Document:

Exhibit 10.1

 

EXECUTION COPY

 

SEVENTH AMENDMENT AND WAIVER TO CREDIT AGREEMENT

 

This SEVENTH AMENDMENT AND
WAIVER TO CREDIT AGREEMENT (“Amendment”), dated as of January 13,
2010, is by and among PINNACLE GAS RESOURCES,
INC., a Delaware  corporation,
the Lenders from time to time party hereto, and THE ROYAL
BANK OF SCOTLAND plc, as Administrative Agent and as Lender.

 

WHEREAS, the Borrower, the
Lenders and the Administrative Agent are parties to that certain Credit
Agreement (as amended by that certain Letter Regarding Waiver and Amendment to
Credit Agreement dated March 9, 2007, the Second Amendment to Credit
Agreement dated as of August 4, 2008, the Third Amendment to Credit
Agreement dated as of September 30, 2008, the Fourth Amendment to Credit
Agreement dated as of April 14, 2009, the Fifth Amendment and Waiver to
Credit Agreement dated as of August 26, 2009 and the Sixth Amendment to
Credit Agreement dated as of October 20, 2009 and as further amended and
supplemented from time to time, the “Credit Agreement); and

 

WHEREAS, the parties hereto
desire to amend the Credit Agreement in certain respects as set forth herein;

 

NOW THEREFORE, in
consideration of the premises and the mutual covenants, representations and
warranties contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

 

AGREEMENT

 

Section 1.               Definitions. 
Capitalized terms used herein but not defined herein shall have the
meanings as given them in the Credit Agreement, unless the context otherwise
requires.

 

Section 2.               Waivers.

 

(a)                                         The Administrative Agent and the Lenders
hereby waive for the period ending on the earlier of June 15, 2010 and the
date of any Default or Event of Default arising out of any breach of or
non-compliance with the Credit Agreement not expressly waived hereunder or any
breach of the agreements in this Agreement (the “Waiver Date”), the
requirement in Section 7.15.2 of the Credit Agreement that the
Borrower not permit the ratio of its Current Assets to its Current Liabilities
to be less than 1.00 to 1.00 for the fiscal quarters ending June 30, 2009,
September 30, 2009, December 31, 2009 and March 31, 2010.  The waiver in this Section 2 is
effective only for the period ending on the Waiver Date and only for the fiscal
quarters ending June 30, 2009, September 30, 2009, December 31,
2009 and March 31, 2010, and not any other period or fiscal quarter.

 

(b)                                        The Administrative Agent and the Lenders
hereby waive for the period ending on the Waiver Date the requirements of Section 7.6.2
of the Credit Agreement to the extent and only to the extent that (i) the
failure to pay accounts payable within ninety (90) days of the date of the
invoice therefor would cause such accounts not to be Permitted Debt and (ii) that
the aggregate amount of all such accounts payable not so paid within ninety
(90) days of 

 

 

the date of the invoice
therefor does not exceed $6,000,000.  The
waiver in this Section 2(b) is effective only to the extent that such
failure to pay accounts payable causes such accounts payable not to be
Permitted Debt and only with respect to the period ending on the Waiver Date
and not any other period and only to the extent that the aggregate of all such
accounts payable not so paid within ninety (90) days of the date of the invoice
therefor does not exceed $6,000,000.

 

(c)                                         The Administrative Agent and the Lenders
hereby waive for the period ending on the Waiver Date the requirements of Section 7.6.3
of the Credit Agreement that the Borrower pay the trade and other accounts
payable within 90 days after the invoice date therefore, provided that this
waiver is only effective with respect to trade and other accounts not exceeding
$6,000,000 in the aggregate at any time outstanding.  The waiver in this Section 2(c) is
effective only with respect to (i) the period ending on the Waiver Date
and not any other period and (ii) trade and other accounts not exceeding
$6,000,000 in the aggregate at any time outstanding.

 

(d)                                        The Administrative Agent and the Lenders
hereby waive for the period ending on the Waiver Date the requirements of Section 7.7
of the Credit Agreement that the Borrower and its Subsidiaries not allow Liens
on any of its Property to the extent but only to the extent of Liens not
securing amounts in excess in the aggregate of $2,500,000.  The waiver in this Section 2(d) is
effective only with respect to (i) the period ending on the Waiver Date
and not any other period and (ii) only with respect to Liens not securing amounts
in excess in the aggregate of $2,500,000.

 

Section 3.                                            Modification of Certain Dates. 
The Borrower, Agent and Lenders agree that the references to “January 5,
2010”, in Section 4 of the Fifth Amendment, as amended by the Waiver and
Agreement dated October 26, 2009, the Waiver and Agreement dated November 16,
2009, the Waiver and Agreement dated November 23, 2009, the Waiver and
Agreement dated December 1, 2009 and the Waiver and Agreement dated January 5,
2010, shall be amended and restated to read “June 15, 2010”.  As amended by the preceding sentence, the
provisions of such Section 4 of the Fifth Amendment, as heretofore
amended, shall continue to be effective from and after the date of this
Agreement.

 

Section 4.                                            Amendments to Credit Agreement.

 

(a)                                         The definition of “Applicable Margin”
in Section 1.1 of the Credit Agreement is hereby amended to read as
follows:

 

““Applicable Margin”
means 2.25% for Eurodollar Loans and 1.25% for ABR Loans.”

