the Annual Incentive Plan, the Project Incentive Compensation
Plan (Project Managers) and the Project Incentive Compensation Plan (Vice Presidents).




          (b) Shareholder shall assume and retain each U.S. Benefit Plan, and none of Holdings,
Purchaser, the Company, its Subsidiaries, or any of their respective Affiliates shall have any
obligation or liability at any time relating to or arising under or in connection with, any U.S.
Benefit Plan or any “employee benefit plan” (as defined in Section 3(3) of ERISA) or any other
benefit plan, program or arrangement of any kind at any time maintained, sponsored or contributed
or required to be contributed to by Shareholder or any of its Affiliates (including CTH LLC), the
Company, any of its Subsidiaries or any ERISA Affiliate, or with respect to which Shareholder or
any of its Affiliates (including CTH LLC), the Company, any of its Subsidiaries or any ERISA
Affiliate has any liability or potential liability, including for the avoidance of doubt (i) the
responsibility for satisfying the continuation coverage requirements of COBRA for all employees or
former employees or other service providers (and any dependents or beneficiaries thereof) of
Shareholder or any of its Affiliates (including CTH LLC), the Company, its Subsidiaries or any of
their affiliates, or any ERISA Affiliate who are receiving COBRA continuation coverage as of the
Closing Date or who are entitled to elect such coverage on account of a qualifying event occurring
on or before the Closing Date, and (ii) the sponsorship of and all liabilities and obligations of
any kind arising at any time under the 401(k) plan covering employees of the Company and its
Subsidiaries prior to the Closing.




          (c) All vacation, sickness, leave, holiday and personal days accrued by the Continuing
Employees prior to the Closing shall be honored by Purchaser and/or the Company.




          (d) Effective as of the Closing Date, the Company or Purchaser shall make available a
cafeteria plan described under Section 125 of the Code for the benefit of all Continuing Employees
(“Purchaser’s Cafeteria Plan”) who were eligible to participate in such a plan sponsored by
the Company and assumed by Shareholder as indicated above (“Shareholder’s Cafeteria Plan”).
Purchaser’s Cafeteria Plan shall include medical expense reimbursement accounts and dependent care
assistance accounts (as described under Sections 125 or 129 of the
Code) (the “Flex Accounts”). As soon as administratively feasible after the Closing
Date, Shareholder shall transfer to Purchaser’s Cafeteria Plans the account balance of any Flex
Accounts maintained by Continuing Employees in Shareholder’s Cafeteria Plan.




          (e) The provisions of this Section 6.12 are for the sole benefit of the Parties to
this Agreement and their permitted successors and assigns, and nothing herein, expressed or




48









 







implied, shall give or be construed to give any Person, other than the Parties hereto and such
permitted successors and assigns, any legal or equitable rights hereunder.




          (f) Nothing in this Section 6.12 is intended to alter the terms and conditions or
character of any existing employment relationship between the Company or its Subsidiaries and any
Continuing Employee and, in particular, nothing herein shall be construed to limit the ability of
the Company, its Subsidiaries, Holdings, Purchaser, or any of their Affiliates to terminate the
employment of any employee (including any Continuing Employee) at any time and for any or no
reason.




     Section 6.13 Actions with Respect to Financing.



          (a) From the date hereof until the Closing Date, the Company shall, and shall cause each of
its Subsidiaries and its and their respective employees and Representatives to use commercially
reasonable efforts to, assist Purchaser in obtaining the financing contemplated by the Debt
Financing Commitment Letter (and any comparable financing that Purchaser may elect to obtain in
substitution for all or part of the financing contemplated by the Debt Financing Commitment Letter)
and in connection therewith, the Company shall, and shall cause each of its Subsidiaries to, use
commercially reasonable efforts to: (i) promptly prepare and provide all financial and other
information as Purchaser or its lenders may reasonably request with respect to the Company, its
Subsidiaries and the Contemplated Transactions (including financial projections relating to the
foregoing); (ii) assist in the preparation of an offering memorandum or registration statement and
“road show” and other marketing materials for use in connection with the offering of any securities
constituting a portion of Purchaser’s financing, including providing Purchaser with any audited and
interim unaudited balance sheets and related statements of income of the Company and its
Subsidiaries; (iii) make available to prospective lenders such senior management and advisors of
the Company and its Subsidiaries as Purchaser’s lenders may reasonably request; (iv) make senior
management of the Company and its Subsidiaries reasonably available to participate in “road show”
meetings with prospective investors in connection with the offering of any securities constituting
a portion of the financing contemplated by the Debt Financing Commitment Letter; (v) assist
Purchaser and its lenders in the preparation and presentation of one or more confidential
information memoranda, “bank books,” information packages regarding the business, operations,
projections and prospects of the Company and other marketing materials to be used in connection
with the syndication of each of such facilities and in obtaining and maintaining credit ratings
from Standard & Poor’s Rating Group and Moody’s Investor Services, Inc.; and (vi) assist Purchaser
and its lenders in communicating with and obtaining from the landlord under each Real Property
Lease such information, agreements, instruments or certificates requested by Purchaser’s lenders in
connection with the Debt Financing, provided that the Company shall not be required to pay
any material consideration, monetary or otherwise, or agree to any material concessions, in order
to obtain any such information, agreements, instruments or certificates unless Purchaser shall
agree to bear the cost thereof.




          (b) In addition to the foregoing, the Company, Shareholder and CTH LLC shall use commercially
reasonable efforts to cause the Company’s independent certified public accountants to (i) deliver
to Purchaser and the underwriters or placement agents in any financing referred to above a letter
covering such matters as are reasonably requested by Purchaser or such




49









 







underwriters or placement
agents, as the case may be, and as are customarily addressed in accountants’ “comfort letters” and
(ii) provide their consent to the references to them as experts and the inclusion in any applicable
filings of their auditors reports, provided that any fees and expenses incurred in
retaining such accountants for these purposes shall be borne by Purchaser.




          (c) Purchaser will use commercially reasonable efforts to obtain the proceeds of the financing
contemplated by the Purchaser Debt Financing Commitment Letter on the terms and conditions
described in such letter. Purchaser shall not consent to any amendment or modification to the
conditions to funding set forth on Exhibit B to the Purchaser Debt Financing Commitment Letter in a
manner that would materially increase the likelihood that the conditions to funding would not be
satisfied. Purchaser shall provide a copy of any amendment to the Purchaser Debt Financing
Commitment Letter to the Company.




     Section 6.14 Public Announcements. Prior to the Closing, the Company, Shareholder,
CTH LLC, Purchaser and Holdings agree that they shall not, and each Party shall cause its
Affiliates and Representatives not to, make any statement to the press, press release or other
public announcement regarding this Agreement or the Contemplated Transactions unless the text and
time of the release of any such statement have been approved by the other Parties, except where (i)
such disclosure is required pursuant to applicable Law, including disclosures to the Securities and
Exchange Commission regarding this Agreement (in which case such Party will provide reasonable
opportunity to the other Party to review, any such public statements prior to disclosure) and (ii)
except that Purchaser shall be permitted to disclose the existence and contents of this Agreement
and such other information related to the Contemplated Transactions and the Company and its
Subsidiaries as Purchaser reasonably deems necessary to National CineMedia, LLC, a Delaware limited
liability company (“NCM”), and the members, Representatives and financing sources of NCM
and each of its members. The Parties shall issue a joint press release, mutually acceptable to the
Company, Shareholder and Purchaser, promptly upon execution of this Agreement. Thereafter, no
Party to this Agreement will issue any press release or make any other public disclosures
concerning the Contemplated Transactions or the contents of this Agreement without the prior
written consent of the other Parties. Notwithstanding the above, nothing in this Section
6.14 will preclude any Party from making any disclosures required by Law or necessary and
proper in conjunction with the filing of any Tax Return or other document required to be filed in
connection with making or obtaining (as the case may) any Governmental Authorizations required
hereunder; provided that the Party required to make the release or statement shall allow
the other Parties reasonable time to review and comment on such release or statement in advance of
such issuance.



     Section 6.15 Section 280G.



          (a) The Company shall submit for approval by Shareholder so as to render the parachute payment
provisions of Section 280G of the Code inapplicable to any and all accelerated vesting payments,
benefits, options and/or stock provided pursuant to agreements, Contracts or arrangements that
might otherwise result, separately or in the aggregate, in the payment of any amount and/or the
provision of any benefit that would not be deductible by reason of Section 280G of the Code, with
such shareholder vote to be obtained in a manner which satisfies all applicable requirements of
Section 280G(b)(5)(B) of the Code and the regulations promulgated thereunder.




50









 








          (b) Each Person who might receive any payments and/or benefits referred to in Section
6.15 hereof shall have executed and delivered to the Company a 280G Waiver substantially in the
form attached hereto as Exhibit H (the “280G Waiver”), by which such Person agrees
to waive any right or entitlement to the payments and/or benefits referred to in Section
6.15 hereof, unless the requisite stockholder approval of those payments and/or benefits are
obtained pursuant to Section 6.15 hereof.




     Section 6.16 Stub Period Financial Statements. The Company shall use commercially
reasonable efforts to close its books and perform such internal tasks as may be consistent with the
preparation of an audited consolidated balance sheet of the Company and its Subsidiaries as of July
27, 2006 and the related statements of income, shareholders’ equity and cash flows for the 10-month
period then ended, all prepared in accordance with GAAP applied in the same matter as in the
preparation of the Latest Audited Balance Sheet, but the delivery of such financial statements, and
the retention of an independent public accounting firm to audit such financial statements, shall
not be a condition to the Closing.



     Section 6.17 Severance Plan and Severance Payment.



          (a) Prior to the Closing, Shareholder shall cause the Company to approve and adopt the
Severance Plan in the form attached as Exhibit I hereto.




          (b) No later than three Business Days prior to the Closing, the Company shall deliver to
Purchaser an update to the Agreement Date Salary Schedule to reflect any changes in the base salary
for Eligible Employees since the date hereof (as so adjusted, the “Closing Date Salary
Schedule”); provided that, in no event shall the amount of base salary as reflected on
the Closing Date Salary Schedule exceed the amount of base salary as reflected on the Agreement
Date Salary Schedule by more than (i) 15% for any Eligible Employee with an annual base salary less
than $75,000 on the Agreement Date Salary Schedule, (ii) 9% with respect to any Eligible Employee
with an annual base salary greater than or equal to $75,000 on the Agreement Date Salary Schedule
or (iii) 4.5% in the aggregate for all Eligible Employees; and provided further that in no
event shall any such increase in the base salary for any employee go into effect before the first
pay period following September 30, 2006. Notwithstanding anything in this
Agreement to the Contrary, the Company may modify the terms of the Annual Incentive Plan or
any successor or similar Plan to comply with Code Section 409A including, but not limited to, the
payment terms of such plan.




          (c) At the Closing, Shareholder (and not CTH LLC, the Company or its Subsidiaries) shall
deposit in escrow an amount (the “Severance Escrow Fund”) in cash equal to the sum of (i)
the aggregate amount of two months’ base salary for all of the Eligible Employees as reflected on
the Closing Date Salary Schedule, plus (ii) all withholding Taxes with respect to the amount set
forth in clause (i), plus (iii) any social security, medicare, unemployment or other payroll taxes
payable by the Company or its Subsidiaries with respect to the amount set forth in clause (i), with
such institution acting as escrow agent as shall be acceptable to Shareholder and Purchaser and
which amount shall be held pursuant to the terms of this Agreement and an escrow agreement among
Shareholder, the Company, the escrow agent and Purchaser with respect to the Severance Escrow Fund.




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          (d) At any time after the Closing and prior to the Severance Escrow Expiration Date, if any
Eligible Employee receives any payment under the Severance Plan adopted pursuant to Section
6.17(a), the Company shall deliver to the escrow agent a certificate signed by an officer of
the Company or Purchaser stating that the Company has made a payment to an Eligible Employee
pursuant to the Severance Plan and the amount of such payment. Upon receipt of such certificate,
the escrow agent shall deliver to the Company out of the Severance Escrow Fund, as promptly as
practicable, an amount equal to the sum of (i) two months’ base salary for the Eligible Employee as
set forth on the Closing Date Salary Schedule, plus (ii) any withholding Taxes with respect to the
amount set forth in clause (i), plus (iii) any social security, medicare, unemployment or other
payroll taxes payable by the Company or its Subsidiaries with respect to the amount set forth in
clause (i).




          (e) Promptly after the Severance Escrow Expiration Date, the escrow agent shall deliver to
Shareholder the remaining portion of the Severance Escrow Fund after the payment of any amounts due
pursuant to Section 6.17(d).




          (f) At any time prior to the Closing, Shareholder (and not the Company or its Subsidiaries)
shall pay to each project manager any and all payments, whether or not such payment is then due and
payable, with respect to any project, whether open or closed, for which the project manager is
responsible pursuant to the Project Incentive Compensation Plan (Project Managers) and the Project
Incentive Compensation Plan (Vice Presidents) and any similar plans.




     Section 6.18 Annual Incentive Plan.



          (a) The Company shall make all payments required to be made to AIP Employees under the Annual
Incentive Plan at the Closing or as soon thereafter as the amount payable under such plan can be
determined in accordance with its terms. With respect to any payment made to any AIP Employee
under the Annual Incentive Plan pursuant to this Section 6.18(a), if such payment is made
(A) prior to the last day of the Company’s 2006 fiscal year, the payment shall be calculated using
the Pro-Rata Calculation Method, (B) after the last day of the Company’s 2006 fiscal year but prior
to the completion of the audit with respect to the 2006 fiscal year, the payment shall be
calculated using the Pre-Audit Calculation Method and (C) after
the completion of the audit with respect to the 2006 fiscal year, the payment shall be
calculated using the Audit Calculation Method.




          (b) The Company shall have the right to adopt an annual incentive plan with respect to its
2007 fiscal year (the “2007 AIP”); provided that the 2007 AIP shall provide for
compensation no greater in the aggregate than the Annual Incentive Plan, shall not extend beyond
six months following the Closing Date, and contain terms (including, without limitation, as to
eligibility, performance targets and incentive award levels) substantially similar to the terms of
the Annual Incentive Plan and shall be in accordance with the terms of this Agreement. If the
Company adopts a 2007 AIP, the Company shall make all payments required by the 2007 AIP. With
respect to any payment made to any AIP Employee under the 2007 AIP pursuant to this Section
6.18(b), such payment shall be calculated using the Pro-Rata Calculation Method.




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          (c) Upon the making of the payments contemplated by Section 6.18(a) and Section
6.18(b), the Annual Incentive Plan and the 2007 AIP shall terminate and be of no further force
and effect.




     Section 6.19 Payments with respect to Fandango Shares after the Closing. 




          (a) Payment of Proceeds with respect to Transfer of Fandango Shares. After the
Closing, in the event that the Company or the Purchaser receives cash proceeds upon a sale or
transfer of any of the Fandango Shares, the Company shall pay to Shareholder such cash proceeds
received by the Company, Purchaser or Holdings (net of any Taxes paid by the Company or its
Affiliates thereon); provided that the aggregate amount payable to Shareholder pursuant to
this Section 6.19(a) shall not exceed in the aggregate Two Million Eight Hundred Thousand
Dollars ($2,800,000).




          (b) Payment with respect to Publicly-Traded Fandango Shares. After the Closing, in
the event that the Fandango Shares are traded on a national securities exchange or The Nasdaq Stock
Market (“Nasdaq”) for 180 days consecutively at an average closing price per Fandango Share
that results in an aggregate value for the Fandango Shares of at least Five Million Six Hundred
Thousand Dollars ($5,600,000), then, promptly, and in no event later than ten Business Days after
such 180 day period, the Company (or its designee) shall pay to Shareholder an amount in cash equal
to Two Million Eight Hundred Thousand Dollars ($2,800,000).




     Section 6.20 Office Furnishings. Any ownership interest of the Company in the Furnishings
primarily used by Raymond W. Syufy, Joseph Syufy or any other Company employee, if any, who is
employed by Shareholder after the Closing, shall be transferred to Shareholder without any fee,
service charge or other payment (i) at the time of Closing with respect to the Furnishings
primarily used by Raymond W. Syufy and Joseph Syufy and (ii) at the commencement of employment with
Shareholder with respect to the Furnishings primarily used by any other Company employee.