 

(b)                                        *                                         CONFIDENTIAL TREATMENT REQUESTED.  THE UNREDACTED AGREEMENT HAS BEEN FILED WITH
THE SEC WITH THE CONFIDENTIAL TREATMENT REQUEST.

 

(c)                                         The definition of “Letter of Credit
Commitment Termination Date” in Section 1.1 of the Credit
Agreement is hereby amended to read as follows:

 

2

 

““Letter of Credit
Commitment Termination Date” means January 13, 2010.”

 

(d)                                        *                                         CONFIDENTIAL TREATMENT REQUESTED.  THE UNREDACTED AGREEMENT HAS BEEN FILED WITH
THE SEC WITH THE CONFIDENTIAL TREATMENT REQUEST.

 

(e)                                         *                                         CONFIDENTIAL TREATMENT REQUESTED.  THE UNREDACTED AGREEMENT HAS BEEN FILED WITH
THE SEC WITH THE CONFIDENTIAL TREATMENT REQUEST.

 

(f)                                           Section 2.1.1(a) of the Credit Agreement is hereby
amended by deleting the phrase “the Final Maturity Date” and inserting in lieu
thereof the date “January 13, 2010.”

 

(g)                                        Section 2.9.1 of the Credit Agreement is hereby
amended to read in its entirety as follows:

 

“Section 2.9.1.  The Loan Commitments shall terminate on January 13, 2010
and the Letter of Credit Commitment shall terminate on January 13, 2010.”

 

(h)                                        Section 2.9.2 of the Credit Agreement is hereby
amended by adding the phrase “the date which is thirty (30) days following”
after the word “on” and before the phrase “the Final Maturity Date.”

 

(i)                                            *                                         CONFIDENTIAL TREATMENT REQUESTED.  THE UNREDACTED AGREEMENT HAS BEEN FILED WITH
THE SEC WITH THE CONFIDENTIAL TREATMENT REQUEST.

 

Section 5.                                            Borrowing Base. 
Notwithstanding the provisions of Section 2.8 of the Credit
Agreement, the Administrative Agent, the Lenders and the Borrower hereby agree
that the Borrowing Base under the Credit Agreement has been designated at the
following amounts for the following applicable periods (and the Borrowing Base
shall not be redetermined at any time after January 13, 2010, except
pursuant to Section 2.8.4 of the Credit Agreement):

 

	
  APPLICABLE
  PERIOD

  	
   

  	
  BORROWING BASE

  	
   

  
	
  January 1, 2010 through January 31, 2010

  	
   

  	
  $6,100,000

  	
   

  
	
  February 1, 2010 through February 28,
  2010

  	
   

  	
  $5,900,000

  	
   

  
	
  March 1, 2010 through March 31, 2010

  	
   

  	
  $5,700,000

  	
   

  
	
  April 1, 2010 through April 30, 2010

  	
   

  	
  $5,500,000

  	
   

  
	
  Each calendar month thereafter commencing
  May 1, 2010

  	
   

  	
  the
  Borrowing Base for the preceding calendar month reduced by $200,000

  	
   

  

 

3

 

Notwithstanding the
provisions of Sections 2.8.8 and 3.4.1(c) of the Credit
Agreement, if at any time during any of the foregoing applicable periods, the
aggregate Credit Exposure of all Lenders exceeds the Borrowing Base set forth
above with respect to such applicable period, then the Borrower shall
immediately prepay the Advances in an aggregate principal amount equal to such
excess.  Failure to make any such
prepayment shall constitute an immediate Event of Default for all purposes of
the Credit Agreement and the other Loan Documents.

 

Section 6.               Assignments. 
Notwithstanding anything to the contrary in the Credit Agreement, on and
after the Final Maturity Date (i) any Lender may at any time, without the
consent of the Borrower, assign all or any portion of its Loans and its rights
under this Agreement, its Note and the other Loan Documents to any other Person
and (ii) the Administrative Agent may resign at any time, effective
immediately upon notice to the Borrowers and the Lenders, and upon such resignation
shall have the right to designate any Person as successor Administrative Agent.

 

Section 7.               * CONFIDENTIAL TREATMENT REQUESTED.  THE UNREDACTED AGREEMENT HAS BEEN FILED WITH
THE SEC WITH THE CONFIDENTIAL TREATMENT REQUEST.

 

Section 8.               Interest Elections and Conversions. 
Notwithstanding any provisions of the Credit Agreement commenting,
commencing on the Effective Date all Advances shall be Base Rate Advances and
Borrower shall not have the right to elect to convert any Advance into, or
continue any Advance as, a Eurodollar Advance.

 

Section 9.               Conditions to Effectiveness. 
This Amendment shall be deemed effective as of January 13, 2010
(the “Effective Date”) when the Administrative Agent shall have received
counterparts hereof duly executed by the Borrower, the Administrative Agent,
and the Required Lenders.