     Section 6.21 Seller Transaction and Financing Expenses. Shareholder (and not the Company
or its Subsidiaries) shall pay in full all Seller Transaction Expenses immediately prior to the
Closing, and none of Purchaser, Holdings, the Company or its Subsidiaries shall have any obligation
to any payee of any Seller Transaction Expense (including indemnification obligations) after the
Closing. Shareholder (and not the Company or its Subsidiaries) shall pay in full all Seller
Financing Expenses as soon as such expenses become due and payable and in all cases prior to
Closing, and none of Purchaser, Holdings, the Company or its Subsidiaries shall have any obligation
to any payee of any Seller Financing Expense (including indemnification obligations) after the
Closing.



     Section 6.22 Aurora Property. The Company shall seek to obtain a consent from the
owner (the “Aurora Landlord”) of the Real Property located at 14300 East Alameda Ave. CO
80012 (the “Aurora Property”) to the consummation of the Contemplated Transactions in
accordance with the terms of the Aurora Lease and in a form reasonably satisfactory to Purchaser
and shall deliver such request for consent within seven (7) Business Days following the date of
this Agreement; provided that, if consent is not received prior to Closing and the Aurora



53









 




Landlord
has exercised its recapture right (or the time period for the Aurora Landlord to exercise the
recapture right under the Aurora Lease has not expired as of the Closing), then the Purchase Price
shall be reduced by $17.5 million. In the event the Purchase Price is reduced pursuant to this
Section 6.22 and following the Closing the Company receives the Recapture Price (as defined
in the Aurora Lease) from the Aurora Landlord in connection with a recapture of the Aurora Property
pursuant to the terms of the Aurora Lease, Purchaser shall cause the Company to pay the Recapture
Price to Shareholder. Purchaser further agrees to use commercially reasonable efforts, at
Shareholder’s expense, to collect the Recapture Price from the Aurora Landlord for a period of 30
days following the Closing, and to the extent that Purchaser is unable to collect the Recapture
Price during such 30-day period, Purchaser agrees to assign its rights to collect the Recapture
Price to Shareholder. In the event the Purchase Price is reduced pursuant to this Section
6.22 but the time period for the Aurora Landlord to exercise the recapture right had not
expired as of the Closing, and following the Closing the Aurora Landlord either consents to the
Contemplated Transactions or the time period for exercising the recapture right expires, Purchaser
shall pay (or cause to be paid) to the Shareholder the amount by which the Purchase Price was
reduced pursuant to this Section 6.22. Upon a recapture of the Aurora Property by the
Aurora Landlord, Shareholder shall have the right to exercise the Company’s right to remove
equipment from the Aurora Property pursuant to the terms of the Aurora Lease and dispose of any
removed equipment by sale or otherwise, at the sole cost and expense of Shareholder. Shareholder
shall retain all proceeds received from the disposal of any removed equipment.




     Section 6.23 Northglenn Property. Shareholder shall cause the Company to either (a)
terminate the Northglenn Lease or (b) distribute 100% of the limited liability company interests of
Century Theatres NG, LLC, a California limited liability company, to Shareholder (the
“Northglenn Distribution”) prior to Closing. In the event the Shareholder effects the
Northglenn Distribution, Shareholder and Purchaser shall negotiate in good faith for a period of 90
days to enter into a management agreement whereby Purchaser or one of its Affiliates will manage
the Northglenn theater on behalf of Shareholder. Following the conclusion of the 90-day period
Shareholder may negotiate and enter into a management agreement with any third party without any
further obligation to Purchaser with respect to such agreement. Nothing in this Section
6.23 shall in any way limit or modify the restrictions set forth in the Noncompetition and
Nondisclosure Agreement.



     Section 6.24 Credit Agreement Consent. The Company shall use its best efforts to
promptly obtain the consent of the Required Lenders (as defined in the Credit Agreement) with
respect to the execution and the consummation of the transactions contemplated by this Agreement.
In the event the Company is unable to secure the consent of the Required Lenders, the Company shall
obtain the proceeds of the financing contemplated by the Company Debt Financing Commitment Letter
and refinance the Credit Agreement. Neither the Shareholder nor the Company shall consent to any
amendment or modification to the conditions to funding set forth in the Company Debt Financing
Commitment Letter in a manner that would materially increase the likelihood that the conditions to
funding would not be satisfied.



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ARTICLE VII

CONDITIONS TO CLOSING




     Section 7.1 Conditions to Obligations of Each Party. The respective obligations of
each Party to effect the sale and purchase of the Shares, as applicable, and consummate the other
Contemplated Transactions shall be subject to the satisfaction as of the Closing Date of the
following conditions:



          (a) HSR Act. The waiting period (and any extension thereof) under the HSR Act shall
have expired or been terminated and all filings required to be made prior to the Closing Date with,
and all consents, approvals, permits and authorizations required to be obtained prior to the
Closing Date from Governmental Authorities in connection with the execution and delivery of this
Agreement and the consummation of the Contemplated Transactions will have been made or obtained (as
the case may be).




          (b) No Proceedings or Orders. No proceeding shall have been commenced by any
Governmental Authority or third party against any Party seeking to restrain the purchase and sale
of the Shares and there shall not be in effect any Law or Governmental Order directing that the
purchase and sale of the Shares not be consummated or which has the effect of enjoining or
otherwise prohibiting consummation of the purchase and sale of the Shares.




          (c) Holdings Stockholders Agreement. The Holdings Stockholders Agreement attached
hereto as Exhibit C shall be in full force and effect as of the Closing and shall not have
been amended.




          (d) Holdings Registration Agreement. The Holdings Registration Agreement attached
hereto as Exhibit D shall be in full force and effect as of the Closing and shall not have
been amended.




     Section 7.2 Additional Conditions to Obligations of Purchaser and Holdings. The
obligations of Purchaser to purchase the Shares and of Holdings to issue the Holdings Stock and the
obligations of each of them to consummate the other Contemplated
Transactions shall be subject to the fulfillment as of the Closing of each of the following
conditions:



          (a) Representations and Warranties. The representations and warranties of the
Company, Shareholder and CTH LLC contained in the Transaction Documents which are not qualified as
to materiality or Company Material Adverse Effect shall be true and correct in all material
respects, and the representations and warranties which are qualified as to materiality or a Company
Material Adverse Effect shall be true and correct in all respects, in each case at and as of the
Closing Date, as though then made, and as though the Closing Date were substituted for the date of
this Agreement throughout such representations and warranties (except for those representations and
warranties which address matters only as of a particular date (which shall remain true and correct
as of such date)), and Purchaser shall have received a certificate to such effect signed by an
executive officer of the Company, CTH LLC and Shareholder.




          (b) Agreements and Covenants. The Company, CTH LLC and Shareholder each shall have
performed or complied in all material respects with all agreements and covenants required by this
Agreement to be performed or complied with by it (except for any agreements or




55









 







covenants that are
qualified by a standard of materiality, which agreements or covenants the Company, CTH LLC and
Shareholder shall have performed or complied with in all respects) on or prior to the Closing Date,
and Purchaser shall have received a certificate to such effect signed by an executive officer of
the Company, CTH LLC and Shareholder.




          (c) Delivery of Shares. Shareholder shall have delivered the Shares (including the
Rollover Shares) to Purchaser and Holdings, as applicable, duly endorsed for transfer and
accompanied by stock powers duly executed in blank.




          (d) Contribution and Exchange Agreement; Holdings Stockholders Agreement; Holdings
Registration Agreement. The Contribution and Exchange Agreement, the Holdings Stockholders
Agreement and the Holdings Registration Agreement shall be in full force and effect as of the
Closing.




          (e) No Material Adverse Change. No event that has had, or would reasonably be
expected to have, a Company Material Adverse Effect shall have occurred since the date of this
Agreement.




          (f) Opinion of Company Counsel. The Company shall have furnished Purchaser with an
opinion of Morrison & Foerster LLP, counsel to the Company, (which opinion shall state that the
agent and the lenders with respect to the Debt Financing contemplated by the Debt Financing
Commitment Letter may rely on such opinion for purposes of arranging or providing such Debt
Financing), opining on matters set forth on Exhibit L attached hereto, in form and
substance reasonably acceptable to Purchaser’s counsel.




          (g) Terminated Agreements. Each of the Agreements set forth on Schedule
7.2(g) attached hereto shall have been terminated, and evidence of such shall have been
delivered to Purchaser, in form and substance reasonably acceptable to Purchaser.