 

Section 10.             Representations and Warranties. 
The Borrower hereby represents and warrants that after giving effect
hereto:

 

(a)               the representations and warranties of the Borrower and
each Subsidiary contained in the Loan Documents are true and correct in all
material respects on and as of the date hereof, other than those
representations and warranties that expressly relate solely to a specific
earlier date, which shall remain correct in all material respects as of such
earlier date;

 

(b)              the execution, delivery and performance by the
Borrower and each Subsidiary of this Amendment has been duly authorized by all
necessary corporate action required on their part and this Amendment, along
with the Credit Agreement as amended hereby and other Loan Documents,
constitutes the legal, valid and binding obligation of each Obligor party
thereto enforceable against them in accordance with its terms, except as its
enforceability may be affected by the effect of bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting the rights or remedies of creditors generally;

 

(c)               neither the execution, delivery and performance of
this Amendment by the Borrower and each Subsidiary, the performance by them of
the Credit Agreement nor the 

 

4

 

consummation of the
transactions contemplated hereby does or shall contravene, result in a breach
of, or violate (i) any provision of the Borrower or any Subsidiary’s
certificate or articles of incorporation or bylaws or other similar documents,
or agreements, (ii) any law or regulation, or any order or decree of any
court or government instrumentality, or (iii) any indenture, mortgage,
deed of trust, lease, agreement or other instrument to which the Borrower or
any of its Subsidiaries is a party or by which the Borrower or any of its
Subsidiaries or any of their property is bound, except in any such case to the
extent such conflict or breach has been waived herein or by a written waiver
document, a copy of which has been delivered to Administrative Agent on or
before the date hereof;

 

(d)              no Material Adverse Effect has occurred and is
continuing; and

 

(e)               no Default or Event of Default that the Administrative
Agent and the Lenders have not waived in writing or that has not otherwise been
disclosed to the Administrative Agent has occurred and is continuing.

 

Section 11.             Ratification.

 

(a)               This Amendment shall be deemed to be an amendment to
the Credit Agreement, and the Credit Agreement, as hereby amended, and all
Obligations in connection therewith, are hereby ratified, approved and
confirmed in each and every respect.  On
and after the effectiveness of this Amendment in accordance with Section 4
above, each reference in the Credit Agreement to “this
Agreement”, “hereunder”, “hereof” or words of like import, referring to the
Credit Agreement, and each reference in each other Loan Document to “the Credit Agreement”, “thereunder”,
“thereof” or words of like import referring
to the Credit Agreement, shall mean and be a reference to the Credit Agreement
as amended or otherwise modified by this Amendment.  This Amendment is a Loan Document.

 

(b)              The Borrower and each of its Subsidiaries hereby
ratifies, approves and confirms in every respect all the terms, provisions,
conditions and obligations of each of the Security Documents, including without
limitation all Mortgages, Pledge and Security Agreements, and Guaranties, to
which it is a party.

 

Section 12.             Costs and Expenses.  As provided
in Section 9.4 of the Credit Agreement, the Borrower agrees to
reimburse Administrative Agent on demand for all fees, costs, and expenses,
including the reasonable fees, costs, and expenses of counsel or other advisors
for advice, assistance, or other representation in connection with the Credit
Agreement and this Amendment.

 

Section 13.             GOVERNING LAW. THIS AGREEMENT HAS BEEN NEGOTIATED,
IS BEING EXECUTED AND DELIVERED, AND WILL BE PERFORMED IN WHOLE OR IN PART, IN
THE STATE OF NEW YORK, AND THE SUBSTANTIVE LAWS OF SUCH STATE AND THE
APPLICABLE FEDERAL LAWS OF THE UNITED STATES OF AMERICA SHALL GOVERN THE
VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION OF THE LOAN DOCUMENTS,
EXCEPT TO THE EXTENT THE LAWS OF ANY JURISDICTION 

 

5

 

WHERE
COLLATERAL IS LOCATED REQUIRE APPLICATION OF SUCH LAWS WITH RESPECT TO SUCH
COLLATERAL.

 

Section 14.             Severability. 
Any provision of this Amendment that is prohibited or unenforceable in
any jurisdiction shall, as to such provision and such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Amendment or affecting the
validity or enforceability of such provision in any other jurisdiction.

 

Section 15.             Counterparts. 
This Amendment may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any
party hereto may execute this Amendment by signing one or more
counterparts.  Any signature hereto
delivered by a party by facsimile transmission shall be deemed to be an
original signature hereto.

 

Section 16.             No Waiver.  Except as
expressly set forth in this Amendment, the execution, delivery and
effectiveness of this Amendment shall not operate as a waiver of any default of
the Borrower or any other Obligor or any right, power or remedy of the
Administrative Agent or the other Secured Parties under any of the Loan
Documents, nor constitute a waiver of any provision of any of the Loan
Documents.

 

Section 17.             Successors and Assigns. 
This Amendment shall be binding upon the Borrower and its successors and
permitted assigns and shall inure, together with all rights and remedies of
each Lender hereunder, to the benefit of each Lender and the respective
successors, transferees and assigns.

 

Section 18.             Entire Agreement. 
THIS AMENDMENT, THE  CREDIT
AGREEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE AGREEMENT BETWEEN
THE PARTIES HERETO WITH RESPECT TO THE SUBJECT HEREOF AND SHALL SUPERSEDE ANY
PRIOR AGREEMENT BETWEEN THE PARTIES HERETO, WHETHER WRITTEN OR ORAL, RELATING
TO THE SUBJECT HEREOF.  FURTHERMORE, IN
THIS REGARD, THIS AGREEMENT  REPRESENTS
THE FINAL AGREEMENT AMONG THE PARTIES THERETO AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF SUCH
PARTIES.

 

THERE ARE NO UNWRITTEN
ORAL AGREEMENTS AMONG SUCH PARTIES.

 

[Signature Pages Follow]

 

6

 

IN WITNESS WHEREOF, the
parties hereto have caused this Amendment to be duly executed and delivered by
their respective duly authorized officers as of the date hereof.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  PINNACLE
  GAS RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Peter G. Schoonmaker

  
	
   

  	
  Name:

  	
  Peter
  G. Schoonmaker

  
	
   

  	
  Title:

  	
  Chief Executive Officer
  and President

  
				

 

7

 

	
   

  	
  ADMINISTRATIVE
  AGENT:

  
	
   

  	
   

  
	
   

  	
  THE
  ROYAL BANK OF SCOTLAND plc,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Charles Greer

  
	
   

  	
  Name:

  	
  Charles
  Greer

  
	
   

  	
  Title:

  	
  Senior Vice President

  
				

 

8

 

	
   

  	
  LENDER:

  
	
   

  	
   

  
	
   

  	
  THE
  ROYAL BANK OF SCOTLAND plc,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Charles
  Greer

  
	
   

  	
  Name:

  	
  Charles
  Greer

  
	
   

  	
  Title:

  	
  Senior Vice President

  
				

 

9Exhibit
10.1

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT
AGREEMENT (this “Agreement”) is
made as of January 13, 2010, by and between Regal Entertainment Group, a
Delaware corporation (the “Company”),
and Peter B. Brandow (“Executive”).

 

RECITALS

 

In order to induce
Executive to serve as Executive Vice President, General Counsel and Secretary
of the Company, the Company desires to provide Executive with compensation and
other benefits on the terms and conditions set forth in this Agreement.

 

Executive is
willing to accept such employment and perform services for the Company as of
the Effective Date (as defined below), on the terms and conditions hereinafter
set forth.

 

It is therefore
hereby agreed by and between the parties as follows:

 

1.                                       Employment.

 

1.1                                 Position.  Subject to the terms and conditions of this Agreement,
the Company agrees to employ Executive during the Term (as defined herein) as
its Executive Vice President, General Counsel and Secretary. In his capacity as
Executive Vice President, General Counsel and Secretary of the Company,
Executive shall have the powers, responsibilities and authorities of general
counsels of corporations of the size, type and nature of the Company, as it
exists from time to time, as are assigned by the Chief Executive Officer
consistent with Executive’s position. At the request of the Company, Executive
will serve as an officer and/or director of any of the Company’s other
subsidiaries for no additional compensation.

 

1.2                                 Duties.  Subject to the terms and conditions of this Agreement,
Executive hereby agrees to be employed as Executive Vice President, General
Counsel and Secretary of the Company and agrees to devote such working time and
efforts (except for permitted vacation periods and reasonable periods of
illness and other incapacity), to the best of his ability, experience and
talent, to the performance of services, duties and responsibilities in
connection therewith so that such performance shall be his primary business
activity. Executive shall perform such duties and exercise such powers with
respect to the activities of the Company, commensurate with his position, as Executive
Vice President, General Counsel and Secretary of the Company, as the Chief
Executive Officer shall from time to time reasonably delegate to him.

 

1.3                                 Other Service.  Nothing in this Agreement shall preclude Executive
from serving on boards of directors of other companies or trade organizations
and participating in charitable, community or religious activities that do not
substantially interfere with his duties and responsibilities hereunder or
conflict with the interest of the Company.

 

1.4                                 Reporting. 
Executive shall report directly to (a) Amy E. Miles, Chief Executive
Officer of the Company or (b) if Ms. Miles is no longer employed by the Company,
the then existing Chief Executive Officer of the Company.

 

2.                                       Term.

 

2.1                                 Term of
Employment.  Executive’s term of employment under this
Agreement shall commence as of the Effective Date (as defined below), and,
subject to the terms hereof, shall terminate on the earlier of (i) the third
anniversary of the Effective Date, or (ii) termination of Executive’s
employment pursuant to this Agreement (the “Term”);
provided, however, that any
termination of employment by Executive (other than for death or Permanent
Disability) or by the Company may only be made upon 90 days prior written
notice to the other party hereto. Executive shall resign from any and all
positions, including board memberships, held by him with the Company or any
subsidiary of the Company upon any termination of employment.

 

 

2.2                                 Extensions.  On each anniversary of the date hereof, commencing in
2011, one year shall be added to the termination date specified in Section 2.1(i)
hereof, so that as of each anniversary of the date hereof the remaining Term of
Executive’s employment as determined under Section 2.1(i) hereof shall be three
(3) years.

 

2.3                                 Effective Date.  This Agreement shall only be effective and enforceable
by the Company or Executive as of the date hereof (the “Effective Date”).

 

3.                                       Compensation.

 

3.1                                 Salary.  The Company shall pay Executive a base salary (“Base Salary”) at the rate of $370,000 per
annum commencing on the beginning of Executive’s term of employment hereunder.
Base Salary shall be payable in accordance with the ordinary payroll practices
of the Company. The Compensation Committee of the Board of Directors of the
Company will review Executive’s salary at least annually and may increase (but
not reduce) Executive’s Base Salary in its sole discretion. Once increased such
Base Salary shall not be reduced, and, as so increased, shall constitute “Base
Salary” hereunder.