          (h) Financing. Purchaser shall have received the Debt Financing proceeds in the
amounts and on the terms and conditions set forth in the term sheets included with the Purchaser
Debt Financing Commitment Letter.




          (i) Payoff Letters. The Company shall have provided to Purchaser payoff letters with
respect to all Indebtedness of the Company and its Subsidiaries to be paid off at the Closing by
Purchaser, which Indebtedness is set forth on Schedule 3.24 of the Company Disclosure
Schedule, and shall have obtained releases of all Liens related thereto, including appropriate UCC
termination statements against CTH LLC’s the Company’s or any of its Subsidiaries’ property, in
form and substance reasonably satisfactory to Purchaser.




          (j) FIRPTA Certificate. Shareholder shall have delivered to Purchaser an affidavit,
dated as of the Closing Date, in form and substance required under the Treasury Regulations issued
pursuant to Section 1445 of the Code, certifying that Shareholder is not a foreign Person so that
Purchaser is exempt from withholding any portion of the Purchase Price payable to Shareholder.




          (k) Section 280G. Any agreements, contracts or arrangements that may result,
separately or in the aggregate, in the payment of any amount or the provision of any




56









 







benefit that
would not be deductible by reason of Section 280G of the Code shall have been submitted for
approval by such number of stockholders of Company as is required by the terms of Section 280G in
order for such payments and benefits not to be deemed parachute payments under Section 280G of the
Code, with such approval to be obtained in a manner which satisfies all applicable requirements of
Section 280G(b)(5)(B) of the Code and the Treasury Regulations thereunder, including Q&A 7 of
Section 1.280G-1 of such Treasury Regulations, and, in the absence of such shareholder approval,
none of those payments or benefits shall be paid or provided, pursuant to the 280G Waivers.




          (l) Seller Expenses. Purchaser shall have received from each of the payees of the
Seller Transaction Expenses identified on Schedule 7.2(l) a written acknowledgement, in form and
substance reasonably satisfactory to Purchaser, that each such payee has been paid in full for all
services rendered for, or on behalf of, Shareholder, CTH LLC, the Company and its Subsidiaries as
of the Closing and that none of Holdings, Purchaser or the Company or its Subsidiaries shall have
any obligations to such payee (including indemnification obligations) after the Closing.




          (m) Officer’s Certificate. The Company shall have delivered to Purchaser a
certificate of an authorized officer of the Company in the form set forth on Exhibit M,
dated the Closing Date, stating that each of the conditions specified above in Sections
7.1, Sections 7.2(a)–(e), and Section 7.2(k) is satisfied in all respects.




          (n) Estoppel. Shareholder shall have executed and delivered an estoppel certificate
in the form attached hereto as Exhibit N for each of the Real Property Leases for which
Shareholder, or any of its Affiliates, is a landlord.




          (o) Syufy Real Property Lease Amendments. The Syufy Lease Amendments attached hereto
as Exhibit J shall be in full force and effect as of the Closing and shall not have been
amended.




          (p) Non-Competition and Non-Disclosure Agreement. The Non-Competition and
Non-Disclosure Agreement shall be in full force and effect as of the Closing and shall not have
been amended.




          (q) Severance Plan. The Company shall have approved and adopted a Severance Plan
pursuant to Section 6.17 in the form attached as Exhibit I, and such Severance Plan
shall be in full force and effect as of the Closing and shall not have been amended.




          (r) Bradshaw Property. The lease between Bradshaw Landing L.L.C., as landlord, and
Century Theatres, Inc., as tenant, for lease of the certain premises located at The Landing,
Sacramento, California, consisting of 37.46 acres located at the northwest quadrant of Highway 50
and Bradshaw, dated as of the date hereof, attached hereto as Exhibit O, shall be in full
force and effect as of the Closing and shall not have been amended.




          (s) Profits and Losses Participation Agreement. The Winchester Agreement attached
hereto as Exhibit K shall be in full force and effect as of the Closing and shall not have
been amended.




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          (t) CTH LLC Transactions. Prior to the Closing, (i) CTH LLC shall distribute all of
the Shares to Shareholder, (ii) after such distribution, CTH LLC shall dissolve and liquidate and
cease to exist, such that Shareholder shall, on the close of business on the day immediately prior
to the Closing Date, own all of the Shares, and (iii) evidence of such transactions described in
this Section shall be provided to Purchaser and Holdings.




          (u) Lease Consent Requests. The Company shall have submitted written requests to the
applicable landlord requesting such landlord’s consent to the consummation of the Contemplated
Transactions under the following Real Property Leases: (i) Northgate Lease; (ii) Aurora Lease;
(iii) Sams Town Lease; and (iv) Southcoast Lease, and in each case evidence thereof reasonably
satisfactory to Purchaser shall have been delivered by the Company to Purchaser.




          (v) Deliveries. The deliveries required pursuant to Section 2.3 shall have
been delivered.




     Section 7.3 Additional Conditions to Obligations of the Company and Shareholder. The
obligations of Shareholder to sell the Shares and the obligations of each of the Company, CTH LLC
and Shareholder to consummate the other Contemplated Transactions shall be subject to the
fulfillment as of the Closing of each of the following conditions:



          (a) Representations and Warranties. The representations and warranties of Purchaser
and Holdings contained in the Transaction Documents which are not qualified by materiality shall be
true and correct in all material respects and those representations and warranties which are
qualified as to materiality shall be true and correct in all respects, in each
case at and as of the Closing Date, as though then made and as though the Closing Date were
substituted for the date of this Agreement throughout such representations and warranties (except
for those representations and warranties which address matters only as of a particular date (which
shall remain true and correct as of such date)), and the Company and Shareholder shall have
received a certificate to such effect signed by an executive officer of each of Purchaser and
Holdings.




          (b) Agreements and Covenants. Each of Purchaser and Holdings shall have performed or
complied in all material respects with all agreements and covenants required by this Agreement to
be performed or complied with by it (except for any agreements or covenants that are qualified by a
standard of materiality, which agreements or covenants Purchaser or Holdings shall have performed
or complied with in all respects) on or prior to the Closing Date, and the Company and Shareholder
shall have received a certificate to such effect signed by an executive officer of Purchaser and
Holdings.




          (c) Contribution and Exchange Agreement; Holdings Stockholders Agreement; Holdings
Registration Agreement. The Contribution and Exchange Agreement, the Holdings Stockholders
Agreement and the Holdings Registration Agreement shall be in full force and effect as of the
Closing.




          (d) Deliveries. The deliveries required pursuant to Section 2.4 shall have
been delivered.




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ARTICLE VIII

TERMINATION




Section 8.1 Termination.



          (a) This Agreement may be terminated at any time prior to the Closing:





               (i) By the mutual written consent of Shareholder, the Company, Purchaser and Holdings;




               (ii) Upon ten (10) days’ prior written notice, by either Shareholder and the Company,
on the one hand, or Purchaser and Holdings, on the other hand, if the Closing shall not have
occurred by the date which is 155 days following the date hereof; provided, that the
right to terminate this Agreement under this Section 8.1(a)(ii) shall not be
available to any Party that is in material breach of or default under this Agreement or
whose failure to fulfill any obligation under this Agreement shall have been the principal
cause of, or shall have resulted in, the failure of the Closing to occur on or prior to such
date;




               (iii) Upon five (5) days’ prior written notice, by either Shareholder and the Company,
on the one hand, or Purchaser and Holdings, on the other hand, in the event that any
Governmental Authority shall have issued an order, decree or ruling restraining,
enjoining or otherwise prohibiting the purchase and sale of the Shares and such order,
decree or ruling shall have become final and non-appealable;




               (iv) Upon five (5) days’ prior written notice, by Purchaser or Holdings, if Purchaser
delivers to the Company a written notice of objection to a supplement to the Company
Disclosure Schedule or Shareholder Disclosure Schedule pursuant to Section 6.4;




               (v) by the Company or Shareholder if there has been a material breach by Holdings or
Purchaser of the representations, warranties or covenants of Purchaser or Holdings set forth
in this Agreement, or by Purchaser or Holdings if there has been a material breach by the
Company, CTH LLC or Shareholder, as applicable, of the representations, warranties or
covenants of the Company, CTH LLC or Shareholder set forth in this Agreement, and in the
case of a breach of covenant if such breach shall not have been cured within 10 days after
notice thereof has been delivered to the breaching Party (or in any event prior to the date
of Closing);




               (vi) by Purchaser, if Purchaser shall have elected to terminate this Agreement pursuant
to the last sentence of Section 6.3(d); and




               (vii) by Purchaser, at any time, if (A) on or before the 45th day following
the date hereof, (1) the Existing Administrative Agent has not obtained written consent of
the Required Lenders to the execution of this Agreement and the consummation of the
transactions contemplated hereby and waiving any Default or Event of Default arising
therefrom under the Credit Agreement and the other Loan Documents and (2) the Backstop
Senior Credit Facilities have not been fully funded, or (B) the



59









 






Required Lenders or the
Existing Administrative Agent shall have taken any action to accelerate the maturity of the
advances or terminate or reduce the commitments under the Credit Facility, impose Default
Interest under the Credit Facility or otherwise exercise any rights or remedies under the
Credit Agreement or the other Loan Documents, or any such event shall have occurred
automatically under the Credit Agreement or any other Loan Document, and the Backstop Senior
Credit Facilities have not been fully funded within one (1) Business Day thereafter.




          (b) In the event of any termination pursuant to this Section 8.1:




               (i) Purchaser, on the one hand, and Shareholder, on the other hand, shall return, and
each shall cause its respective Affiliates and Representatives to return, to the Company or
Purchaser, as applicable, or destroy all documents and other material received from the
Company, its Subsidiaries, CTH LLC, Shareholder, Purchaser or Holdings, as applicable, or
any of their respective Representatives, relating to the Contemplated Transactions, whether
so obtained before or after the execution hereof; and




               (ii) All confidential information received by the Company, CTH LLC, Shareholder and
their respective Affiliates and Representatives or by Purchaser or Holdings, and their
respective Affiliates and Representatives, as applicable, shall be
treated in accordance with the Confidentiality Agreement, which shall remain in full
force and effect notwithstanding the termination of this Agreement.



     Section 8.2 Effect of Termination. Each Party’s right of termination under
Section 8.1 is in addition to any other rights it may have under this Agreement or
otherwise, and the exercise of a right of termination will not be an election of remedies. In the
event of termination of this Agreement as provided in Section 8.1, this Agreement shall
forthwith become void and have no effect and there shall be no liability on the part of any Party
except that (a) Section 8.1, this Section 8.2, and Article X shall survive
any such termination and (b) if this Agreement is terminated by a Party because of the breach of
this Agreement by the other Party or because one or more of the conditions to the terminating
Party’s obligations under this Agreement is not satisfied as a result of the other Party’s failure
to comply with its obligations under this Agreement, the terminating Party’s right to pursue all
legal remedies will survive such termination unimpaired.



ARTICLE IX

INDEMNIFICATION




     Section 9.1 Survival of Representations and Warranties. The representations and
warranties contained in the Transaction Documents shall survive the Closing as follows:



          (a) the representations and warranties in the first sentence of Section 3.1
(Organization), and in Section 3.2 (Authorization), Section 3.5
(Capitalization), Section 3.6 (Subsidiaries), Section 3.17(f) (Change of Control
Payments), Section 3.21 (Affiliate Transactions), Section 3.23 (Brokers),
Section 3.24 (Indebtedness), Section 4.1 (Title), Section 4.2
(Organization), Section 4.3 (Authorization), Section 4.5 (Brokers), Section
5.1 (Organization), and Section 5.2 (Authorization), and in the certificate required to
be delivered by




60









 







the Company and Shareholder pursuant to Section 7.2(a) with respect to the
first sentence in Section 3.1, and Section 3.2, Section 3.5, Section
3.6, Section 3.17(f), Section 3.21, Section 3.23, Section 3.24,
Section 4.1, Section 4.2, Section 4.3, and Section 4.5 and in the
certificates required to be delivered by
Purchaser and Holdings pursuant to Section 7.3(a)
with respect to Section 5.1 and Section 5.2, shall survive indefinitely;




          (b) the representations and warranties set forth in Section 3.19 (Taxes), and in the
certificate required to be delivered by the Company pursuant to Section 7.2(a) with respect
to Section 3.19, shall not terminate until 60 days after the expiration of the applicable
statute of limitations with respect to the liabilities in question (after giving effect to any
extensions or waivers thereof); and




          (c) all other representations and warranties contained in the Transaction Documents, any
Schedules or Exhibits thereto or in any certificate delivered by Purchaser or Holdings to the
Company, on the one hand, or by the Company, CTH LLC or Shareholder to Purchaser, on the other
hand, in connection with the Transaction Documents (including the certificate required to be
delivered by the Company and Shareholder pursuant to Section 7.2(a)
and the certificates required to be delivered by Purchaser and Holdings pursuant to
Section 7.3(a)), shall terminate on the first anniversary of the Closing Date.



Except as provided in the following sentence, none of Purchaser, Holdings or Shareholder shall have
any liability whatsoever with respect to any such representations and warranties after their
respective termination date as set forth in this Section 9.1. Notwithstanding the
foregoing, any representation or warranty in respect of which indemnity may be sought under
Section 9.2 below, and the indemnity with respect thereto, shall survive the time at which
it would otherwise terminate pursuant to this Section 9.1 if written notice of the
inaccuracy or breach or potential inaccuracy or breach thereof giving rise to such right or
potential right of indemnity shall have been given to the Party against whom such indemnity may be
sought prior to such time (regardless of when the Losses in respect thereof may actually be
incurred or finally determined) and shall in no event be affected by any investigation, inquiry or
examination made for or on behalf of Purchaser or Holdings or the knowledge of any of Purchaser’s
or Holdings’ respective officers, directors, shareholders, employees or agents or the acceptance by
Purchaser or Holdings of any certificate or opinion hereunder.




     Section 9.2 Indemnification.



          (a) Subject to Section 9.5, after the Closing, Purchaser, Holdings, their respective
Affiliates, the Company and its Subsidiaries and each of their respective officers, directors,
employees, agents, representatives, Affiliates, successors and permitted assigns shall be
indemnified and held harmless by Shareholder for any and all liabilities, losses, damages, debts,
obligations, claims, costs or expenses, interest, awards, judgments, orders, fines and penalties
(including reasonable attorneys’ fees and expenses) actually suffered or incurred by them
(hereinafter a “Loss”), to the extent such Losses arise out of or result from:





               (i) the breach of any representation or warranty made by the Company, CTH LLC or
Shareholder contained in this Agreement, any Schedules or



61









 






Exhibits hereto or in any
certificate delivered by the Company, CTH LLC or Shareholder to Purchaser or Holdings
hereunder;




               (ii) the breach of any covenant or agreement by the Company, CTH LLC or Shareholder
contained in this Agreement;




               (iii) any 401(k) plan maintained or contributed to by Shareholder, CTH LLC, the
Company, any of its Subsidiaries or any of their ERISA Affiliates prior to the Closing Date
or with respect to which Shareholder, CTH LLC, the Company, any of its Subsidiaries or any
of their ERISA Affiliates have any liability;




               (iv) any U.S. Benefit Plans and any employee benefit plan (as defined in Section 3(3)
of ERISA) and any other benefit plan, program or arrangement of any kind maintained,
sponsored or contributed to by the Company, its Subsidiaries and any of their ERISA
Affiliates prior to the Closing Date or with respect to which the Company, its Subsidiaries
or any of their ERISA Affiliates have any actual or potential liability;




               (v) the CTH LLC Transactions;




               (vi) the Northglenn Distribution; and




               (vii) any event of default under the Credit Agreement, the solicitation of any consent
under the Credit Agreement and/or the refinancing of the Credit Agreement, in each case on
or prior to the Closing, and any Seller Financing Expense not paid prior to Closing.



          (b) Subject to Section 9.5, after the Closing, Shareholder and each of its respective
officers, directors, employees, agents, representatives, Affiliates, successors and permitted
assigns shall be indemnified and held harmless by Purchaser and Holdings for any and all Losses
arising out of or resulting from:





               (i) the breach of any representation or warranty made by Purchaser or Holdings
contained in this Agreement (including the schedules and exhibits thereto and any
certificates required to be delivered hereunder); or




               (ii) the breach of any covenant or agreement by Purchaser or Holdings contained in this
Agreement.