 

3.2                                 Annual Bonus.  In addition to his Base Salary, Executive shall,
commencing with the 2010 fiscal year and continuing each fiscal year during the
Term hereafter, be afforded a reasonable opportunity to earn an annual cash
bonus (the “Bonus”).  The Company shall be deemed to have provided
Executive with such opportunity by establishing one or more reasonable annual
performance goals for the Company (the “Annual
Performance Goals”) under an annual executive incentive plan (a “Bonus Plan”) designed to pay a bonus should
the Company meet or exceed such goals. 
In determining Executive’s Bonus, Executive’s target Bonus shall be at
least 75% of Base Salary (the “Target Bonus”).  If in any year the Annual Performance Goals
for the Company are exceeded by a material amount, the Company shall award
Executive a “stretch” Bonus of up to an additional 37.5% of Base Salary (for a
total Bonus of up to 112.5% of Base Salary) as determined by the Compensation
Committee of the Board.  For 2010,  Executive’s Bonus shall be calculated in
accordance with the Company’s 2010 Bonus Plan as adopted by the Board prior to
the date hereof.  After 2010, the
Compensation Committee of the Board, after consultation with management, will
in the last quarter of each year establish reasonable eligibility requirements
and Annual Performance Goals for the Bonus Plan for the next year based on the
actual and projected performance of the Company. Executive shall be deemed to
have earned an annual Bonus under the Company’s Bonus Plan so long as Executive
meets the Annual Performance Goals established thereunder and is employed by
the Company as of the last day of the Company’s fiscal year.

 

4.                                       Employee Benefits.

 

4.1                                 Employee Benefit
Programs, Plans and Practices.  The Company shall during the Term provide Executive
with coverage under all employee pension and welfare benefit programs, plans
and practices (to the extent permitted under any employee benefit plan) in
accordance with the terms thereof, which the Company generally makes available
to its senior executives.

 

4.2                                 Vacation.  While employed hereunder, Executive shall be entitled
to no less than 20 business days paid vacation in each calendar year, which
shall be taken at such times as are consistent with Executive’s
responsibilities hereunder.

 

5.                                       Expenses.  Executive is authorized to incur reasonable expenses
in carrying out his duties and responsibilities under this Agreement. The
Company will reimburse Executive for such expenses upon presentation by
Executive from time to time of appropriately itemized and approved (consistent
with the Company’s policy) accounts of such expenditures.

 

6.                                       Termination of
Employment.

 

6.1                                 Termination Without Cause.  Except as provided in Section 6.3, if Executive’s
employment is terminated by the Company (other than for Permanent Disability,
death or Cause),

 

 

Executive shall receive such payments, if any, under
applicable plans or programs, including but not limited to those referred to in
Section 4.1 hereof, to which he is entitled pursuant to the terms of such plans
or programs, and any unpaid payments of Base Salary previously earned, any
unpaid Bonus earned or awarded for prior periods, accrued vacation and expense
incurred for which Executive is entitled to reimbursement hereunder. If
Executive is terminated under this Section 6.1, Executive shall also be
entitled to receive:

 

(a)  an amount in lieu of any other cash
compensation beyond that provided in the immediately preceding sentence, which
amount shall be equal to the sum of:

 

(i)  the actual bonus, if any, he would have
received in respect of the fiscal year in which his termination occurs,
prorated by a fraction, the numerator of which is the number of days in such
fiscal year prior to the date of Executive’s termination and the denominator of
which is 365, payable at the same time as bonuses are paid to other executives;

 

(ii)  two times Executive’s annual Base Salary; plus
one times Executive’s Target Bonus; payable in a lump sum within 30 days
following such termination of employment; provided that if such termination
occurs within 90 days prior to calendar year end, amount shall be payable on January
1 of the year following the date of Executive’s termination; and

 

(b)  continued coverage for a 24-month period under
any employee medical, health and life insurance plans in accordance with the
respective terms thereof applicable to active employees (other than the
requirement of continued employment); provided, however, that payments and
benefits due hereunder shall be reduced by any amounts owed by Executive to the
Company.

 

In no event shall
Executive be obligated to seek other employment or take any other action by way
of mitigation of the amounts payable to Executive under any of the provisions
of this Agreement and such amounts shall not be reduced whether or not
Executive obtains other employment.

 

6.2                                 Termination For Good
Reason.  Except as provided in Section 6.3, Executive may
resign for Good Reason (as defined below) if Executive provides written
notification to the Company of the existence of a condition constituting Good
Reason (“Notification”) within
ninety (90) days of the initial existence of such condition (“Existence Date”) and the resignation occurs
within two (2) years of the Existence Date. 
If Executive resigns for Good Reason, Executive shall receive such
payments, if any, under applicable plans or programs, including but not limited
to those referred to in Section 4.1 hereof, to which he is entitled pursuant to
the terms of such plans or programs, and any unpaid payments of Base Salary
previously earned, any unpaid Bonus earned or awarded for prior periods,
accrued vacation and expense incurred for which Executive is entitled to reimbursement
hereunder. If Executive resigns under this Section 6.2, Executive shall also be
entitled to receive:

 

(a)  an amount in lieu of any other cash
compensation beyond that provided in the immediately preceding sentence, which
amount shall be equal to the sum of:

 

(i)  the actual bonus, if any, he would have
received in respect of the fiscal year in which his resignation occurs,
prorated by a fraction, the numerator of which is the number of days in such
fiscal year prior to the date of Executive’s resignation and the denominator of
which is 365, payable at the same time as bonuses are paid to other executives;

 

(ii)  two times Executive’s annual Base Salary; plus
one times Executive’s Target Bonus; payable in a lump sum within 30 days
following such resignation of employment; provided that if such resignation
occurs within 90 days prior to calendar year end, amount shall be payable on January
1 of the year following the date of Executive’s resignation; and

 

(b)  continued coverage for a 24-month period under
any employee medical, health and life insurance plans in accordance with the
respective terms thereof applicable to active employees (other than

 

 

the requirement of continued employment); provided,
however, that payments and benefits due hereunder shall be reduced by any
amounts owed by Executive to the Company.

 

Good Reason shall be defined as one or more of the
following conditions arising without the consent of Executive and which has not
been remedied by the Company within thirty (30) days after receipt of the
Notification:  (i) a material reduction
in Executive’s Base Salary or the establishment of or any amendment to the
annual cash bonus plan which would materially impair the ability of Executive
to receive the Target Bonus (other than the establishment of reasonable EBITDA
or other reasonable performance targets to be set annually in good faith by the
Board), (ii) a material diminution of Executive’s titles, offices, positions or
authority, excluding for this purpose an action not taken in bad faith; or the
assignment to Executive of any duties inconsistent with Executive’s position
(including status or reporting requirements), authority, or material
responsibilities, or the removal of Executive’s authority or material
responsibilities, excluding for this purpose an action not taken in bad faith, (iii)
a transfer of Executive’s primary workplace by more than fifty (50) miles from
the current workplace, (iv) a material breach of this Agreement by the Company(v)
Executive is not the Executive Vice President, General Counsel and Secretary of
the Company.

 

6.3                                 Termination During a
Change of Control.  Notwithstanding Section 6.1 or 6.2, if
within three months prior to or one year after a Change of Control (as defined
below), Executive’s employment is terminated by the Company (other than for
Permanent Disability, death or Cause) or Executive resigns for Good Reason,
Executive shall receive such payments, if any, under applicable plans or
programs, including but not limited to those referred to in Section 4.1 hereof,
to which he is entitled pursuant to the terms of such plans or programs, and
any unpaid payments of Base Salary previously earned, any unpaid Bonus earned
or awarded for prior periods, accrued vacation and expense incurred for which
Executive is entitled to reimbursement hereunder. If Executive is terminated or
resigns under this Section 6.3, Executive shall also be entitled to receive:

 

(a)  an amount in lieu of any other cash
compensation beyond that provided in the immediately preceding sentence, which
amount shall be equal to the sum of:

 

(i)  the actual bonus, if any, he would have
received in respect of the fiscal year in which his termination or resignation
occurs, prorated by a fraction, the numerator of which is the number of days in
such fiscal year prior to the date of Executive’s termination or resignation
and the denominator of which is 365, payable at the same time as bonuses are
paid to other executives; and

 

(ii)  two times Executive’s annual Base Salary; plus
one and one half times Executive’s Target Bonus payable in a lump sum within 30
days following such termination or resignation of employment; provided that if
such termination or resignation occurs within 90 days prior to calendar year
end, amount shall be payable on January 1 of the year following the date of
Executive’s termination or resignation; and

 

(b)  continued coverage for a 30-month period under
any employee medical, health and life insurance plans in accordance with the
respective terms thereof applicable to active employees (other than the
requirement of continued employment); provided, however, that payments and
benefits due hereunder shall be reduced by any amounts owed by Executive to the
Company.

 

A Change of Control
shall be deemed to have occurred upon both of the following occurring: (A) any
individual, entity, or group (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than Anschutz
Company, The Anschutz Corporation, or any entity or organization controlled by
Philip F. Anschutz (collectively, the “Anschutz
Entities”), of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) acquires 20% or more of the combined voting
power of the then-outstanding voting securities of the Company entitled to vote
generally in the election of directors (“Voting
Power”); and (B) such beneficial ownership (as so defined) by such
individual, entity or group of more than 20% of the Voting Power then exceeds
the beneficial ownership (as so defined) by the Anschutz Entities of the Voting
Power.

 

 

6.4                                 Permanent
Disability.  If Executive is unable to engage in the
activities required by Executive’s job by reason of any medically determined
physical or mental impairment which has lasted or can be expected to last for
continuous period of not less than six (6) consecutive months (“Permanent Disability”), the Company or
Executive may terminate Executive’s employment on written notice thereof, and
Executive shall receive or commence receiving, as soon as practicable:

 

(i)  the actual bonus, if any, he would have
received in respect of the fiscal year in which his termination occurs,
prorated by a fraction, the numerator of which is the number of days of the
fiscal year until termination and the denominator of which is 365, payable at
the same time as bonuses are paid to other executives; and

 

(ii)  accrued but unpaid Base Salary and such
payments under applicable plans or programs, including but not limited to those
referred to in Sections 4 and 5 hereof, to which he is entitled pursuant to the
terms of such plans or programs.