          (c) Any Party seeking indemnification under this Section 9.2 (an “Indemnified
Party”) shall promptly give the Party from whom indemnification is being sought (an
“Indemnifying Party”) notice of any matter which such Indemnified Party has determined has
given or could give rise to a right of indemnification under this Agreement stating the amount of
the Loss, if known, and method of computation thereof, and containing a reference to the provisions
of this Agreement in respect of which such right of indemnification is claimed or arises.




          (d) The obligations and liabilities of an Indemnifying Party under this Section 9.2
with respect to Losses arising from claims of any third party which are subject to the




62









 







indemnification provided for in this Section 9.2 (“Third Party Claims”) shall be
governed by and contingent upon the following additional terms and conditions: if an Indemnified
Party shall receive notice of any Third Party Claim, the Indemnified Party shall give the
Indemnifying Party notice of such Third Party Claim within 10 calendar days of the receipt by the
Indemnified Party of such notice; provided, however, that the failure to provide
such notice shall not release the Indemnifying Party from any of its obligations under this
Section 9.2 except to the extent the Indemnifying Party is materially prejudiced by such
failure. The Indemnifying Party shall be entitled, but not obligated, to assume and control the
defense of such Third Party Claim at its expense if it gives notice of its intention to do so to
the Indemnified Party within 20 calendar days of the receipt of such notice from the Indemnified
Party (it being understood that the fees and expenses incurred by the Indemnified Party during such
20-day period shall be borne by the Indemnifying Party); provided, however, that if
(i) there exists or is reasonably likely to exist a conflict of interest that would make it
inappropriate in the reasonable judgment of the Indemnified Party for the same counsel to represent
both the Indemnified Party and the Indemnifying Party, (ii) the Third Party Claim relates to or
arises in connection with any criminal proceeding, action, indictment, allegation or investigation,
(iii) the Third Party Claim seeks an
injunction or equitable relief against the Indemnified Party as its principal remedy; or (iv)
upon petition by the Indemnified Party, the appropriate court rules that the Indemnifying Party
failed or is failing to vigorously prosecute or defend such Third Party Claim, then the
Indemnifying Party shall not be entitled to assume the defense of such claim and the Indemnified
Party shall be entitled to retain its own counsel, reasonably acceptable to Indemnifying Party, at
the expense of the Indemnifying Party; provided further that, prior to the Indemnifying
Party having the right to assume control of such defense, the Indemnifying Party shall first verify
to the Indemnified Party in writing that such Indemnifying Party shall be fully responsible (with
no reservation of any rights) for all liabilities and obligations relating to such claim for
indemnification and that it shall provide full indemnification (without regard to any limitations
on indemnification set forth herein) to the Indemnified Party with respect to such Third Party
Claim. In the event the Indemnifying Party exercises the right to undertake any such defense
against any such Third Party Claim as provided above, the Indemnified Party shall cooperate with
the Indemnifying Party in such defense and make available to the Indemnifying Party all witnesses,
pertinent records, materials and information in the Indemnified Party’s possession or under the
Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party.
Similarly, in the event the Indemnified Party is, directly or indirectly, conducting the defense
against any such Third Party Claim, the Indemnifying Party shall cooperate with the Indemnified
Party in such defense and make available to the Indemnified Party all such witnesses, pertinent
records, materials and information in the Indemnifying Party’s possession or under the Indemnifying
Party’s control relating thereto as is reasonably required by the Indemnified Party. If the
Indemnifying Party shall control the defense of any such Third Party Claim, the Indemnifying Party
shall obtain the prior written consent of the Indemnified Party (which shall not be unreasonably
withheld) before entering into any settlement of or ceasing to defend such claim if, pursuant to or
as a result of such settlement or cessation, injunctive or other equitable relief
 shall be imposed
against the Indemnified Party or if such settlement does not expressly and unconditionally release
the Indemnified Party from all liabilities and obligations with respect to such claim, without
prejudice. No Third Party Claim which is being defended in good faith by the Indemnifying Party in
accordance with the terms of this Agreement shall be settled by the




63









 







Indemnified Party without the
prior written consent of the Indemnifying Party, which consent shall not be unreasonably withheld,
delayed or conditioned.




     Section 9.3 Defense of Tax Claims.



          (a) Notwithstanding the foregoing terms of Section 9.2 to the contrary, in the event
that any Governmental Authority informs Shareholder, on the one hand, or Purchaser, Holdings, the
Company or any of the Subsidiaries, on the other hand, of any notice of a proposed audit or other
dispute concerning an amount of Taxes with respect to which the other Party may incur liability
hereunder, the Party so informed shall promptly notify the other Party of such matter. Such notice
shall contain factual information (to the extent known) describing any asserted Tax liability in
reasonable detail and shall be accompanied by copies of any notice or other documents received from
any Governmental Authority with respect to such matter. If an Indemnified Party has actual
knowledge of an asserted Tax liability with respect to a matter for which it may be indemnified
hereunder and such Party fails to provide the Indemnifying Party prompt notice of such asserted Tax
liability, then (i) if the Indemnifying Party is entirely
foreclosed from contesting the asserted Tax liability solely as a result of the failure to
give prompt notice, the Indemnifying Party shall have no obligation to indemnify the Indemnified
Party for Taxes or Losses arising out of such asserted Tax liability, and (ii) if the Indemnifying
Party is not entirely foreclosed from contesting the asserted Tax liability, but such failure to
provide prompt notice results in any incremental Losses or any incremental monetary detriment to
the Indemnifying Party, then any amount which the Indemnifying Party is otherwise obligated to pay
the Indemnified Party pursuant to this Agreement shall be reduced by the amount of such incremental
detriment.




          (b) Shareholder shall control any audits, disputes, administrative, judicial or other
proceedings related to Taxes (“Tax Claims”) (i) which relate to Income Taxes for periods
ending on or prior to September 30, 2005, (ii) which relate to Non-Income Taxes for periods ending
on or prior to May 25, 2006 or (iii) with respect to which Shareholder is required to indemnify
Purchaser hereunder, and provided that, prior to accepting control of such Tax Claim, the
Shareholder agrees in writing that they are required to indemnify Purchaser with respect to such
Tax Claims. Purchaser or Holdings shall control any other Tax Claims. Subject to the preceding
sentence, in the event that an adverse determination may result in each Party having a
responsibility for any amount of Tax under this Article IX, each Party shall be entitled to
fully participate in that portion of the proceeding relating to the Taxes for which it may incur
liability hereunder. Purchaser or Holdings shall be entitled to participate in all Tax Claims at
its expense and bear any incremental costs incurred as a result of its participation. For purposes
of this Section 9.3(b), the term “participate” shall include (i) participation in
conferences, meetings or Proceedings with any Governmental Authority, the subject matter of which
includes an item for which such Party may have liability hereunder, (ii) participation in
appearances before any court or tribunal, the subject matter of which includes an item for which a
Party may have liability hereunder, and (iii) with respect to matters described in the preceding
clauses (i) and (ii), participation in the submission and determination of the content of the
documentation, protests, memoranda of fact and law, and briefs, and the conduct of oral arguments
and presentations.




          (c) Shareholder and Purchaser or Holdings shall not agree to settle any Tax liability or
compromise any claim with respect to Taxes which settlement or compromise would




64









 







reasonably be
expected to materially adversely affect the liability for Taxes hereunder (or right to Tax benefit)
of the other Party, without such other Party’s consent, which consent shall not be unreasonably
withheld or delayed.




     Section 9.4 Tax Treatment. Any payments under this Article IX shall be
treated by the Parties hereto for federal, state and local income Tax purposes (whether foreign or
domestic) as a non-taxable reimbursement or purchase price adjustment, except to the extent that a
contrary treatment is required by applicable Law.