 

6.5                                 Death.  In the event of Executive’s death during the Term,
Executive’s estate or designated beneficiaries shall receive or commence
receiving, as soon as practicable:

 

(i)  the actual bonus, if any, he would have
received in respect of the fiscal year in which his death occurs, prorated by a
fraction, the numerator of which is the number of days of the fiscal year until
his death and the denominator of which is 365, payable at the same time as
bonuses are paid to other executives; and

 

(ii)  accrued but unpaid Base Salary and such
payments under applicable plans or programs, including but not limited to those
referred to in Sections 4 and 5 hereof, to which Executive’s estate or
designated beneficiaries are entitled pursuant to the terms of such plans or
programs.

 

6.6                                 Termination for Cause:
Resignation by Executive.

 

(a)  The Company shall have the right to terminate
the employment of Executive for Cause. In the event that Executive’s employment
is terminated by the Company for Cause or by Executive for any reason (other
than by Executive for Good Reason or as a result of Executive’s Permanent
Disability or death) during the Term, Executive shall not be entitled to the
payment of any compensation otherwise included under this Agreement. After the
termination of Executive’s employment under this Section 6.6, the obligations
of the Company under this Agreement to make any further payments, or provide any
benefits specified herein, to Executive shall thereupon cease and terminate.

 

(b)  As used herein, the term “Cause” shall be
limited to (i) any willful breach of any material written policy of the Company
that results in material and demonstrable liability or loss to the Company; (ii)
the engaging by Executive in conduct involving moral turpitude that causes
material and demonstrable injury, monetarily or otherwise, to the Company,
including, but not limited to, misappropriation or conversion of assets of the
Company (other than immaterial assets); (iii) conviction of or entry of a plea
of nolo contendere to a felony; or (iv) a material breach of this Agreement by
engaging in action in violation of the restrictive covenants in this Agreement.
No act or failure to act by Executive shall be deemed “willful” if done, or
omitted to be done, by him in good faith and with the reasonable belief that
his action or omission was in the best interest of the Company.

 

7.                                       Indemnification.  To the fullest extent permitted by the indemnification
provisions of the articles of incorporation and bylaws of the Company in effect
as of the date of this Agreement and the indemnification provisions of the
corporation statute of the jurisdiction of the Company’s incorporation in effect
from time to time (collectively, the “Indemnification
Provisions”), and in each case subject to the conditions thereof,
the Company shall (i) indemnify Executive, as a director and officer of the
Company or a subsidiary of the Company or a trustee or fiduciary of an employee
benefit plan of the Company or a subsidiary of the Company, or, if Executive
shall be serving in such capacity at the Company’s written

 

 

request, as a director or officer of any other
corporation (other than a subsidiary of the Company) or as a trustee or
fiduciary of an employee benefit plan not sponsored by the Company or a
subsidiary of the Company, against all liabilities and reasonable expenses that
may be incurred by Executive in any threatened, pending, or completed action,
suit or proceeding, whether civil, criminal or administrative, or investigative
and whether formal or informal, because Executive is or was a director or
officer of the Company, a director or officer of such other corporation or a
trustee or fiduciary of such employee benefit plan, and against which Executive
may be indemnified by the Company, and (ii) pay for or reimburse the reasonable
expenses incurred by Executive in the defense of any proceeding to which
Executive is a party because Executive is or was a director or officer of the
Company, a director or officer of such other corporation or a trustee or
fiduciary of such employee benefit plan. The rights of Executive under the
Indemnification Provisions shall survive the termination of the employment of
Executive by the Company.

 

8.                                       Notices.  All notices or communications hereunder shall be in
writing, addressed as follows:

 

To the Company:

 

Regal Entertainment Group

7132 Regal Lane 

Knoxville, TN 37918

Attn: Amy E. Miles, Chief Executive Counsel

 

To Executive:

 

Peter B. Brandow 

712 Gettysvue Drive

Knoxville, TN 37922

 

Any such notice or
communication shall be delivered by hand or by courier or sent certified or
registered mail, return receipt requested, postage prepaid, addressed as above
(or to such other address as such party may designate in a notice duly
delivered as described above), and the third business day after the actual date
of mailing shall constitute the time at which notice was given.

 

9.                                       Separability; Legal
Fees.  If any provision of this Agreement shall be declared
to be invalid or unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof which shall
remain in full force and effect. The non-prevailing party shall bear the costs
of any legal fees and other fees and expenses which may be incurred by the
prevailing party in respect of enforcing its respective rights under this
Agreement.

 

10.                                 Assignment.  This contract shall be binding upon and inure to the
benefit of the heirs and representatives of Executive and the assigns and
successors of the Company, but neither this Agreement nor any rights or
obligations hereunder shall be assignable or otherwise subject to hypothecation
by Executive (except by will or by operation of the laws of intestate
succession) or by the Company, except that the Company may assign this
Agreement to any successor (whether by merger, purchase or otherwise) to all or
substantially all of the stock, assets or businesses of the Company, if such
successor expressly agrees to assume the obligations of the Company hereunder.

 

11.                                 Amendment.  This Agreement may only be amended by written
agreement of the parties hereto.

 

12.                                 Nondisclosure of
Confidential Information; Non-Competition.

 

(a)  Executive shall not, without the prior written
consent of the Company, use, divulge, disclose or make accessible to any other
person, firm, partnership, corporation or other entity any Confidential
Information pertaining to the business of the Company or any of its affiliates,
except (i) while employed by the Company, in the business of and for the
benefit of the Company, or (ii) as required by law. For

 

 

purposes of this Section 12(a), “Confidential
Information” shall mean non-public information concerning the financial data,
strategic business plans, product development (or other proprietary product
data), customer lists, marketing, acquisition and divestiture plans and other
non-public, proprietary and confidential information of the Company, its
subsidiaries, its theater affiliates (the “Restricted
Group”) or suppliers (including, without limitation, any motion
picture distributor or exhibitor) or vendors, that, in any case, is not
otherwise available to the public (other than by Executive’s breach of the
terms hereof).

 

(b)  During the period of his employment hereunder
and for one year thereafter (except in the case where Executive terminates his
employment with the Company for the Good Reason event described in clause (v) of
the definition of “Good Reason”), Executive agrees that, without the prior
written consent of the Company, (A) he will not, directly or indirectly, either
as principal, manager, agent, consultant, officer, stockholder, partner,
investor, lender or employee or in any other capacity, carry on, be engaged in
or have any financial interest in, any business in Competition (as defined in Section
12(c)) with the business of the Restricted Group and (B) he shall not, on his
own behalf or on behalf of any person, firm or company, directly or indirectly,
solicit or hire for the benefit of anyone, other than the Restricted Group, any
person who is, or was at any time during the six (6) months immediately
preceding the time of the solicitation or hiring by Executive employed by the
Restricted Group (other than Executive’s secretary or other administrative
employee who worked directly for him).

 

(c)  For purposes of this Section 12, a business
shall be deemed to be in “Competition” with the Restricted Group if it operates
any first-run movie theater with a minimum of six (6) screens within ten (10) miles
of any first-run movie theater with a minimum of six (6) screens operated by a
member of the Restricted Group. Nothing in this Section 12 shall be construed
so as to preclude Executive from investing in any publicly or privately held
company, provided Executive’s beneficial ownership of any class of such company’s
securities does not exceed 1% of the outstanding securities of such class.

 

(d)  Executive and the Company agree that this
covenant not to compete is a reasonable covenant under the circumstances, and
further agree that if in the opinion of any court of competent jurisdiction
such restraint is not reasonable in any respect, such court shall have the
right, power and authority to excise or modify such provision or provisions of
this covenant as to the court shall appear not reasonable and to enforce the
remainder of the covenant as so amended. Executive agrees that any breach of
the covenants contained in this Section 12 would irreparably injure the
Company. Accordingly, Executive agrees that the Company may, in addition to
pursuing any other remedies it may have in law or in equity, obtain an
injunction against Executive from any court having jurisdiction over the matter
restraining any further violation of this Agreement by Executive and cease
making any payments otherwise required by this Agreement; provided, however,
that in the event a court of competent jurisdiction, which recognizes the
validity of the provisions of this Section 12, finds Executive not to be in
violation of the provisions of this Section 12, then the Company shall pay to
Executive, in a lump sum, within ten days of such determination, all amounts
that would have been payable to Executive hereunder through the date of such
determination and continue making any other payments due with respect to
periods of time subsequent to such determination in accordance with the
provisions of this Agreement.

 

13.                                 Beneficiaries;
References.  Executive shall be entitled to select
(and change, to the extent permitted under any applicable law) a beneficiary or
beneficiaries to receive any compensation or benefit payable hereunder
following Executive’s death, and may change such election, in either case by
giving the Company written notice thereof. In the event of Executive’s death or
a judicial determination of his incompetence, reference in this Agreement to
Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative, and the Company shall pay amounts payable
under this Agreement, unless otherwise provided herein, in accordance with the
terms of this Agreement, to Executive’s personal or legal representatives,
executors, administrators, heirs, distributees, devisees, legatees or estate,
as the case may be. Any reference to the masculine gender in this Agreement
shall include, where appropriate, the feminine.

 

14.                                 Survival.  The respective rights and obligations of the parties
hereunder shall survive any termination of this Agreement to the extent
necessary to the intended preservation of such rights and obligations. The
provisions of this Section 14 are in addition to the survivorship provisions of
any other section of this Agreement.

 

 

15.                                 Governing Law.  This Agreement shall be construed, interpreted and
governed in accordance with the laws of the state of Tennessee, without
reference to rules relating to conflicts of law.

 

16.                                 Effect on Prior
Agreements.  Except for amendments to this Agreement,
this Agreement contains the entire understanding between the parties hereto and
supersedes in all respects any prior or other agreement or understanding
between the Company or any affiliate of the Company and Executive.

 

17.                                 Withholding.  The Company shall be entitled to withhold all
applicable tax withholdings, FICA, FUTA and all other required withholdings of
the Company from any and all payments made under any provision of this
Agreement.

 

18.                                 Counterparts.  This Agreement may be executed in two or more
counterparts, each of which will be deemed an original.

 

*    *    *    *

 

[Signature Page Follows]

 

 

IN
WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the date set forth in the
first paragraph.

 

 

	
   

  	
  REGAL
  ENTERTAINMENT GROUP

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/
  Amy E. Miles

  
	
   

  	
   

  	
  Name:

  	
  Amy E. Miles

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
  /s/ Peter B. Brandow

  
	
   

  	
  Peter B. Brandow

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