     Section 9.5 Limits on Indemnification. (a) No amount shall be payable by Shareholder
pursuant to Section 9.2(a)(i) (other than with respect to the representations and
warranties contained in the first sentence of Section 3.1 (Organization), Section
3.2 (Authorization), Section 3.5 (Capitalization), Section 3.6
(Subsidiaries), Section 3.13(c) (Real Property), Section 3.17(f) (Change of
Control Payments), Section 3.19 (Taxes), Section 3.21 (Affiliate Transactions),
Section 3.23 (Brokers), Section 3.24 (Indebtedness), Section 4.1 (Title),
Section 4.2 (Organization), Section 4.3 (Authorization), and Section 4.5
(Brokers), and in the certificate required to be delivered by the Company and Shareholder pursuant
to Section 7.2(a) with respect to the first sentence in Section 3.1, and
Section 3.2, Section 3.5, Section 3.6, Section 3.13(c), Section
3.17(f), Section 3.19, Section 3.21, Section 3.23 (Brokers),
Section 3.24, Section 4.1, Section 4.2, Section 4.3, and
Section 4.5 (collectively, the “Shareholder Fully Indemnified Representations”))
unless (i) the amount of Loss related to any individual item exceeds $50,000 (provided that
such items shall be aggregated for the purposes of determining whether the Shareholder Deductible
has been reached); and (ii) the aggregate amount of Losses indemnifiable by Shareholder under
Section 9.2(a)(i) exceeds an amount (the “Shareholder Deductible”) equal to $5.25
million (and then only to the extent of such excess).



          (b) No amount shall be payable by Purchaser or Holdings pursuant to Section 9.2(a)(i)
(other than with respect to the representations and warranties contained in Section 3.1
(Organization), Section 3.2 (Authorization) and Section 5.12 (Brokers), and in the
certificate required to be delivered by Purchaser and Holdings pursuant to Section 7.2(a)
with respect to Section 5.1, Section 5.2 and Section 5.12 (collectively,
the “Purchaser Fully Indemnified Representations”)) unless (i) the amount of Loss related
to any individual item exceeds $50,000 (provided that such items shall be aggregated for
the purposes of determining whether the Purchaser Deductible has been reached); and (ii) the
aggregate amount of Losses indemnifiable by Purchaser and Holdings under Section 9.2(a)(i)
exceeds an amount (the “Purchaser Deductible”) equal to $750,000 (and then only to the
extent of such excess).




          (c) Notwithstanding anything to the contrary contained in this Agreement, the maximum amount
of aggregate indemnifiable Losses which may be recovered (i) from Shareholder under Section
9.2(a)(i) (other than with respect to the Shareholder Fully Indemnified Representations) shall
be an amount equal to $52.5 million and (ii) from Purchaser or Holdings under Section
9.2(b)(i) (other than with respect to the Purchaser Fully Indemnified Representations) shall be
an amount equal to $7.5 million.




          (d) Notwithstanding anything to the contrary contained herein, for purposes of determining
whether there has been a breach of a representation or warranty and the amount of any Losses that
are the subject matter of a claim for indemnification hereunder, the Deductible




65









 







amount shall be the
materiality standard for all purposes hereunder and, therefore, each representation, warranty and
other provision contained in this Agreement and each certificate delivered pursuant hereto (other
than in the case of the representation and warranty contained in Section 3.11(a)(ii) and in
the certificate required to be delivered by the Company and Shareholder pursuant to Section
7.2(a) with respect to Section 3.11(a)(ii)) shall be read without regard and without
giving effect to any materiality or Material Adverse Effect standard or qualification contained in
such representation or warranty (as if such standard or qualification were deleted from such
representation and warranty).




          (e) Notwithstanding anything to the contrary contained in this Agreement, no Party shall be
liable to the other Party for any punitive or exemplary damages arising out of this Agreement;
provided, however, that the foregoing shall not be construed to preclude recovery
by the Indemnified Party in respect of Losses directly incurred from Third Party Claims or Tax
Claims.




          (f) Notwithstanding anything to the contrary contained in this Agreement, no Indemnified Party
shall be entitled to recover under any claim of indemnification pursuant to this Agreement to the
extent such Indemnified Party has previously been indemnified for such claim under the Stock
Contribution and Exchange Agreement.




          (g) The amount of the Indemnifying Party’s liability under this Agreement shall be net of any
applicable insurance proceeds actually received by the Indemnified Party under the Company’s and/or
Shareholder’s insurance policies in effect prior to the Closing.




     Section 9.6 Indemnification as Exclusive Remedy. Subject to the limitations set forth
in this Article IX, (a) the indemnification provided in Section 9.2(a) shall be
Purchaser’s and Holdings’ exclusive post-Closing monetary remedy for any breach by Shareholder, CTH
LLC or the Company of any representation, warranty or covenant contained herein, and (b) the
indemnification provided in Section 9.2(b) shall be Shareholder’s exclusive post-Closing
monetary remedy available for any breach by Purchaser or Holdings of any representation, warranty
or covenant contained herein, except in each case with regard to fraud. Notwithstanding the
preceding sentence, each of the Parties acknowledges and agrees that the other Parties hereto would
be damaged irreparably in the event any of the provisions of this Agreement are not performed in
accordance with their specific terms or otherwise are breached. Accordingly, each of the Parties
hereto agrees that the other Parties hereto shall be entitled to an injunction (without the posting
of a bond) to prevent breaches of the provisions of this Agreement and to enforce specifically this
Agreement and the terms and provisions hereof (including the indemnification provisions hereof) in
any competent court having jurisdiction over the Parties, in addition to any other remedy to which
they may be entitled at law or in equity.



     Section 9.7 Waiver, Release and Discharge.



          (a) Effective upon the Closing, each of Shareholder and CTH LLC hereby irrevocably waives,
releases and discharges the Company and its Subsidiaries from any and all liabilities and
obligations to Shareholder or CTH LLC arising from or based upon such Person’s status as a
shareholder (including, without limitation, in respect of rights of contribution or
indemnification), in each case, whether absolute or contingent, liquidated or unliquidated, known




66









 







or unknown, and whether arising hereunder or under any other agreement or understanding or
otherwise at law or equity, and neither Shareholder nor CTH LLC shall seek to recover any amounts
in connection therewith or thereunder from the Company or its Subsidiaries.




          (b) Each Party represents that such party has read Section 1542 of the Civil Code of the State
of California (“Section 1542”), which provides as follows:



A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN
HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR.




          (c) Each of Shareholder and CTH LLC understands that Section 1542 gives such Party the right
not to release existing claims of which such Party is not now aware, unless such Party voluntarily
chooses to waive this right. Having been so apprised, each of Shareholder and CTH LLC voluntarily
elects to and does waive the rights described in Section 1542 and elects to assume all risks for
claims that existed in such Party’s favor, known or unknown, from the subject of this release.




ARTICLE X

MISCELLANEOUS




     Section 10.1 Entire Agreement. This Agreement (including the Schedules and Exhibits
hereto), the Transaction Documents and the Confidentiality Agreement and the documents referred to
herein and therein constitute the entire agreement among the Parties with respect to the subject
matter hereof and no Party shall be liable or bound to any other Party in any manner by any
warranties, representations or covenants except as specifically set forth herein or therein.



     Section 10.2 Governing Law; Jurisdiction. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of Delaware applicable to contracts
executed and fully performed within the State of Delaware, without regard to the conflicts of laws
provisions thereof. Any action, hearing, suit or proceeding arising out of or relating to this
Agreement or any transaction contemplated by this Agreement must be brought in the courts of the
State of Delaware, or, if it has or can acquire jurisdiction, in the United States District Court
for the District of Delaware. Each Party irrevocably submits to the exclusive jurisdiction of each
such court in any such proceeding and waives any objection it may now or hereafter have to venue or
to convenience of forum. The Parties agree that any or all of them may file a copy of this
Section 10.2 with any court as written evidence of the knowing, voluntary and bargained
agreement between the Parties irrevocably to waive any objections to venue or to convenience of
forum.



     Section 10.3 Waiver of Right to Jury Trial. PURCHASER, HOLDINGS, THE COMPANY,
SHAREHOLDER, AND CTH LLC TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING AS TO ANY ISSUE RELATING HERETO IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE CONTEMPLATED
TRANSACTIONS.



67









 





     Section 10.4 Notices. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be delivered by hand, mailed by registered or certified
mail (return receipt
requested), deposited with a reputable, established overnight courier service for delivery to
the intended addressee against receipt, or sent by telecopy (confirmed by regular, first-class
mail), to Shareholder and Purchaser at the following addresses (or at such other addresses for a
Party as shall be specified by like notice) and shall be deemed given on the date on which such
notice is received:



	 	 	 	 	 
	 

	 	if to Shareholder:
	 	Syufy Enterprises, LP
	 

	 	(or CTH LLC)
	 	150 Pelican Way
	 

	 	 	 	San Rafael, CA 94901
	 

	 	 	 	Attention: Chief Executive Officer
	 

	 	 	 	Fax:
	 
	 	 	 	 
	 

	 	and a copy to:
	 	Syufy Enterprises, LP
	 

	 	 	 	150 Pelican Way
	 

	 	 	 	San Rafael, CA 94901
	 

	 	 	 	Attention: General Counsel
	 

	 	 	 	Fax: 415-448-8475
	 
	 	 	 	 
	 

	 	and a copy	 	 
	 

	 	(which shall not	 	 
	 

	 	constitute notice) to:
	 	Morrison & Foerster LLP
	 

	 	 	 	425 Market Street
	 

	 	 	 	San Francisco, CA 94105
	 

	 	 	 	Fax: 415-268-7522
	 

	 	 	 	Attention: John W. Campbell, Esq.
	 
	 	 	 	 
	 

	 	if to Purchaser:
	 	Cinemark, Inc.
	 

	 	(or Holdings)
	 	3900 Dallas Parkway, Suite 500
	 

	 	 	 	Plano, Texas 75093
	 

	 	 	 	Facsimile: (972) 665-1004
	 

	 	 	 	Attention: Chief Executive Officer
	 
	 	 	 	 
	 

	 	 	 	and
	 
	 	 	 	 
	 

	 	 	 	Madison Dearborn Capital Partners
	 

	 	 	 	Three First National Plaza, 38th Floor
	 

	 	 	 	Chicago, IL 60602
	 

	 	 	 	Fax: (312) 895-1056
	 

	 	 	 	Attention: Benjamin D. Chereskin
	 

	 	 	 	                 Vahe Dombalagian
	 
	 	 	 	 
	 

	 	and a copy	 	 
	 

	 	(which shall not	 	 






68









 






	 	 	 	 	 
	 

	 	constitute notice) to:
	 	Cinemark, Inc.
	 

	 	 	 	3900 Dallas Parkway, Suite 500
	 

	 	 	 	Plano, Texas 75093
	 

	 	 	 	Facsimile: (972) 665-1004
	 

	 	 	 	Attention: Michael Cavalier
	 
	 	 	 	 
	 

	 	 	 	Kirkland & Ellis LLP
	 

	 	 	 	200 E. Randolph Drive
	 

	 	 	 	Chicago, IL 60601
	 

	 	 	 	Fax: (312) 861-2200
	 

	 	 	 	Attention: Edward T. Swan, P.C.
	 

	 	 	 	                 Michael D. Paley






     Section 10.5 Successors and Assigns. Except as otherwise provided herein, the terms
and conditions of this Agreement shall inure to the benefit of and be binding upon the respective
successors and permitted assigns of the Parties. Neither the rights nor the obligations under this
Agreement shall be assigned or delegated by operation of law or otherwise and any attempted
assignment or delegation in violation of this provision shall be null and void; provided
that each of Purchaser and Holdings shall have the right to assign all or any portion of their
respective rights and obligations under this Agreement to (i) one or more wholly-owned subsidiaries
of Purchaser or Holdings (including any subsidiary which may be organized subsequent to the date
hereof), (ii) in connection with a merger or consolidation involving Purchaser or Holdings or other
disposition of all or substantially all of their respective assets or any of the divisions of
Purchaser or Holdings, or (iii) to any lender providing financing to Purchaser, Holdings or their
respective Affiliates, for collateral security purposes, and any such lender may exercise all of
the rights and remedies of Purchaser or Holdings hereunder, provided that no such
assignment shall in any manner limit or impair Purchaser’s or Holdings’ obligations hereunder.



     Section 10.6 Confidentiality. This Agreement is not intended to supersede or replace the
Confidentiality Agreement. The Confidentiality Agreement will survive the execution and delivery
of this Agreement and remain in full force and effect in accordance with its terms and Purchaser
will continue to be obligated to perform and comply with its obligations under the Confidentiality
Agreement until the Closing, subject to Section 6.13. Upon the consummation of the
Closing, the Parties hereto agree that the Confidentiality Agreement shall terminate and forthwith
become null and void in all respects and cease to have any further effect.



     Section 10.7 Expenses. Except as otherwise expressly provided in this Agreement,
irrespective of whether the Closing is effected, each Party shall pay all costs and expenses that
it incurs with respect to the negotiation, execution, delivery and performance of this Agreement
and the other documents or agreements contemplated hereby; provided that if the Closing
occurs, the Company shall pay, at the Closing, all of the Purchaser Expenses.



     Section 10.8 Attorneys’ Fees. In any action at law or suit in equity to enforce this Agreement or the rights of any of
the Parties hereunder, the prevailing Party in such action or suit shall be entitled to receive a
reasonable sum for its attorneys’ fees and all other reasonable costs and expenses incurred in such
action or suit.



69









 





     Section 10.9 Amendments and Waivers. Subject to the provisions of Section
6.4, this Agreement may not be amended, supplemented or modified except by an agreement in
writing signed by Shareholder and either of Purchaser or Holdings. No waiver shall be effective
unless it is in writing and is signed by the Party asserted to have granted such waiver. Any
amendment or waiver effected in accordance with this paragraph or Section 6.4 shall be
binding upon the Parties hereto and each future holder of the Shares. The waiver by any Party
hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver
of any subsequent breach.



     Section 10.10 Severability. The provisions of this Agreement shall be deemed
severable and if one or more provisions of this Agreement are held to be invalid or unenforceable
under applicable law, such provision shall be excluded from this Agreement and the balance of the
Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms, unless such invalidity or enforceability after taking into account the
mitigation contemplated by this Section 10.10 deprives a Party of a material benefit
contemplated by the Agreement.



     Section 10.11 Interpretation. Unless otherwise indicated herein, with respect to any
reference made in this Agreement to a Section, Article, Subsection, Paragraph, Subparagraph,
Clause, Exhibit or Schedule, such reference shall be to a section, article, subsection, paragraph,
subparagraph or clause of, or an exhibit or schedule to, this Agreement. Any article, section,
subsection, paragraph or subparagraph headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be
deemed to be followed by the words “but (is/are) not limited to.” Words used herein, regardless of
the number and gender specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the context indicates
is appropriate. Where specific language is used to clarify or illustrate by example a general
statement contained herein, such specific language shall not be deemed to modify, limit or restrict
the construction of the general statement which is being clarified or illustrated. The Schedules
and Exhibits identified in this Agreement, including the Company Disclosure Schedule and the
Shareholder Disclosure Schedule, are incorporated herein by reference and made a part of this
Agreement. This Agreement shall be construed without regard to any presumption or rule requiring
construction or interpretation against the Party drafting or causing any instrument to be drafted.
The phrases “made available to the Purchaser” or “furnished to the Purchaser” or similar phrases as
used in this Agreement mean that true and complete copies of the subject documents were posted to
the “Project Oscar” data room at www.intralinks.com on or
prior to, and remain accessible to the Purchaser on, the date that is two days prior to the
date of this Agreement.



     Section 10.12 Corporate Securities Law. THE SALE OF THE SECURITIES THAT ARE THE
SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE
OF CALIFORNIA AND THE SALE OF SUCH SECURITIES AND THE PAYMENT OR RECEIPT OF ANY PART OF THE
CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS
EXEMPT FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA



70









 




CORPORATIONS CODE.
THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING
OBTAINED, UNLESS THE SALE IS SO EXEMPT.




     Section 10.13 No Third Party Beneficiaries. This Agreement is solely for the benefit
of the Company, CTH LLC, Shareholder, Purchaser and Holdings and their permitted assigns and
nothing herein, express or implied, is intended to or shall confer upon any other Persons any
rights or remedies hereunder.



     Section 10.14 Counterparts. This Agreement may be executed in two or more
counterparts (by original or facsimile signature), each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.



[signature pages follow]




71









 








     IN WITNESS WHEREOF, the Parties have executed this Stock Purchase Agreement as of the date
first above written.



	 	 	 	 	 	 	 	 	 
	CENTURY THEATRES, INC.	 	CINEMARK USA, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	Name: 

	 

	 	Name: 
	 

	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	SYUFY ENTERPRISES, LP	 	CINEMARK HOLDINGS, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	Name:

	 

	 	Name:
	 

	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	CENTURY THEATRES HOLDINGS, LLC	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 
	Name:

	 

	 	 	 	 	 	 
	Title: