Document:

Exhibit
10.2

NOTE:
THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. PORTIONS OF
THIS DOCUMENT FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED HAVE BEEN
REDACTED AND ARE MARKED HEREIN BY ”[***]”. SUCH REDACTED INFORMATION HAS
BEEN FILED SEPARATELY WITH THE COMMISSION PURSUANT TO THE CONFIDENTIAL
TREATMENT REQUEST.

 

EXHIBITOR SERVICES AGREEMENT

BETWEEN NATIONAL CINEMEDIA, LLC
AND

REGAL CINEMAS, INC.

DATED
AS OF FEBRUARY 13, 2007

 

 

TABLE OF CONTENTS

	
  

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE 1 DEFINITIONS

  	
  1

  
	
   

  	
  Section 1.01

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2 PARTICIPATION AND FEES

  	
  13

  
	
   

  	
  Section 2.01

  	
  Theatre Service Participation

  	
  13

  
	
   

  	
  Section 2.02

  	
  Addition of Theatres

  	
  14

  
	
   

  	
  Section 2.03

  	
  Disposition of Theatres

  	
  15

  
	
   

  	
  Section 2.04

  	
  Mandatory Participation

  	
  15

  
	
   

  	
  Section 2.05

  	
  ESA Modification Payments; Theatre Access Fees

  	
  16

  
	
   

  	
  Section 2.06

  	
  Non-Cash Consideration

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3 EQUIPMENT

  	
  17

  
	
   

  	
  Section 3.01

  	
  Procurement; Cost; Specifications

  	
  17

  
	
   

  	
  Section 3.02

  	
  Ownership of Equipment

  	
  17

  
	
   

  	
  Section 3.03

  	
  Regal Equipment

  	
  17

  
	
   

  	
  Section 3.04

  	
  Installation

  	
  18

  
	
   

  	
  Section 3.05

  	
  Upgrades and Modifications

  	
  19

  
	
   

  	
  Section 3.06

  	
  Network Integration

  	
  19

  
	
   

  	
  Section 3.07

  	
  Training

  	
  19

  
	
   

  	
  Section 3.08

  	
  Equipment Maintenance Standard

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4 DELIVERY OF THE SERVICE

  	
  20

  
	
   

  	
  Section 4.01

  	
  Content and Distribution of the Digital Content
  Service and Traditional Content Program

  	
  20

  
	
   

  	
  Section 4.02

  	
  Delivery of Lobby Promotions, Digital
  Programming Services and Meeting Services

  	
  21

  
	
   

  	
  Section 4.03

  	
  Content Standards

  	
  22

  
	
   

  	
  Section 4.04

  	
  Development of the Service

  	
  23

  
	
   

  	
  Section 4.05

  	
  Brand; Policy Trailer; Branded Slots

  	
  24

  
	
   

  	
  Section 4.06

  	
  Beverage and Legacy Agreements

  	
  25

  
	
   

  	
  Section 4.07

  	
  Other Regal Advertising Agreements

  	
  26

  
	
   

  	
  Section 4.08

  	
  Regal Run-Out Obligations

  	
  27

  
	
   

  	
  Section 4.09

  	
  License

  	
  28

  
	
   

  	
  Section 4.10

  	
  Cooperation and Assistance

  	
  29

  
	
   

  	
  Section 4.11

  	
  Trailers

  	
  30

  
	
   

  	
  Section 4.12

  	
  Customer Access to Pre-Feature Program

  	
  30

  
	
   

  	
  Section 4.13

  	
  Excluded Theatres; IMAX Screens

  	
  30

  
	
   

  	
  Section 4.14

  	
  Grand Openings; Popcorn Tubs; Employee Uniforms

  	
  31

  
	
   

  	
  Section 4.15

  	
  Consultation regarding Certain Advertising
  Agreements

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5 SUPPORT; MAKE GOODS

  	
  32

  
	
   

  	
  Section 5.01

  	
  Software Support

  	
  32

  

 

 i
 

 

	
  

  	
  Section 5.02

  	
  Cooperation

  	
  33

  
	
   

  	
  Section 5.03

  	
  Make Goods

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6 DIGITAL PROGRAMMING SERVICES AND
  MEETING SERVICES

  	
  33

  
	
   

  	
  Section 6.01

  	
  Participation in Digital Programming

  	
  33

  
	
   

  	
  Section 6.02

  	
  Participation in Meeting Services

  	
  33

  
	
   

  	
  Section 6.03

  	
  Marketing and Promotion of Digital Programming
  Services and Meeting Services

  	
  33

  
	
   

  	
  Section 6.04

  	
  Concessions, Sponsorships

  	
  34

  
	
   

  	
  Section 6.05

  	
  LLC’s First Right

  	
  34

  
	
   

  	
  Section 6.06

  	
  Digital Programming Content

  	
  34

  
	
   

  	
  Section 6.07

  	
  Use of Digital Content Network

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 7 INTELLECTUAL PROPERTY

  	
  35

  
	
   

  	
  Section 7.01

  	
  Software License

  	
  35

  
	
   

  	
  Section 7.02

  	
  License of the LLC Marks

  	
  35

  
	
   

  	
  Section 7.03

  	
  License of the Regal Marks

  	
  36

  
	
   

  	
  Section 7.04

  	
  Status of the LLC Marks and Regal Marks

  	
  38

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8 FEES

  	
  38

  
	
   

  	
  Section 8.01

  	
  Payment

  	
  38

  
	
   

  	
  Section 8.02

  	
  Audit

  	
  38

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9 TERM AND TERMINATION

  	
  39

  
	
   

  	
  Section 9.01

  	
  Term

  	
  39

  
	
   

  	
  Section 9.02

  	
  Termination; Defaults

  	
  40

  
	
   

  	
  Section 9.03

  	
  Right of First Refusal

  	
  41

  
	
   

  	
  Section 9.04

  	
  Survival

  	
  42

  
	
   

  	
  Section 9.05

  	
  Effect of Termination

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10 REPRESENTATIONS, WARRANTIES AND
  COVENANTS

  	
  43

  
	
   

  	
  Section 10.01

  	
  Representations and Warranties

  	
  43

  
	
   

  	
  Section 10.02

  	
  Additional Covenants

  	
  44

  
	
   

  	
  Section 10.03

  	
  Disclaimer

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11 INDEMNIFICATION

  	
  45

  
	
   

  	
  Section 11.01

  	
  Indemnification

  	
  45

  
	
   

  	
  Section 11.02

  	
  Defense of Action

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12 ADDITIONAL RIGHTS AND OBLIGATIONS

  	
  46

  
	
   

  	
  Section 12.01

  	
  Assistance

  	
  46

  
	
   

  	
  Section 12.02

  	
  Infringement

  	
  47

  
	
   

  	
  Section 12.03

  	
  Theatre Passes

  	
  47

  
	
   

  	
  Section 12.04

  	
  Compliance with Law

  	
  47

  
	
   

  	
  Section 12.05

  	
  Insurance

  	
  47

  
	
   

  	
  Section 12.06

  	
  Most Favored Nations

  	
  47

  
	
   

  	
  Section 12.07

  	
  Non-Competition and Non-Solicitation

  	
  48

  

 

 ii
 

 

	
  ARTICLE 13 OWNERSHIP

  	
  48

  
	
   

  	
  Section 13.01

  	
  Property

  	
  48

  
	
   

  	
  Section 13.02

  	
  Derived Works

  	
  49

  
	
   

  	
  Section 13.03

  	
  No Title

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 14 CONFIDENTIALITY

  	
  50

  
	
   

  	
  Section 14.01

  	
  Confidential Treatment

  	
  50

  
	
   

  	
  Section 14.02

  	
  Injunctive Relief

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 15 MISCELLANEOUS

  	
  51

  
	
   

  	
  Section 15.01

  	
  Notices

  	
  51

  
	
   

  	
  Section 15.02

  	
  Waiver; Remedies

  	
  52

  
	
   

  	
  Section 15.03

  	
  Severability

  	
  52

  
	
   

  	
  Section 15.04

  	
  Integration; Headings

  	
  52

  
	
   

  	
  Section 15.05

  	
  Construction

  	
  52

  
	
   

  	
  Section 15.06

  	
  Non-Recourse

  	
  52

  
	
   

  	
  Section 15.07

  	
  Governing Law; Submission to Jurisdiction

  	
  53

  
	
   

  	
  Section 15.08

  	
  Assignment

  	
  54

  
	
   

  	
  Section 15.09

  	
  Force Majeure

  	
  54

  
	
   

  	
  Section 15.10

  	
  Third Party Beneficiary

  	
  54

  
	
   

  	
  Section 15.11

  	
  Export

  	
  54

  
	
   

  	
  Section 15.12

  	
  Independent Contractors

  	
  55

  
	
   

  	
  Section 15.13

  	
  Counterparts

  	
  55

  

 

EXHIBITS AND SCHEDULE

	
  

  	
  Exhibit A

  	
  Description of Advertising Services and Digital
  Programming Services

  
	
   

  	
  Exhibit A-1

  	
  Inventory of Lobby Promotions

  
	
   

  	
  Exhibit B

  	
  Creative Services, Beverage Agreement Advertising
  Rate, Digital Programming Services, Administrative Fee

  
	
   

  	
  Exhibit B-1

  	
  Terms regarding Meeting Services

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 1

  	
  Calculation of Exhibitor Allocation, Theatre Access
  Fee and Run-Out Obligations

  

 

 iii

EXHIBITOR SERVICES AGREEMENT

THIS EXHIBITOR SERVICES AGREEMENT (this “Agreement”)
is entered into and effective as of February 13, 2007 (the “Effective Date”) by
and between National CineMedia, LLC, a Delaware limited liability company (“LLC”),
and Regal Cinemas, Inc., a Tennessee corporation (“Regal,” and with LLC, each a
“Party” and collectively, the “Parties”).

BACKGROUND

WHEREAS, American Multi-Cinema, Inc. (“AMC”), Regal
CineMedia Holdings, LLC (“RCH”) and Cinemark Media, Inc. (“Cinemark Media”),
are parties to that certain Third Amended and Restated Limited Liability
Company Operating Agreement, dated of even date herewith (the “LLC Agreement”),
which shall govern the rights and obligations of AMC, RCH and Cinemark Media
(collectively, the “Founding Members”) and National CineMedia, Inc. (“National
CineMedia”) as Members in LLC and their ownership of certain Common Units (as
defined in the LLC Agreement) in LLC; and

WHEREAS, pursuant to the LLC Agreement, LLC will
operate a Digital Content Network (as defined below), which has the
capabilities to provide the Founding Members the Digital Content Service, the
Digital Programming Services and the Meeting Services (each as defined below)
pursuant to the terms and conditions herein; and

WHEREAS, Regal participates in the Digital Content
Network through its Theatres; and

WHEREAS, LLC and Regal desire to enter into a service
arrangement pursuant to which LLC will provide the Advertising Services (as
defined below), including the Digital Content Service and the Traditional
Content Program, the Digital Programming Services and the Meeting Services to
Regal theatres, and Regal will accept the Advertising Services, the Digital
Programming Services and the Meeting Services in such theatres, all on the
terms and conditions set forth herein; and

WHEREAS, LLC and Regal anticipate that this service
arrangement will, among other accomplishments, improve both the movie-going
experience of theatre patrons and the ability of national, regional and local
advertisers to reach their target consumers.

NOW, THEREFORE, in consideration of the premises and
mutual covenants in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby expressly
acknowledged, and, intending to be legally bound hereby, the Parties hereto
agree as follows:

ARTICLE
1

DEFINITIONS

Section 1.01         Definitions.  Within the context of this Agreement, the
following terms shall have the following meanings:

“4.03 Revenue”
has the meaning assigned to it in Section 4.03.

“Acceptance Notice”
has the meaning assigned to it in Section 9.03(c).

“Acquisition
Theatre(s)” has the meaning assigned to it in Section 2.02(b).

“Additional Lobby
Promotion” has the meaning assigned to it in Section 4.02(a)(i).

“Administrative
Agent” means Lehman Commercial Paper Inc., as administrative agent
under the LLC Credit Agreement and any successors and assignees in accordance
with the terms of the LLC Credit Agreement.

“Administrative Fee”
means the fee for services provided by LLC as requested by Regal in connection
with delivery of content to Theatres.

“Advertising
Services” means the advertising and promotional services (including
the Digital Content Service, the Digital Carousel, the Traditional Content
Program, Lobby Promotions and Event Sponsorships) as described in Part A
of Exhibit A hereto.

“Affiliate”
means with respect to any Person, any Person that directly or indirectly,
through one or more intermediaries Controls, is Controlled by or is under
common Control with such Person.  Notwithstanding
the foregoing, (i) no Member shall be deemed an Affiliate of LLC,
(ii) LLC shall not be deemed an Affiliate of any Member, (iii) no
stockholder of REG, or any of such stockholder’s Affiliates (other than REG and
its Subsidiaries) shall be deemed an Affiliate of any Member or LLC,
(iv) no stockholder of Marquee Holdings, or any of such stockholder’s
Affiliates (other than Marquee Holdings and its Subsidiaries) shall be deemed
an Affiliate of any Member or LLC, (v) no stockholder of Cinemark Holdings,
or any of such stockholder’s Affiliates (other than Cinemark Holdings and its
Subsidiaries) shall be deemed an Affiliate of any Member or LLC, (vi) no
stockholder of National CineMedia shall be deemed an Affiliate of National
CineMedia, and (vii) National CineMedia shall not be deemed an Affiliate
of any stockholder of National CineMedia.

“Aggregate
Advertising Revenue” means, for the applicable measurement period,
the total revenue, in the form of cash and non-cash consideration, payable to
LLC for Advertising Services, excluding revenue payable to LLC related to (i)
Event Sponsorship, (ii) Advertising Services provided to third parties that are
not Founding Members, and (iii) Advertising Services provided to Founding
Members outside the provisions of this Agreement pursuant to a written
agreement between LLC and such Founding Members.

“Agreement”
has the meaning assigned to it in the preamble of this Agreement, as the same
may be amended, supplemented or otherwise modified from time to time.

“Alternative
Agreement” has the meaning assigned to it in Section 9.03(a).

“AMC” has
the meaning assigned to it in the recitals to this Agreement.

“AMC Exhibitor
Agreement” means the Exhibitor Services Agreement between LLC and
AMC, dated of even date herewith, as the same may be amended, supplemented or
otherwise modified from time to time.

 2
 

“AMC Theatre” means
any “Theatre” as defined in the AMC Exhibitor Agreement.

“Assignment and Assumption”
has the meaning assigned to it in Section 15.08.

“Bankruptcy Code”
means Title 11 of the United States Code (11 U.S.C. §101 et seq.), as amended
from time to time.

“Beverage Agreement”
means the Marketing, Advertising and Brand Presence Agreement by and between
Coca-Cola North America, a division of The Coca-Cola Company, and Regal, dated
as of October, 2001, and all exhibits and amendments thereto, as such agreement may be amended from
time to time, and any subsequent agreements entered into by Regal and its
beverage concessionaires at the expiration or termination of the agreement
referenced above which is in effect on the Effective Date.

“Beverage Agreement
Advertising Rate” has the meaning assigned to it in
Section 4.06(a).

“Beverage Compliance
Report” has the meaning assigned to it in Section 4.10(b)(i).

“Brand”
has the meaning assigned to it in Section 4.05.

“Branded Slots”
has the meaning assigned to it in Section 4.05.

“Church Worship Service”
means a Meeting Event sold to a non-profit religious organization.

“Cinemark” means Cinemark USA, Inc., a Texas
corporation.

“Cinemark Exhibitor
Agreement” means the Exhibitor Services Agreement between LLC and
Cinemark, dated of even date herewith, as the same may be amended, supplemented
or otherwise modified from time to time.

“Cinemark Holdings”
means Cinemark Holdings, Inc. or its successor or any Person that wholly owns
Cinemark Holdings, directly or indirectly, in the future.

“Cinemark Media”
has the meaning assigned to it in the recitals to this Agreement.

“Cinemark Theatre”
means any “Theatre” as defined in the Cinemark Exhibitor Agreement.

“Client Limitation”
has the meaning assigned to it in Section 4.07(b)(i).

“Common Unit Adjustment”
has the meaning assigned to it in the LLC Agreement.

“Common Units” has
the meaning assigned to in the LLC Agreement.

“Concessions”
means popcorn, candy, and other food and beverage items sold at the concession
stands in Theatres.

 3
 

“Confidential
Information” means all documents and information concerning any
other Party hereto furnished it by such other Party or its representatives in
connection with the transactions contemplated by this Agreement (together with
confidential information, including but not limited to Intellectual Property
and other Proprietary Information of the other Members and LLC), and shall
include, by way of example and not limitation, the LLC Property, the Regal
Property, the LLC Derived Works and the Regal Derived Works.  Confidential Information shall also include
all Confidential Information supplied by the Members and their Affiliates.  Notwithstanding the foregoing, Confidential
Information shall not include any information that can be shown to have been
(i) previously known by the Party to which it is furnished lawfully and
without breaching or having breached an obligation of such Party or the
disclosing Party to keep such documents and information confidential,
(ii) in the public domain through no fault of the disclosing Party, or
(iii) independently developed by the disclosing Party without using or
having used the Confidential Information.

“Control”
(including the terms “Controlled by”
and “under common Control with”),
with respect to the relationship between or among two or more Persons, means
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, as trustee or executor, by contract or
otherwise.

“Costs”  has the meaning assigned to it in
Section 11.01(a).

“CPI”
means the monthly index of the U.S. City Average Consumer Price Index for Urban
Wage Earners and Clerical Workers (All Items; 1982-84 equals 100) published by
the United States Department of Labor, Bureau of Labor Statistics or any
successor agency that shall issue such index. 
In the event that the CPI is discontinued for any reason, LLC shall use
such other index, or comparable statistics, on the cost of living for urban
areas of the United States, as shall be computed and published by any agency of
the United States or, if no such index is published by any agency of the United
States, by a responsible financial periodical of recognized authority.

“CPI Adjustment”
means the quotient of (i) the CPI for the month of January in the calendar year
for which the CPI Adjustment is being determined, divided by (ii) the CPI for
January of 2007.

“Creative Services”
has the meaning assigned to it in Exhibit B.

“Designated Services”
has the meaning assigned to it in Section 9.03(a).

“Digital Carousel”
means a loop of slide advertising with minimal branding and entertainment
content which (i) is displayed before the Pre-Feature Program in Digitized
Theatres via the Digital Content Network and (ii) is displayed before the
Traditional Content Program in Non-Digitized Theatres via a non-digital slide
projector.

“Digital Cinema
Services” means services related to the digital playback and display
of feature films at a level of quality commensurate with that of 35 mm
film release prints that includes high-resolution film scanners, digital image
compression, high-speed data networking and storage, and advanced digital
projection.

 4
 

“Digital Content
Network” means a network of LLC Equipment and third-party equipment
and other facilities which provides for the electronic transmission of digital
content, directly or indirectly,
from a centrally-controlled location to Theatres, resulting in the “on-screen”
exhibition of such content in such Theatres, either in Theatre auditoriums or
on Lobby Screens.

“Digital Content
Service” means the Pre-Feature Program, Policy Trailer, Event
Trailer and the Video Display Program.

“Digital Event Peak
Season” has the meaning assigned to it in Exhibit B.

“Digital Films”
has the meaning assigned to it in Exhibit B.

“Digital Programming”
means the content of Digital Programming Services.

“Digital Programming EBITDA Threshold”
has the meaning assigned to it in Section 9.01(b).

“Digital Programming Renewal Term”
has the meaning assigned to it in Section 9.01(b).

“Digital Programming
Services” has the meaning assigned to it in Part B of Exhibit B.

“Digital Programming Term”
has the meaning assigned to it in Section 9.01(b).

“Digital Screen”
means a screen in an auditorium of a Digitized Theatre.

“Digitized Theatres”
means all Theatres that are connected to the Digital Content Network, as of the
Effective Date, and all Theatres that subsequently connect to the Digital
Content Network, as of the date such connection is established.

“Disposition”
(including the term “Disposed”)
has the meaning assigned to it in Section 2.03.

“EBITDA”  means, for the applicable measurement
period, earnings before interest, taxes, depreciation and amortization, all as
defined by GAAP.

“Effective Date”
has the meaning assigned to it in the preamble of this Agreement.

“Encumbered Theatres”
has the meaning assigned to it in Section 4.08(a).

“Equipment”
means the equipment and cabling, as prescribed by the terms of this Agreement,
which is necessary to schedule, distribute, play, reconcile and otherwise
transmit and receive the Services delivered by LLC pursuant to the terms of
this Agreement, and a complete list of all such equipment located inside or on
any Theatre building and the ownership thereof as of the date hereof is set
forth in the Specification Documentation, as may be amended from time to time
at the request of either Party.

 5
 

“ESA-Related Tax
Benefit Payments” has the meaning assigned to it in Section 1.1 of
the Tax Receivable Agreement.

“Event Sponsorship”
has the meaning assigned to it in Part A of Exhibit A.

“Event Trailer”
has the meaning assigned to it in Section 6.03(a).

“Excluded Theatres”
has the meaning assigned to it in Section 4.13(a).

“Flight” has the meaning assigned to it in
Section 4.01(a).

“Founding Members”
has the meaning assigned to it in the recitals to this Agreement and shall
include their respective Affiliates.

“Future Theatres”
has the meaning assigned to it in Section 3.01.

“GAAP”
means United States generally accepted accounting principles, consistently
applied.

“Governmental
Authority” means any nation or government, any state or other
political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

“Group”
has the meaning used in Section 13(d) and 14(d) of the Securities Exchange
Act of 1934.

“IMAX Screens”
has the meaning assigned to it in Section 4.13(b).

“Indemnifying Party”
has the meaning assigned to it in Section 11.01(c).

“Infringement”
has the meaning assigned to it in Section 12.02.

“Initial Digital Programming Term”
has the meaning assigned to it in Section 9.01(b).

“Initial Meeting Services Term”
has the meaning assigned to it in Section 9.01(c).

“Initial Term”
has the meaning assigned to it in Section 9.01(a).

“Intellectual
Property” means all intellectual property, including but not limited
to all U.S., state and foreign (i) (A) patents, inventions,
discoveries, processes and designs; (B) copyrights and works of authorship
in any media; (C) trademarks, service marks, trade names, trade dress and
other source indicators and the goodwill of the business symbolized thereby,
(D) software; and (E) trade secrets and other confidential or
proprietary documents, ideas, plans and information; (ii) registrations,
applications and recordings related thereto; (iii) rights to obtain
renewals, extensions, continuations or similar legal protections related
thereto; and (iv) rights to bring an action at law or in equity for the
infringement or other impairment thereof.

“Inventory” means any advertising or other
content.

 6
 

“License Agreement”
means that certain Second Amended and Restated Software License Agreement,
dated of even date herewith, among LLC, AMC, Cinemark and Regal, as applicable,
and as such agreement may be amended, supplemented or otherwise modified from
time to time.

“LLC Agreement”
has the meaning assigned to it in the recitals to this Agreement.

“LLC Credit
Agreement” means the Credit Agreement dated as of February 13, 2007
among LLC, the several lenders from time to time parties thereto, JPMorgan
Chase Bank, N.A., as syndication agent, Credit Suisse (USA) LLC and Morgan
Stanley Senior Funding, Inc., as co-documentation agents and the Administrative
Agent, as amended, modified or supplemented from time to time and any
extension, refunding, refinancing or replacement (in whole or in part) thereof.

“LLC Derived Works”
has the meaning assigned to it in Section 13.02(a).

“LLC Equipment”
means the Equipment owned by LLC pursuant to the terms of this Agreement.

“LLC Marks”
means the trademarks, service marks, logos, slogans and/or designs owned by LLC
or otherwise contributed by LLC for use under this Agreement, in any and all
forms, formats and styles, including as may be used in the Brand (as defined
herein), as may be modified from time-to-time all as notified to Regal from
time to time by LLC.

“LLC Property”
has the meaning assigned to it in Section 13.01(a).

“LLC Quality
Standards” has the meaning assigned to it in Section 7.02(c).

“Lobby Promotions”
has the meaning assigned to it in Part A of Exhibit A.

“Lobby Screen”
means a plasma, LED or other type of screen displaying digital or recorded
content that is located inside a Theatre and outside the auditoriums, or any
other type of visual display mechanism that replaces such a screen.  Lobby Screens shall not include, however,
digital poster cases, digital animated poster cases, ATM or ticket kiosk screens (or such items that may replace
digital poster cases or ATM or ticket kiosk screens in the future) or other
substantially similar display mechanisms that display Theatre Advertising or
promotional material that may include some or all of the following types of
content: isolated images or still scenes from feature films, full motion
elements that are not a movie trailer, interactive elements, audio elements and
motion sensors and which content, considered singularly and collectively, is sufficiently
limited in playtime and complexity such that it cannot reasonably be considered
equivalent to a movie trailer.

“Loews Theatres”
mean the theatres acquired (and not divested under government order) by AMC
Entertainment Inc. in connection with its merger with Loews Cineplex
Entertainment Corporation completed on January 26, 2006.

“Marketing Materials”
has the meaning assigned to it in Section 7.02(a).

 7
 

“Marquee Holdings”
means Marquee Holdings Inc. (a holding company that conducts business through its
subsidiary AMC Entertainment Inc.) or its successor or any Person that wholly
owns Marquee Holdings, directly or indirectly, in the future.

“Meeting Services”
has the meaning assigned to it in Part C of Exhibit A.

“Meeting Services EBITDA Threshold”
has the meaning assigned to it in Section 9.01(c).

“Meeting Services Renewal Term”
has the meaning assigned to it in Section 9.01(c).

“Meeting Services Term”
has the meaning assigned to it in Section 9.01(c).

“Meeting With a Movie”
means a Meeting Services event at which a feature film is shown and for which
tickets are sold.

“Meeting Without a Movie”
means a Meeting Services event at which no feature film is shown.

“Member”
means each Person that becomes a member, as contemplated in the Delaware
Limited Liability Act, of LLC in accordance with the provisions of the LLC
Agreement and has not ceased to be a Member pursuant to the LLC Agreement.

“National CineMedia”
has the meaning assigned to it in the recitals to this Agreement.

“Newbuild Theatre(s)”
has the meaning assigned to it in Section 2.02(a).

“Non-Assignable
Legacy Agreement” has the meaning assigned to it in
Section 4.06(b)(ii).

“Non-Digitized
Theatres” means Theatres that are not Digitized Theatres.

“Party”
has the meaning assigned to it in the preamble of this Agreement.

“Permitted Transfer”
means:

(a)           by
operation of law or otherwise, the direct or indirect change in control,
merger, consolidation or acquisition of all or substantially all of the assets
of LLC or Regal, as applicable, or the assignment of this Agreement by Circuit
A to an Affiliate,

(b)           with
respect to the rights and obligations of LLC under this Agreement, (i) the
grant of a security interest by LLC in this Agreement and all rights and
obligations of LLC hereunder to the Administrative Agent, on behalf of the
Secured Parties, pursuant to the Security Documents, (ii) the assignment or
other transfer of such rights and obligations to the Administrative Agent (on
behalf of the Secured Parties) or other third party upon the exercise of remedies
in accordance with the LLC Credit Agreement and the Security Documents and
(iii) in the event that the Administrative Agent is the initial assignee or
transferee under the preceding clause (ii), the subsequent assignment or other
transfer of such rights and obligations by the

 8
 

Administrative Agent on behalf of the Secured Parties to a third party,
or

(c)           in
the event that LLC becomes a debtor in a case under the Bankruptcy Code, the
assumption and/or assignment by LLC of this Agreement under section 365 of the
Bankruptcy Code, notwithstanding the provisions of section 365(c) thereof.

“Person”
means any individual, corporation, limited liability company, partnership,
trust, joint stock company, business trust, unincorporated association, joint
venture, Governmental Authority or other entity or organization of any nature
whatsoever or any Group of two or more of the foregoing.

“Play List”
has the meaning assigned to it in Section 4.01(a).

“Policy Trailer”
has the meaning assigned to it in Section 4.05(b).

“Pre-Feature Program”
means a program of digital content of between twenty (20) and thirty (30)
minutes in length that is distributed by LLC through the Digital Content
Network for exhibition in Digitized Theatres prior to Showtime, or that is
distributed non-digitally by some other means, including DVD, for exhibition
prior to Showtime in Non-Digitized Theatres.

“Pre-Feature
Programming Schedule” means the schedule for the Pre-Feature Program
as developed from time to time by LLC after consultation with Regal.

“Proprietary
Information” means all Intellectual Property, including but not
limited to information of a technological or business nature, whether written
or oral and if written, however produced or reproduced, received by or
otherwise disclosed to the receiving Party from or by the disclosing Party that
is marked proprietary or confidential or bears a marking of like import, or
that the disclosing Party states is to be considered proprietary or
confidential, or that a reasonable person would consider proprietary or
confidential under the circumstances of its disclosure.

“PSA Trailer” means
up to 30 seconds for Regal approved fundraising and that may contain the
display of any trademark, service mark, logo or other branding of the
charitable organizations sponsoring such fundraising that is exhibited in the
Theatres after Showtime.

“RCH” has
the meaning assigned to it in the recitals to this Agreement.

“REG”
means Regal Entertainment Group or its successor or any Person that wholly owns
REG, directly or indirectly, in the future.

“Regal”
has the meaning assigned to it in the preamble of this Agreement.

“Regal Derived Works”  has the meaning assigned to it in
Section 13.02(b).

“Regal Equipment”
means the Equipment owned by Regal.

“Regal Information”
means all Confidential Information supplied by
Regal and its Affiliates.

 9
 

“Regal Initial ESA
Modification Payment” has the meaning assigned to it in Section
2.05(a)(i).

“Regal Legacy
Agreement(s)” means all pre-Effective Date agreements of Regal or
its Affiliates, including without limitation such agreements relating to the
purchase of advertising in Acquisition Theatres, pursuant to which services
which fall within the definition of Advertising Services are provided and which
are expected to result in the generation of revenue payable to Regal or its
Affiliates on and after the Effective Date, but excluding the Beverage
Agreement, agreements with third-party cinema advertising service providers
(which give rise to Run-Out Obligations pursuant to Section 4.08) and
agreements between Regal or its Affiliates and any theatres owned by third
parties (including other Members or their Affiliates) regarding the exhibition
of content, advertisements or promotions in such third-party theatres.

“Regal Marks”  means the trademarks, service marks,
logos, slogans and/or designs owned by Regal or otherwise contributed by Regal
for use under this Agreement, in any and all forms, formats and styles,
including as may be used in the Brand (as defined herein), as may be modified
from time-to-time all as notified to LLC from time-to-time by Regal.

“Regal Property”
has the meaning assigned to it in Section 13.01(b).

“Regal Quality
Standards” has the meaning assigned to it in Section 7.03(c).

“Renewal Term”
has the meaning assigned to it in Section 9.01(a).

“Representatives”
has the meaning assigned to it in Section 11.01(a).

“ROFR Notice”
has the meaning assigned to it in Section 9.03(a).

“ROFR Period”
has the meaning assigned to it in Section 9.03(a).

“ROFR Response”
has the meaning assigned to it in Section 9.03(c).

“ROFR Response
Period” has the meaning assigned to it in Section 9.03(c).

“Run-Out Obligations”
has the meaning assigned to it in Section 4.08.

“Secured Parties”
means the “Secured Parties” (or any analogous concept) as defined in the LLC
Credit Agreement.

“Security Documents”
means the “Security Documents” as defined in the LLC Credit Agreement and any
amendment, modification, supplement or replacement of such Security Documents.

“Service” means the
Advertising Services and, for the duration of the Meeting Services Term and the
Digital Programming Term, the Meeting Services and the Digital Programming
Services, respectively, all as set forth on Exhibit A and as
applicable.

“Showtime” means
the advertised showtime for a feature film.

 10
 

“Software”
means the software owned by, and/or licensed to, LLC or its direct or indirect
Subsidiaries and which is installed on either LLC Equipment or Regal Equipment
and used in connection with delivery of the Digital Content Service, the Digital
Carousel, the Digital Programming Services and the Meeting Services.

“Special Promotions”
has the meaning assigned to it in Section 4.14.

“Specification Documentation”
means documentation as specified herein, relating to technical specifications
or other matters relating of this Agreement, that is delivered and agreed upon
by the Parties on the Effective Date of this Agreement.

“Strategic LEN
Promotion” has the meaning assigned to it in
Section 4.07(b)(ii).

“Strategic Lobby
Promotion” has the meaning assigned to it in
Section 4.07(b)(iii).

“Strategic Programs”
has the meaning assigned to it in Section 4.07(b).

“Strategic
Relationship” has the meaning assigned to it in
Section 4.07(b).

“Subsidiary”
means, with respect to any Person, (i) a corporation a majority of whose
capital stock with the general voting power under ordinary circumstances to
vote in the election of directors of such corporation (irrespective of whether
or not, at the time, any other class or classes of securities shall have, or
might have, voting power by reason of the happening of any contingency) is at
the time beneficially owned by such Person, by one or more Subsidiaries of such
Person or by such Person and one or more Subsidiaries thereof or (ii) any
other Person (other than a corporation), including a joint venture, a general
or limited partnership or a limited liability company, in which such Person,
one or more Subsidiaries thereof or such Person and one or more Subsidiaries
thereof, directly or indirectly, at the date of determination thereof,
beneficially own a majority ownership interest entitled to vote in the election
of directors, managers or trustees thereof (or other Persons performing such
functions) or act as the general partner or managing member of such other
Person.

“Supplemental
Theatre Access Fee” has the meaning assigned to it in
Schedule 1.

“Tax Receivable Agreement” means that
certain Tax Receivable Agreement by and among National CineMedia, LLC, RCH,
AMC, Cinemark Media, Cinemark, and Regal, and to be dated as of the date
hereof.

“Term” has the meaning assigned to it in
Section 9.01(a).

“Territory”
means the 50 states of the United States of America and the District of
Columbia.

“Theatre Access Fee”
has the meaning assigned to it in Schedule 1.

“Theatre Advertising”
means advertisement of one or more of the following activities associated with
operation of the Theatres of Regal or its Affiliates:  (A) Concessions or Concession
promotions, (B) Regal’s gift cards, loyalty programs and other items
related to

 11
 

Regal’s business in the
Theatres, (C) events presented by Regal pursuant to Section 6.05, or
(D) vendors of services (other than film-related vendors) provided to the
Theatres, provided such promotion is incidental to the vendor’s service such
as, but without limitation, online or telephone ticketing or other alternative
delivery sources for the same, credit cards, bank cards, charge cards, debit
cards, gift cards and other consumer payment devices.  Theatre Advertising includes the display of
concession menus, movie listings, Showtimes and pricing information.

“Theatres”
means from time-to-time, as applicable, all theatres in the Territory owned by
Regal or an Affiliate of Regal or as to which Regal or an Affiliate of Regal
has a controlling interest or operational control, including both Digitized and
Non-Digitized Theatres, except as provided in Sections 2.02(b), 4.08 and
4.13 or as may be mutually agreed by the Parties in writing.  The foregoing notwithstanding, no motion
picture theatre located outside of the Territory shall be a Theatre without LLC’s
prior written consent.  Theatre includes
all parts of the physical facilities inside a theatre building to which the
public has access.

“Third
Party Theatre Agreement” means an agreement between LLC
and a third party that gives LLC a right to provide Advertising Services with
respect to the Theatres being Disposed of by a Founding Member to such third
party and that meets the following minimum requirements:  (i) the third party grants LLC exclusive
access to and the exclusive right to provide Advertising Services with respect
to the Theatres; (ii) the Third Party Theatre Agreement incorporates content
standards no more restrictive than as set forth in section 4.03 of this
Agreement; (iii) the fee payable by LLC to the third party for the Advertising
Services does not exceed [***] of LLC’s total revenue attributable to such
Advertising Services; (iv) the term of the Third Party Theatre Agreement
(excluding extensions) is for the shorter of (A) the term of the longest
lease (excluding extensions) being Disposed of by the Founding Member in the
transaction, or (B) [***]; (v) LLC has substantially similar penalties
upon a breach of the Third Party Theatre Agreement by such third party than as
set forth in this Agreement for breaches by such Founding Member; and (vi) in
all other material respects, the Third Party Theatre Agreement imposes
obligations upon the third party that are substantially similar to the
obligations imposed upon the Founding Member in this Agreement, except that
obligations arising exclusively from such Founding Member’s status as a
Founding Member shall be inapplicable to the third party.

“Traditional Content
Program” means advertising and other promotional content which is
displayed on 35 mm film prior to Showtime.

“Trailer”
means a promotion secured by Regal or its designee (which retains the exclusive
rights to so secure for all of its Theatres) for a feature film that is
exhibited in the Theatres after Showtime.

“Unit Adjustment
Agreement” means that certain Common Unit Adjustment Agreement of
even date herewith among National CineMedia, LLC, RCH, AMC, Cinemark Media,
Cinemark, and Regal, and to be dated as of the date hereof.

“Upgrade Request”
has the meaning assigned to it in Section 3.05.

 12
 

“Video Display
Program” means a program of digital content shown on Lobby Screens
which is distributed by LLC through the Digital Content Network for exhibition
in Digitized Theatres, and which is distributed non-digitally by some other
means, including DVD, for exhibition in Non-Digitized Theatres.

ARTICLE
2

PARTICIPATION
AND FEES

Section 2.01         Theatre
Service Participation.  From the Effective Date and during the Term,
LLC shall provide all aspects of the Service to Regal and Regal shall exhibit
and otherwise participate in such aspects of the Service, on the terms and
conditions set forth herein.  Subject to
the provisions of Section 4.08 (Regal Run-Out Obligations), during the
Term all Theatres will participate in the Service either as Digitized Theatres
or Non-Digitized Theatres.

(a)           Digitized
Theatres.  As of the Effective Date
and during the Term, pursuant to the terms of Section 4.01 (Content and
Distribution of the Digital Content Service and Traditional Content Program),
LLC will provide the following Services to the Digitized Theatres, and all
Digitized Theatres will, subject to the terms of Section 4.12 (Access to
Pre-Feature Program), participate in (i) the Digital Carousel during the
period beginning after the preceding feature film (or, in the case of the first
feature film of the day, beginning after the opening of the auditorium doors
for that film) until the beginning of the Pre-Feature Program, (ii) the
Pre-Feature Program, (iii) the Policy Trailer and (iv) the Video
Display Program.

(b)           Non-Digitized
Theatres.  As of the Effective Date
and during the Term, pursuant to the terms of Section 4.01 (Content and
Distribution of the Digital Content Service and Traditional Content Program),
LLC will provide the following Services to the Non-Digitized Theatres, and all
Non-Digitized Theatres will, subject to the terms of Section 4.12 (Access to
Pre-Feature Program), participate in, (i) the Digital Carousel during the
period beginning after the preceding feature film (or, in the case of the first
feature film of the day, beginning after the opening of the auditorium doors
for that film) until the beginning of the Traditional Content Program,
(ii) the Traditional Content Program, (iii) the Policy Trailer and
(iv) the Video Display Program, but with respect to participation of
Non-Digitized Theatre’s participation in the Video Display Program, only to the
extent that a Non-Digitized Theatre has at least one Lobby Screen and has the
requisite equipment necessary to participate in the Video Display Program.  No Non-Digitized Theatre will be obligated to
participate in, nor will LLC be obligated to provide to any Non-Digitized
Theatre, the Pre-Feature Program.

(c)           Lobby
Promotions.  LLC shall provide Lobby
Promotions to Theatres and Theatres shall participate in Lobby Promotions as
described in Section 4.02.

(d)           Events
and Meetings.  LLC shall provide
Digital Programming Services (including Event Trailers) and Meeting Services to
Theatres and Theaters shall participate in Digital Programming and Meeting
Services as described in Article 6.

(e)           Modifications.  The Parties agree that the rights and
obligations to provide and participate in elements of the Service, as set forth
immediately above, may be modified

 13
 

during the Term upon mutual written agreement of the Parties.

(f)            Conversion
of Theatres.  No Digitized Theatre
shall become a Non-Digitized Theatre without the mutual agreement of Regal and
LLC.  Regal will determine from time to
time which Non-Digitized Theatres will be converted to Digitized Theatres.

(g)           Rights
to Transfer Theatres.  The Parties
agree that nothing in this Agreement is intended to, nor shall, bind or
otherwise limit Regal’s or its Affiliates’ rights and abilities in its sole
discretion from time to time to close, sell, acquire or otherwise transfer any interest
in (including by mortgage or otherwise) any theatre.

Section 2.02         Addition
of Theatres

.(a)          Newbuild Theatres.  Except as provided in Section 4.13
(Excluded Theatres; IMAX Screens) or as mutually agreed by the Parties in
writing, any theatre in the Territory newly built by Regal or an Affiliate of
Regal following the Effective Date (“Newbuild Theatres”) shall be equipped to
receive the Digital Content Service via the Digital Content Network, shall be a
Digitized Theatre, and shall participate in the Digital Content Service on the
terms set forth in Section 2.01. 
LLC agrees to provide all aspects of the Service to Newbuild Theatres on
the terms and conditions set forth herein.

(b)           Acquisition
Theatres.  Any theatre in the
Territory of which Regal or an Affiliate of Regal obtains control of the
advertising, promotional or event activities therein after the Effective Date
(excluding any Newbuild Theatres and any Loews Theatre) shall be an “Acquisition
Theatre(s)”.  Subject to
Sections 4.08 and 4.13, LLC shall provide all aspects of the Service to
such Acquisition Theatres and Regal shall cause such Acquisition Theatres to
exhibit and participate in the Service on the terms and conditions set forth
herein.  The Parties agree that Regal may
obtain operational control of an Acquisition Theatre but not obtain any or all
rights necessary to receive or display any or all aspects of the Service or
control over advertising, promotions or events but not over all of the
foregoing, and, in such circumstances Regal shall use its commercially
reasonable efforts to have as much of the Service received or displayed in such
Acquisition Theatres as is within its control, or if not, then as reasonably
practicable.  The Parties agree that it
may not be commercially reasonable to equip each Acquisition Theatre to receive
the Digital Content Service and the Digital Programming Services and Meeting
Services via the Digital Content Network. 
Therefore, the Parties agree, subject to Sections 4.08 and 4.13,
that every Acquisition Theatre that is a Digitized Theatre shall participate in
the Digital Content Service via the Digital Content Network on the terms set
forth in Section 2.01, but that Regal retains sole discretion as to if,
when and which Acquisition Theatres Regal converts to Digitized Theatres.  Upon Regal’s decision to convert an
Acquisition Theatre to a Digitized Theatre, the Parties agree to discuss in
good faith the appropriate schedule for equipping such Acquisition Theatre to
receive the Digital Content Service, the Digital Programming Services and
Meeting Services via the Digital Content Network.  Upon agreeing upon the schedule to conduct
such equipping, LLC shall diligently prosecute such work until completion.

(c)           Common
Unit Adjustment.  Any adjustment of
Common Unit ownership by the Members related to Newbuild Theatres and
Acquisition Theatres shall be addressed in the Unit Adjustment Agreement.

 14
 

Section 2.03         Disposition
of Theatres.

(a)           Disposition.  Regal shall provide LLC prompt written notice
after the sale, transfer, permanent closure or other disposition of a Theatre
(other than as the result of a Permitted Transfer) or the permanent loss of any
Theatre lease (a “Disposition”).  The
decision to sell, close or otherwise dispose of any Theatre shall be in Regal’s
sole and absolute discretion.  Any such
Theatre shall cease to be a Theatre for all purposes under this Agreement; and,
if so determined by Regal and agreed by LLC (which agreement shall not be
unreasonably or untimely withheld), then unless LLC and the applicable third
party(ies) enter into a Third Party Theatre Agreement, then the Parties will
agree on a date and time at which LLC shall be permitted to enter the affected
Theatre(s) and remove any LLC Property (as defined in Section 13.01).  In the event LLC fails to remove any LLC
Property within the timeframe the Parties agree upon for such removal, Regal or
such third party transferee shall have the right to remove and dispose of such
LLC Property in its sole discretion; provided that any Software included
in the LLC Property shall be removed and returned to LLC at LLC’s expense.

(b)           Common
Unit Adjustment.  Any adjustment of
Common Unit ownership by the Members related to Disposition of Theatres shall
be addressed in the Unit Adjustment Agreement.

Section 2.04         Mandatory
Participation. 
During the Term, except as expressly provided in this Agreement,
including Sections 4.05 (Brand; Policy Trailer; Branded Slots), 4.06(a)
(Beverage Agreements), 4.07 (Other Regal Advertising Agreements), 4.08 (Regal
Run-Out Obligations), 4.13 (Excluded Theatres; IMAX Screens), 4.14 (Grand
Openings; Popcorn Tubs; Employee Uniforms); 6.07 (Use of Digital Content
Network) and Exhibit A, Regal shall subscribe for and LLC shall be
the exclusive provider to the Theatres of the services specifically set forth
in the definition of the “Service.” 
Except as expressly provided in this Agreement, during the Term, Regal
shall neither engage nor permit a third party (excluding third party designees
of LLC as provided hereunder) to provide, or itself provide, to a Theatre any
of the services specifically set forth in the definition of Service.  Nothing in this Agreement shall limit or
affect (i) LLC’s ability to contract or enter into any relationship with
any Person or entity for any product, service, or otherwise, whether or not
similar to any products or services provided by LLC under this Agreement, or
(ii) Regal’s ability to contract or enter into any relationship with any
Person or entity for any product, service, or otherwise, other than the
services that will be provided exclusively by LLC as set forth in this
Section 2.04.  All rights with
respect to advertising and promotions not explicitly granted hereunder are
reserved to Regal, including without limitation Regal’s ability to offer and
sell advertising to any third party on any website on the Internet, its
telephone ticketing service or other alternative media sources used for
ticketing.

Section 2.05         ESA
Modification Payments; Theatre Access Fees.

(a)           ESA
Modification Payments.

(i)            Regal Initial ESA Modification
Payment.  As of the date hereof, and
in consideration for Regal’s agreement to use a Theatre Access Fee calculation
and payment mechanism (as described in Section 2.05(b)) in connection with LLC’s
utilization of the Theatres

 15
 

on and after the date of this
Agreement, LLC will pay to Regal $281,024,120 (such amount being the “Regal
Initial ESA Modification Payment”).

(ii)           ESA-Related Tax Benefit Payments.  After the date hereof, and in consideration
for Regal’s agreement to use a Theatre Access Fee calculation and payment
mechanism (as described in Section 2.05(b)) in connection with LLC’s
utilization of the Theatres on and after the date of this Agreement, LLC will
also pay any ESA-Related Tax Benefit Payments to Regal, pursuant to the terms
of the Tax Receivable Agreement.

(iii)          Adjustments.  The Regal Initial ESA Modification Payment
will be subject to contingent and ongoing adjustments, pursuant to the Unit
Adjustment Agreement.

(b)           Theatre
Access Fees.

(i)            Calculation.  In consideration for utilization of the
Theatres pursuant to the terms hereof, LLC shall calculate and Regal shall be
entitled to receive a Theatre Access Fee, as set forth in Schedule 1,
which shall be paid based on Regal’s attendance for the relevant fiscal month
in which LLC provides the Services and number of Digital Screens during the
fiscal month in which LLC provides the Services (calculated as the average
between the number of Digital Screens on the last day of the fiscal month
preceding the relevant fiscal month in which LLC provides the Services and the
last day of the fiscal month in which LLC provides the Services), and which
shall include the amount of 4.03 Revenue allocated to Circuit A for the
same fiscal month.

(ii)           Payment.  LLC shall pay Regal its Theatre Access Fees
on or before the last day of LLC’s fiscal month following the fiscal month in
which Services are provided by LLC; provided that Regal has, by the
fourteenth day of LLC’s fiscal month following the month in which Services are
provided by LLC, given LLC the data regarding attendance and number of Digital
Screens necessary for LLC to calculate the Theatre Access Fee.  If Regal has not, by the fourteenth day of
LLC’s fiscal month following the month in which Services are provided by LLC,
given LLC the data regarding attendance and number of Digital Screens necessary
for LLC to calculate the Theatre Access Fee, the due date of the Theatre Access
Fee payment shall be extended by one day for each day that Regal is late in
providing such data.  LLC shall provide
Regal with a detailed accounting of the calculation of Theatre Access Fees
pursuant to Schedule 1, which report shall accompany each such payment.

(iii)          Supplemental Theatre Access Fee.  If applicable, LLC shall pay Regal a Supplemental
Theatre Access Fee, as set forth in Schedule 1, on or before the last day
of LLC’s fiscal month following the end of LLC’s applicable fiscal year.

Section 2.06         Non-Cash
Consideration.  Any
Aggregate Advertising Revenue, revenue related to Event Sponsorship, revenue
related to Digital Programming Services or revenue related to Meeting Services
that LLC receives in the form of non-cash consideration shall be valued as
revenue in accordance with GAAP.  If LLC’s
value of non-cash consideration received under any arrangement exceeds $500,000
but is not greater than $5 million from any party in a single transaction
or series of related transactions, such value shall be confirmed by National
CineMedia, if it is LLC’s managing member, or LLC’s then managing member.  If LLC’s value

 16
 

of non-cash consideration received under any arrangement exceeds
$5 million from any party in a single transaction or series of related
transactions, LLC shall engage an independent qualified appraiser to determine
the fair market value of such non-cash consideration.  Notwithstanding the foregoing, no
confirmation or appraisal of value shall be required for LLC’s acquisition of
tickets from Founding Members at their published group sale price in exchange
for advertising at LLC’s rate card rate.

ARTICLE
3

EQUIPMENT

Section 3.01         Procurement;
Cost; Specifications.  The Parties agree that all Theatre-level
Equipment required to exhibit and otherwise participate in the Service on the
terms and conditions set forth herein has been installed in all Theatres as of
the Effective Date.  With respect to all
Newbuild Theatres, Acquisition Theatres, and Theatres which are converted from
Non-Digitized Theatres to Digitized Theatres or from Digitized Theatres to
Non-Digitized Theatres after the Effective Date (collectively, the “Future
Theatres”), LLC shall, except as provided in Section 3.03, be solely
responsible for procuring any Equipment for such Theatres.  LLC shall bear the cost of all Equipment for
use outside the Theatres, as well as Equipment installed in the Theatres for
maintenance purposes (if any) (a description of such LLC Equipment installed in
the Theatres is included in the Specification Documentation; which may be
amended by mutual written agreement of the Parties) and the Software.  Regal shall reimburse LLC, at LLC’s cost, for
all other Equipment to be installed at or within any Future Theatres (a
description of such Regal Equipment is included in the Specification
Documentation; which may be amended by mutual written agreement of the Parties)
within thirty (30) days after (i) the installation of such Equipment by
Regal or LLC in accordance with Section 3.04 and (ii) the delivery of
invoices by LLC to Regal supporting the expenses for which reimbursement is
sought.  All Theatre-level operational
costs associated with Regal’s use of Equipment located in the Theatres, such as
the cost of electricity, shall be borne exclusively by Regal.  LLC shall assure that the Equipment purchased
by LLC satisfies Regal’s specifications for such equipment, including the
communication interface between LLC Equipment and Regal Equipment.

Section 3.02         Ownership
of Equipment. 
As between the Parties, each Party will own the Equipment it pays for or
reimburses the other Party for, whether pursuant to Section 3.01 or
Section 3.03.  To the extent
possible, LLC agrees to assign to Regal any manufacturer warranties applicable
to Regal Equipment procured by LLC pursuant to Section 3.01.  If for any reason the aforementioned
warranties are not assignable, upon written request of Regal, LLC shall use
commercially reasonable efforts to enforce the warranties on behalf of
Regal.  Notwithstanding anything to the
contrary herein, any LLC Equipment placed or installed in a Theatre for
maintenance purposes may, upon termination of this Agreement or deletion of a
particular Theatre as provided herein, as applicable, be removed by LLC and
held for its sole benefit.

Section 3.03         Regal
Equipment. 
Regal shall be permitted to furnish any of the Equipment, at its sole
cost and expense, upon consultation with LLC, and provided such Equipment
satisfies LLC’s specifications for such Equipment (including compatibility with
the Digital Content Network).  LLC agrees
to cooperate with Regal in good faith to permit the

 17
 

procurement by Regal of Equipment in lieu of procurement of such
Equipment by LLC and reimbursement by Regal pursuant to Section 3.01.

Section 3.04         Installation.

(a)           Performance.  Regal and/or its subcontractors shall be
solely responsible for the installation of all Equipment purchased pursuant to
Section 3.01 or Section 3.03, as well as for ancillary services such
as reporting, software integration and system cutover; provided, however,
that Regal may elect to have LLC perform such services, and LLC shall then
assume the responsibility for installation of all Equipment.  If Regal elects for LLC to assume the
responsibility for installation of all Equipment, (i) Regal shall
reimburse LLC for the cost of installing Regal Equipment as set forth in the
Specification Documentation, (ii) LLC will not issue invoices for any
Equipment cost, or installation services related to such Equipment until the
completion of such installation services, and (iii) LLC shall ensure that
Equipment installed pursuant to this section is made functional in accordance
with any installation rollout schedule agreed to by the Parties, as may be
amended from time to time upon mutual agreement of the Parties or as
circumstances warrant.

(b)           Consultation;
Landline.  The Parties agree to
consult with each other with respect to any modifications to Theatre premises
necessary for receipt of the Service. 
LLC shall use commercially reasonable efforts to limit the size and
number of satellite dishes that are required as part of the Equipment.  Regal shall be solely responsible for
obtaining any consents required for the installation or use of any Equipment at
any Theatre, including without limitation governmental and landlord consents,
provided LLC reasonably cooperates with Regal at Regal’s request in obtaining
such consents.  If Regal cannot obtain
consent to installation of a satellite dish at a Theatre because of technical,
landlord or legal restrictions, Regal and LLC shall work together in good faith
to establish a landline connection to such location for the Digital Content
Network.  All costs of the landline
connection, which shall be maintained with sufficient bandwidth for delivery of
the Digital Content Service, shall be borne by LLC with respect to delivery of
content from LLC to Regal’s wide area network and by Regal with respect to
delivery of content from Regal’s wide area network to the applicable Theatres.

(c)           Coordination.  All installation, maintenance and other
services provided by LLC to the Theatres hereunder shall be performed in a
manner reasonably expected not to disrupt Regal’s operations and, except where
no practical alternative exists, shall be provided outside of Theatre business
hours, as mutually determined by the Parties in their reasonable
discretion.  Subject to the preceding sentence
and upon advance written notice, LLC and its vendors or subcontractors shall be
provided reasonable access to the Theatres and such other support services as
reasonably required to install and inspect the Equipment, for such fees as
provided in the Specification Documentation, and otherwise as required to
perform LLC’s obligations under this Agreement. 
In addition to the foregoing, and with respect to the installation of
Equipment in Newbuild Theatres only, LLC agrees (i) to cooperate with
Regal in coordinating the installation of Equipment with the construction
schedule for such Newbuild Theatres, and (ii) to consult with Regal prior
to subcontracting the performance of Equipment installation so as to permit a
determination of whether Regal might itself perform such Equipment
installation.

 18
 

Section 3.05         Upgrades
and Modifications. 
In order to ensure compatibility with, and optimum performance and
robustness of, the Digital Content Network and the LLC Equipment (including
hardware and software), LLC reserves the right to request of Regal the
replacement, upgrade or modification of any Regal Equipment installed at any
Theatre or the assistance with an upgrade to Software on Regal Equipment; provided
that such requests are equally and timely communicated to each of Regal, AMC
and Cinemark (the “Upgrade Request”).  In
the event of an Upgrade Request, LLC shall provide Regal as much written notice
as is reasonably practicable under the circumstances, but in no event less than
ten (10) business days written notice. 
LLC and Regal will negotiate with each other in good faith on the terms
of any Upgrade Requests, including cost sharing terms, if any.  If LLC and Regal are not able to come to
agreement about an Upgrade Request, LLC may elect to pay for the replacements,
upgrades or modifications contained in the Upgrade Request including all
reasonable incidental and incremental costs to Regal, and Regal shall be
obligated to permit LLC to perform all necessary work to fulfill the Upgrade
Request, provided (i) there is no additional unreimbursed cost to
it to accept such replacement, upgrade or modification and (ii) that such
replacement, upgrade or modification does not unreasonably interfere with Regal’s
theatre operations and does not include any replacement, upgrade or
modification of Regal software without Regal’s express prior written
consent.  LLC agrees that, to the extent
practicable, it will develop a system that seeks to minimize the need to enter
the Theatres in order to update the Software.

Section 3.06         Network
Integration. 
The Parties shall use commercially reasonable efforts to ensure that the
Digital Content Network will be integrated with any network for delivery of
Digital Cinema Services such that the Services can be delivered over such
network.

Section 3.07         Training.  To the extent necessary, LLC and Regal,
respectively, will provide training services to Regal’s support staff and
customer service and other employees and agents on terms as mutually agreed by
the Parties in their reasonable discretion.  LLC agrees that it will pay for these training
services and they will be adequate to permit Regal to train its own employees
and agents as required to perform under this Agreement.  Regal agrees to provide training services
according to any reasonable standards as may be promulgated by LLC in
consultation with Regal.  LLC agrees to
provide training services, at its cost, to Regal’s support staff and other
employees with respect to any Equipment or Software upgrades or modifications
prior to implementation.

Section 3.08         Equipment
Maintenance Standard.

(a)           Standard;
Replacement.  During the Term, the
Parties shall each use their commercially reasonable efforts (i) to ensure
there is no unauthorized access, loss or damage to or theft of Equipment
hereunder, and (ii) to prevent piracy or other theft of Inventory
exhibited through the use of such Equipment or otherwise in its possession or
control.  Regal further agrees to keep
all Regal Equipment, including without limitation Lobby Screens, clean, and to
promptly notify LLC if any Regal Equipment is not functioning properly.  Regal shall promptly arrange to repair or
replace any Equipment in its possession (provided the damage interferes with
the delivery of the Service) that is lost, stolen, damaged or otherwise fails
to function or becomes inoperable, other than because of LLC’s failure to
properly maintain the Equipment as set forth in Section 3.08(b).

 19
 

(b)           Performance
of Repair and Replacement.  Subject
to the terms of this Section 3.08(b) and of Section 3.08(c) below
regarding cost, the repair and replacement of Equipment shall be performed by
LLC until such time as Regal elects to assume this responsibility by giving
written notice to LLC.  If Regal assumes
this responsibility to perform replacement or repair but fails to maintain the
Regal Equipment at a performance level substantially similar to the LLC
Equipment, then LLC shall promptly provide Regal written notice of such failure
and if such failure is not cured within 30 days, LLC shall be entitled to repair,
or if repair is not reasonably possible, replace such LLC Equipment not so
maintained and deduct the cost of such replacement from Regal’s Theatre Access
Fees.

(c)           Repair
Costs.  So long as LLC is performing
repair and replacement of Equipment, LLC shall pay the costs of repair (but not
replacement, which is the responsibility of Regal).  Notwithstanding anything to the contrary in
this Section 3.08, LLC shall not be required or requested to make any
expenditures that (i) would constitute a capital expenditure for LLC under
GAAP or (ii) would have otherwise been payable by Regal’s insurance
provider; provided, however, LLC shall be responsible for all
costs to repair or replace Equipment to the extent damaged as a result of the
negligence or misconduct of LLC and/or its subcontractors.

(d)           Condition.  Subject to the foregoing, for purposes of
ongoing maintenance, LLC shall keep and maintain Equipment installed in the
Theatres in good condition and repair at its sole expense (with the exception
of projector bulb replacement and equipment replacement, the cost of which
shall be borne by Regal), and in a manner consistent with the Service Level
Agreement set forth in the Specification Documentation and as may be reasonably
amended by mutual agreement of LLC and Regal from time to time.  The Parties agree to consult with each other
on a regular basis during the Term in an attempt to reduce maintenance costs
arising from redundancies in the Parties’ respective service fleets.  Upon advance notice to Regal, Regal shall
provide LLC and/or its subcontractors reasonable access to the Equipment and
such other support services as LLC and/or its subcontractors reasonably require
to provide maintenance and repair services as required hereunder.

ARTICLE
4

DELIVERY
OF THE SERVICE

Section 4.01         Content
and Distribution of the Digital Content Service and Traditional Content Program.

(a)           Distribution;
Quality.  On the Effective Date, LLC
will commence distribution of the Digital Carousel, the Digital Content Service
and the Traditional Content Program to the Digitized Theatres and Non-Digitized
Theatres, all as set forth above in Article 2.  With respect to Digitized Theatres, content
shall be distributed through the Digital Content Network, via either LLC’s
satellite network or by LLC’s or exhibitor’s landline network.  Each of the Pre-Feature Program and the Video
Display Program shall consist of Inventory comprising a single play list (“Play
List”).  The Play List will be refreshed
during the Term when and as determined by LLC but not less frequently than
12 times per year (each a “Flight”). 
The Digital Carousel, the Digital Content Service (including the
Pre-Feature Programming Schedule) and the Traditional Content Program will be
substantially similar in nature, quality, and scope to the

 20
 

corresponding advertising, promotional and other content, as received
by the Theatres immediately prior to the Effective Date, and will in addition
be delivered pursuant to the service levels included in the Specification
Documentation, as applicable.  In
addition, LLC agrees that the quality of the advertising, promotions and
entertainment programming content delivered to each of the Founding Members
will be consistent throughout the Term.

(b)           Pre-Feature
Program.  As of the Effective Date,
the Pre-Feature Program shall consist of four (4) or more elements,
including:  (i) commercial
advertising; (ii) promotions for the Regal brand (including the Brand and
Branded Slots), Concessions sold and services used by Regal and other products
and services in accordance with Section 4.05; (iii) interstitial
content; and (iv) other entertainment programming content which, while
promotional of businesses or products, shall be primarily entertaining,
educational or informational in nature, rather than commercially inspired.

(c)           Video
Display Program.  The elements of the
Video Display Program shall be, generally, the same as those for the
Pre-Feature Program, and will include the Brand and the Branded Slots.  LLC specifically agrees that the Video
Display Program will contain only material that has received, or had it been
rated would have received, an MPAA “G” or “PG” rating.  In addition, LLC shall not restrict the sale
of Inventory from the Video Display Program for promotions of feature
films.  Lobby Screens displaying the
Video Display Program shall be located in areas of Theatres of LLC’s choosing
(subject to Regal’s reasonable operational constraints and provided relocation
of existing Lobby Screens is not required). 
Regal is obligated to provide at least one Lobby Screen per Digitized
Theatre with ten or fewer screens, two Lobby Screens per Digitized Theatre with
eleven to twenty screens and three Lobby Screens per Digitized Theatre with
more than twenty screens; provided, however, that Regal shall have
no obligation to increase the number of Lobby Screens in any Theatre that has
at least one Lobby Screen that is capable of receiving the Video Display
Program as of the Effective Date.  When a
Theatre has more than the minimum number of Lobby Screens required, Regal may,
at its discretion, elect to display on such excess Lobby Screens (i) the
Video Display Program or (ii) internal programming (including Theatre
Advertising) that does not include third-party advertising and/or third-party
mentions for products and services (other than Theatre Advertising); provided,
however, Regal shall provide at least 30 days advance notice prior
to an initial election of either (i) or (ii) in any such Theatre, and at least
60 days advance notice prior to any subsequent change in election.

Section 4.02         Delivery
of Lobby Promotions, Digital Programming Services and Meeting Services.

(a)           Lobby
Promotions.  On the Effective Date,
LLC will make available to the Theatres the Lobby Promotions, and Regal will
accept such Lobby Promotions on the terms and conditions set forth herein.

(i)            Lobby Promotions shall satisfy the
guidelines and specifications set forth herein and as may be provided by Regal
to LLC pursuant to Section 4.02(a)(ii). 
The Inventory of Lobby Promotions for each Theatre that Regal covenants
to display pursuant to this Agreement is set forth in Exhibit A-1.  LLC may provide additional Lobby Promotions (“Additional
Lobby Promotions”), subject to approval by Regal.  LLC will take all other actions

 21
 

necessary and prudent to ensure
the delivery of Lobby Promotions as required under the terms hereof.  LLC will inform Regal of the length of time
that Lobby Promotions and Additional Lobby Promotions are to be displayed.

(ii)           LLC covenants and agrees that Lobby
Promotions provided pursuant to this Agreement will conform to all standards
and specifications of which Regal provides LLC reasonable notice during the
Term, including without limitation standards and specifications with respect to
manufacturers and suppliers, sizing (e.g., cup and popcorn tub sizing), timing
of delivery of concession supplies to Theatres, reimbursement of incremental
costs (e.g., cups, floor mats, plates) and the like.  LLC further covenants that the Lobby Promotions
will not diminish or tarnish the reputation of Regal or unreasonably disrupt
Theatre operations, including, without limitation, traffic flow or noise level,
each as determined in Regal’s reasonable discretion, and that Lobby Promotions
will comply with the content standards set forth in Section 4.03.  LLC specifically agrees (i) that Lobby
Promotions will contain only material that has received, or had it been rated
would have received, an MPAA “G” or “PG” rating, (ii) that the only type
of sampling that will be permitted is exit sampling, (iii) to refrain from
distributing chewing gum as part of any Lobby Promotion, other than attended
sampling as patrons are exiting the Theatre, (iv) not to permit a Lobby
Promotion that would distribute or sample any item that is the same as or
substantially similar to any item sold at the Theatre’s concession stand and
(v) not to permit a Lobby Promotion involving fund raising on Theatre
property.

(iii)          LLC will be responsible for all costs
and expenses associated with sourcing, production, delivery and execution of
Lobby Promotions to the Theatres, including incremental costs actually incurred
by the Theatres in connection with Lobby Promotions.  In its discretion, Regal may make employees
available to assist in Lobby Promotions requiring exit sampling; provided
that LLC shall reimburse Regal for the employees’ time used to conduct the exit
sampling at their customary wage.

(b)           Digital
Programming Services and Meeting Services. 
On the Effective Date, LLC will make available to Digitized Theatres all
Digital Programming Services and Meeting Services as set forth in
Article 6.

Section 4.03         Content
Standards. 
The Parties agree that (unless mutually agreed by the Parties with
respect to clauses (i), (iii), (iv), (v) or (vi)) all content within the
Service (including content for display in Digital Programming or Meeting
Services) will not contain content or other material that:  (i) has received, or had it been rated
would have received, an MPAA “X” or “NC-17” rating (or the equivalent),
(ii) promotes illegal activity, (iii) promotes the use of tobacco,
sexual aids, birth control, firearms, weapons or similar products;
(iv) promotes alcohol, except prior to “R”-rated films in the auditorium;
(v) constitutes religious advertising (except on a local basis, exhibiting
time and location for local church services); (vi) constitutes political
advertising or promotes gambling; (vii) promotes theatres, theatre
circuits or other entities that are competitive with Regal or LLC;
(viii) would violate any of Regal’s Beverage Agreements or the exclusive
contractual relationships identified in the Specification Documentation
(including renewals and extensions of the foregoing, but excluding any
amendments or modifications thereto as such relate to such content standards)
and any subsequent exclusive arrangement entered into by LLC with respect to
the Theatres; or

 22
 

(ix) otherwise reflects negatively on Regal or adversely affects
Regal’s attendance as determined in Regal’s reasonable discretion.  Regal may, without liability, breach or
otherwise, prevent and/or take any other actions with respect to the use or
distribution of content that violates the foregoing standards; provided,
that with respect to Section 4.03(ix), Regal may opt out of such content
in the Services only with respect to Theatres in the geographic locations
identified, which may include all of Regal’s Theatres.  If the Digital Content Service contains any
content that violates the foregoing standards, LLC must remove such content as
soon as reasonably practical, but no later than within 24 hours of Regal
notifying LLC of such violation.  If LLC
fails to remove such content within such 24-hour period, Regal may discontinue
the Digital Content Service in such auditoriums where such content is shown
until the violating content is removed and shall have no liability for such
discontinuation.  If any other elements
of the Service contain any content that violates the foregoing standards, LLC
shall at Regal’s request, or Regal acting on its own behalf may, upon giving written
notice to LLC, remove such content immediately. 
If any Founding Member opts out of any Lobby Promotion or other
advertising pursuant to Section 4.03(viii) or (ix) of this Agreement,
the AMC Exhibitor Agreement or the Cinemark Exhibitor Agreement (as applicable)
or out of any Video Display Program because of lack of equipment to display
such content, or if any Founding Member does not agree to exhibit any content
of the Advertising Services subject to Section 4.03(i), (iii), (iv), (v)
or (vi), then LLC shall apply any revenue it is entitled to receive from such
Advertising Services (“4.03 Revenue”) to adjust payments of the Theatre Access
Fee as set forth in Schedule 1.

Section 4.04         Development
of the Service. 
All operational costs associated with LLC’s procurement, preparation and
delivery of the Service (including Inventory and other promotional materials as
provided herein) to the Theatres shall be borne exclusively by LLC.  Except as provided herein, all in-Theatre
operational costs associated with Regal’s receipt and exhibition of the Service
within the Theatres shall be borne exclusively by Regal; provided that,
upon prior written notice to and consultation with LLC, LLC shall reimburse
Regal for its reasonable incremental out-of-pocket third party costs incurred
in connection with receipt and exhibition of the Service within the
Theatres.  Any excess on-screen Inventory
which may be made available to Regal in LLC’s discretion pursuant to
Section 5.04 or otherwise, and any other on-screen Inventory provided by
Regal pursuant to Section 4.05, will be subject to both Parties’ review
and approval, which will not be unreasonably withheld.  LLC will provide at its own expense all
creative and post-production services necessary to ingest, encode and otherwise
prepare for distribution all other on-screen Inventory as part of the Digital
Content Service.  All on-screen Inventory
provided by Regal for inclusion in the Digital Content Service must (i) be
submitted to LLC for review for compliance with (ii) and (iii) below as LLC may
reasonably request, but in any event at least twenty (20) business days before
scheduled exhibition (unless otherwise previously approved by LLC),
(ii) satisfy the content restrictions enumerated in Section 4.03(i)
through (vii) hereof, and (iii) be fully produced in accordance with LLC’s
technical specifications as promulgated by LLC from time to time (all as
provided in written or electronic form to Regal in a reasonable time period
prior to implementation, including any amendments thereto; and which are
equally applied to all exhibitors), ready for exhibition, as well as in
accordance with applicable LLC commercial standards and operating policies, and
all applicable federal, state and local laws and regulations.  LLC must reject or approve all Inventory
provided by Regal within five (5) business days.  Any such Inventory provided by Regal and not
rejected within such time frame shall be deemed approved and incorporated into
the Service.  Any

 23
 

Inventory provided by Regal for review and approval by LLC need not,
once approved by LLC, be resubmitted by Regal for approval in connection with
any future use.

Section 4.05         Brand;
Policy Trailer; Branded Slots.

(a)           Branded
Content.  LLC agrees to create, in
conjunction with and subject to Regal’s prior approval, a Regal brand identity
(the “Brand”) that will surround, or “house,” the Digital Content Service and
include interstitial messaging (“bridges and bumps”), throughout the Play List
and in the Policy Trailer, to reinforce the Brand.  The interstitial messaging shall include a
Pre-Feature Program introduction and close containing content branded with the
Regal Marks.  The close shall also
include content branded with the marks of Regal’s beverage concessionaire.  The Brand shall not contain the display of
any trademark, service mark, logo or other branding of a film, film studio(s),
distributor(s), or production company(ies). 
In addition to the interstitial messaging, the Digital Content Service
will feature (i) up to two (2) minutes for the promotion of Regal’s
internal business (the “Branded Slots”) in each Play List, (ii) the Policy
Trailer, to be created by LLC at the direction of Regal as part of the Creative
Services, (iii)  the Event Trailer, and (iv) any other content as may
be agreed between Regal and LLC.  The
Parties hereby acknowledge that Regal has the right to exhibit the PSA Trailer
after Showtime.

(b)           Policy
Trailer.  The policy trailer will be
(i) up to 60 seconds, (ii) exhibited in the Theatres after
Showtime, and (iii) used to feature content relating to Theatre policy and
operations, and may include (w) a policy service announcement that
promotes appropriate theatre behavior, (x) promotions of Regal
Concessions, (y) the display of any trademark, service mark, logo or other
branding of a film studio(s), distributor(s), or production company(ies) and
(z) upon prior written approval of Regal, other promotional materials of
third-party products for which LLC sells advertising and is paid a fee (the
“Policy Trailer”).  

(c)           Branded
Slot.  Each Branded Slot may only
exhibit Theatre Advertising.  LLC is
required to include no less than forty-five (45) seconds of Branded Slots
within the final fifteen (15) minutes of the Play List, fifteen (15) seconds of
which shall be included within the final eleven (11) minutes of the Play List; provided,
that LLC may begin these Branded Slots up to one minute earlier when LLC
expands the amount of advertising units that follow these Branded Slots through
the sale of additional advertising to third parties. LLC shall not exhibit any
advertising relating to LLC after Regal’s Branded Slot placement referred to in
this Section 4.05(c).

(d)           Restrictions.  Other than as permitted in
Sections 4.05(a), (b), (c) or Section 4.07, the Brand, the Policy Trailer
or the Branded Slot will not include third-party advertising and/or third-party
mentions for products and services, without LLC’s prior written approval.  

(e)           Creative
Services.  The Brand messaging,
Policy Trailer and Branded Slots may be created and edited by LLC as part of
the Creative Services, in consultation with Regal, subject to final, mutual
agreement of the Parties.  LLC will
provide Regal with up to 1,000 hours of Creative Services annually at no
cost.  Time spent on Creative Services
and costs after the initial 1,000 hours shall be determined as described
in Exhibit B.  Regal may use
other vendors for creative services at Regal’s cost and subject to LLC’s
production standards.

 24

(f)            Traditional
Content Program.  The Traditional
Content Program in Non-Digitized Theatres will contain, at a minimum,
promotions for Regal’s beverage and other Concessions.  

Section 4.06         Beverage
and Legacy Agreements.

(a)           Beverage
Agreements.  LLC shall, through the
expiration or other termination of Regal’s Beverage Agreement in effect on the
date hereof, display or exhibit, as applicable, as part of the Advertising
Services, advertising Inventory meeting any and all specifications and
requirements prescribed by the Beverage Agreement, including format, length
(not to be longer than ninety (90) seconds), and placement within the Play
List, as set forth in the Specification Documentation, with compliance by LLC
to be within a reasonable time after such specifications are communicated from
time-to-time by Regal to LLC in a written notice.  In consideration for the advertising pursuant
to the Beverage Agreement, Regal agrees to pay LLC at the advertising rates set
forth on Exhibit B (the “Beverage Agreement Advertising Rate”).  The Beverage Agreement Advertising Rate shall
be paid on or before the last day of LLC’s fiscal month following LLC’s fiscal
month in which the Advertising Services related to the Beverage Agreement were
provided.  Beginning after Regal’s
Beverage Agreement in effect on the date hereof expires or otherwise terminates
through the end of the Term, Regal shall have the right to have included in the
Advertising Services advertising Inventory for its beverage concessionaires at
the then current Beverage Agreement Advertising Rate; provided that
Regal (i) keeps LLC apprised of the status of negotiations with the
beverage vendor (including likelihood of reaching agreement, advertising length
and placement required), from the time such negotiations begin until an
agreement is signed, and (ii) provides LLC notice (including advertising
length and placement required) within two (2) business days after the date that
Regal and its beverage concessionaire agree on terms for a new Beverage Agreement.
 Regal shall be permitted to prescribe
the length and placement within the Play List of on-screen Inventory based on
the requirements of the Beverage Agreements which may then be in effect between
Regal and such then-applicable beverage concessionaires; provided that
such Inventory shall not exceed ninety (90) seconds in length for all such
Beverage Agreements.  Regal-redacted
and/or Regal-selected (by disclosure or summary) contents of the Beverage
Agreement shall only be disclosed as, and to the extent, required pursuant to
this Agreement, provided such disclosure would not violate the terms of such
Beverage Agreement.

(b)           Regal
Legacy Agreements.  

(i)            The Specification Documentation sets
forth a list of the Regal Legacy Agreements, including the identity of each
advertiser.  On the Effective Date, Regal
shall assign all rights and obligations arising from or out of each Regal
Legacy Agreement to LLC.  

(ii)           This Agreement shall not constitute
an assignment or transfer, or an attempted assignment or transfer, of any Regal
Legacy Agreement, if and to the extent such agreement is a “Non-Assignable
Legacy Agreement,” meaning that the assignment or transfer of such Regal Legacy
Agreement would constitute a breach of the terms of such Regal Legacy
Agreement.  Regal and LLC shall use
commercially reasonable efforts to obtain a waiver to assignment of any
Non-Assignable Legacy Agreement and in the meantime Regal shall pay to LLC all
proceeds from any Legacy Agreement.  To
the extent that any waiver referred to in this

 25
 

Section 4.06(b) is not obtained by Regal, Regal shall also use
commercially reasonable efforts to, at the request of LLC, enforce for the
account of LLC any right of Regal arising from any Non-Assignable Legacy
Agreement.  LLC shall perform the obligations
of Regal under or in connection with any Non-Assignable Legacy Agreement,
except to the extent that LLC is not provided the benefits thereof in any
material respect pursuant to this Section 4.06(b).

Section 4.07         Other
Regal Advertising Agreements.  

(a)           Theatre
Advertising.  In addition to
advertising Inventory referenced above in Sections 4.05 and 4.06, Regal
may purchase, on an arm’s length basis and subject to availability, as part of
the Advertising Services, advertising Inventory for Theatre Advertising. Regal
shall pay for Services pursuant to this Section 4.07(a) on or before the
last day of LLC’s fiscal month following LLC’s fiscal month in which the
Services were provided.  

(b)           Non-Theatre
Advertising.  Regal may enter into a
cross-marketing arrangement designed to promote the Theatres and the
movie-going experience with a local, regional or nationally-known vendor of
products or services that are not of the type described in Theatre Advertising
for the purpose of generating increased attendance at the Theatres or increased
revenue for Regal (other than revenue from any Service) (the “Strategic
Relationship”) with advertising of such products or services being presented in
the Theatres (either in the Video Display Program or in Lobby Promotions) (“Strategic
Programs”), subject to the terms set forth in this Section 4.07(b).  Strategic Programs may not be made on an
exclusive basis.  Regal covenants that it
shall not re-sell any Advertising Services, including those received in
connection with Strategic Programs. 
Strategic Programs shall be subject to the following limitations:

(i)            Regal may conduct at no cost with
respect to any Strategic Programs no more than (A) two (2) local or
regional promotions per Flight per Theatre and (B) four (4) national
promotions per year; provided, however, that no more than one
national promotion may run at any time (the “Client Limitation”).  By means of illustration, the Client
Limitation for national promotions are not limited to a Flight, accordingly,
one national promotion may run for twelve months, two national promotions may
run for six months each provided that they do not run at the same time, four
national promotions may run for three months each provided that they do not run
at the same time, or another combination of national promotions may be used if
there are no more than four promotions within a twelve-month period.  For purposes of this Section 4.07(b),
each continuously running promotion is counted as one promotion, regardless of
whether such promotion is displayed using only one element (e.g., Lobby
Screens) or displayed in an integrated basis using multiple elements (e.g.,
Lobby Screens and Lobby Promotions). 
Additionally, for purposes of this Section 4.07(b), a local or
regional promotion is a promotion that is exhibited in Theatres located within
one or two contiguous Designated Marketing Areas (as defined by the term DMA®, a registered trademark of
Nielsen Marketing Research, Inc.), and a national promotion is a promotion that
is exhibited in Theatres located within two (other than two contiguous) or more
Designated Marketing Areas.  

(ii)           With respect to Strategic Programs in
the Video Display Program (“Strategic LEN Promotions”), Regal may utilize at no
cost up to one minute of time for its Strategic Programs per every thirty (30)
minutes of the Video Display Program advertising.  

 26
 

Regal may purchase an
additional one minute for every thirty (30) minutes of the Video Display
Program advertising for use in Strategic Programs at the applicable rate card
rate for third-party advertising established by LLC for such Video Display
Program advertising inventory.  Any
purchase of time for Strategic LEN Promotions in excess of the two minutes
described above or any utilization of Strategic LEN Promotions in excess of the
Client Limitation may be obtained at rate card rates and subject to
availability, only with prior written consent of LLC, acting in its sole
discretion.   Strategic LEN Promotions may not be displayed
on any Lobby Screens that, pursuant to Section 4.01(c), are displaying
internal programming of Regal and may not be made to promote any film, film
studio(s), distributor(s) or production company(ies).

(iii)          With respect to Strategic Programs
through Lobby Promotions (“Strategic Lobby Promotions”), Regal may utilize only
such type and number of Inventory that is available to LLC in the applicable
Theatre(s) on a pre-approved basis; provided, however,
vehicle/motorcycle displays and floor mats will not be available for use in
Strategic Lobby Promotions.  Regal may
purchase an additional amount of Inventory in excess of the Strategic Lobby
Promotions described above or in excess of the Client Limitation at rate card
rates and subject to availability, only with prior written consent of LLC,
acting in its sole discretion.

Section 4.08         Regal
Run-Out Obligations.  

(a)           Encumbered
Theatres.  Regal agrees to provide
LLC written notice as much in advance as is reasonably practicable under the
circumstances of, and to furnish LLC true and correct copies (reasonably
redacted by Regal and subject to confidentiality) of all documentation
evidencing, all valid, pre-existing contractual obligations (the “Run-Out
Obligations”) relating to any of the advertising, promotional and event
activities and services in any Acquisition Theatres (collectively, the “Encumbered
Theatres”); provided such disclosure does not violate the terms of any
such agreements.  

(i)            Agreements
with advertisers that purchase advertising are Legacy Agreements and do not
create Run-Out Obligations.  Regal shall,
effective upon acquisition of the Acquisition Theatre, terminate any agreements
between Regal and an Affiliate relating to advertising, promotional and event
activities and services in any Acquisition Theatre, so that any such agreements
do not create Run-Out Obligations.  

(ii)           Regal
and/or its Affiliates (as applicable) shall be permitted to abide by the terms
of the Run-Out Obligations; however, Regal agrees, subject to legal constraints
(if any), to use commercially reasonable efforts to obtain the termination of
such Run-Out Obligations, including without limitation neither extending nor
renewing such Run-Out Obligations (provided that Regal shall have no
obligation to make any payment in connection with obtaining the termination of
such Run-Out Obligations).  Regal further
agrees not to enter into any new agreement with any third party with respect to
any Encumbered Theatre, or amend or modify any Run-Out Obligation, to the
extent such agreement, amendment or modification would be inconsistent with the
rights of LLC under Section 2.04 or have the effect of any extension.  Prior to the expiration of the Run-Out
Obligations, each Encumbered Theatre may, upon the mutual agreement of LLC and
Regal, become a Theatre with respect to some or all Services, provided
such election does not create a default under any Run-Out Obligation.  In any event, except in accordance with
Section 4.13 (Excluded Theatres; IMAX Screens) or as may be

 27
 

mutually agreed by the Parties in writing, each Encumbered Theatre
shall automatically become a Theatre, for all purposes hereof, no later than
the expiration of the Run-Out Obligations with respect to such Encumbered
Theatre.  

(b)           Exclusive
Run-Out Obligations.  With respect to
each Service for which the third party to the Run-Out Obligations has exclusive
rights as a service provider, if Regal has provided LLC with written notice of
Regal’s intent to receive additional equity in LLC with respect to the
Encumbered Theatres pursuant to the Unit Adjustment Agreement, Regal shall,
until such Run-Out Obligations have terminated, make a quarterly Exclusivity
Run-Out Payment (as defined in Schedule 1) to LLC.  Any such payments shall be made on or before
the last day of LLC’s fiscal month following the fiscal quarter in which Regal
receives the Services from the third party to the Run-Out Obligations.  

(c)           Non-Exclusive
Run-Out Obligations.  With respect to
each Service for which the third party to the Run-Out Obligations has
non-exclusive rights as a service provider, if Regal has provided LLC with
written notice of Regal’s intent to receive additional equity in LLC with
respect to the Encumbered Theatres pursuant to the Unit Adjustment Agreement,
Regal shall, until such Run-Out Obligations have terminated, pay LLC [***].  Any such payments shall be made on or before
the last day of LLC’s fiscal month following the fiscal quarter in which Regal
receives third party payment for the Services. 

(d)           Beverage
Agreement Advertising Rate and Encumbered Theatres.  If Regal has provided LLC with written notice
of Regal’s intent to receive additional equity in LLC with respect to the
Encumbered Theatres prior to termination of the Run-Out Obligations pursuant to
the Unit Adjustment Agreement, the attendance at Encumbered Theatres shall be
included in the calculation of the Beverage Agreement Advertising Rate.

Section 4.09         License.  LLC hereby grants to Regal and its Affiliates
a limited, non-exclusive, non-transferable, non-sublicenseable license in the
Theatres only (i) to receive, store, display and exhibit the Digital
Content Service, the Traditional Content Program and the Digital Carousel, as
applicable, on the LLC Equipment and the Regal Equipment solely in connection
with its performance of and subject to all of the terms and conditions of this
Agreement, and (ii) subject to LLC’s prior written consent, to prepare and
distribute promotional materials based, in whole or in part, on the Service
solely to the extent necessary to promote the Service as permitted in
Section 6.03 below.  Regal may not
alter intentionally the Digital Content Service, the Traditional Content
Program or the Digital Carousel or otherwise intentionally exhibit the Digital
Content Service, the Traditional Content Program or the Digital Carousel in a
manner resulting in a change to the Digital Content Service, Traditional
Content Program or Digital Carousel or any related on-screen Inventory, nor may
Regal use or make the Digital Content Service, Traditional Content Program or
Digital Carousel available for any purpose, at any location, or in any manner
not specifically authorized by this Agreement, including without limitation
recording, copying or duplicating the Digital Content Service, Traditional
Content Service or Digital Carousel or any portion thereof.  Regal shall at all times receive and exhibit
the Digital Content Service or Traditional Content Program and Digital Carousel
in accordance with such policies and procedures of LLC that are provided in
advance to Regal and consistently applied with respect to other exhibitors from
time to time.  Each Party shall be solely
responsible for obtaining and providing all rights, licenses, clearances and
consents necessary for the use of

 28
 

any Inventory it sources or creates (whether or not it sources or
creates such Inventory on behalf of the other Party), or that is prepared or
provided by third parties on its behalf, as contemplated herein, except as may
otherwise be agreed by the Parties in writing.

Section 4.10         Cooperation
and Assistance. 
The Parties agree that the effectiveness and quality of the Service as
provided by LLC are dependent on the cooperation and operational support of
both Parties.  

(a)           Regal.  Regal agrees that it (and each of the
Theatres) shall at all times during the Term provide LLC, at Regal’s own cost
except as otherwise provided in this Agreement, with the following:

(i)            internal resources and permissions
as reasonably required to effectuate delivery of the Service, including without
limitation projection and sound technicians and other employees to assist with
LLC Equipment installation and Digital Content Service, Digital Programming
Services and Meeting Services transmission;

(ii)           unless unavailable, 24 (hour) by
7 (day) “real time” access via Regal’s network assets in conformity with Regal’s
network use and security policies (provided in advance to LLC and consistently
applied with respect to other Regal service providers) to the in-Theatre
software and hardware components of the Digital Content Network, consistent
with the Service Level Agreements (as set forth in the Specification
Documentation), so that LLC can monitor the distribution and playback of the
Service and the Parties will reasonably cooperate to ensure that corrections or
changes are made as required to deliver the Service;

(iii)          detailed playback information in a
form, whether electronic or hard copy, and at such times as either Regal or LLC
shall reasonably request;

(iv)          prompt notification of reception,
playback or other technical problems associated with receipt of the Service;

(v)           the results of quality audits
performed by Regal periodically during the Term upon LLC’s request and at its
direction to confirm playback compliance; 

(vi)          adequate opportunities to train Regal
personnel, as provided in Section 3.06; 

(vii)         attendance data film-by-film,
rating-by-rating and Theatre-by-Theatre for all Theatres, in an electronic form
and in a format agreed by the Parties, at such times as are consistent with
Regal’s internal reporting systems but in any event at least weekly; 

(viii)        on a monthly, quarterly and annual basis
as requested by LLC from time to time, a list of all Theatres, including
(i) identification of which Theatres are Digitized Theatres, (ii) the
number of total screens and digital screens at each Theatre and for all
Theatres at which Advertising Services are provided, (iii) identification
of any Theatres that are not equipped with at least one Lobby Screen to display
the Video Display Program, (iv) attendance for screens on which
Advertising Services are provided (by Theatre and in total), including separate
identification of attendance for screens on which Advertising Services under
the

 29
 

Beverage Agreement is provided
(if different); (v) upon LLC’s request, identification of Theatres in
which Advertising Services are not provided, and the attendance and number of
screens at such theatres; (vi) estimated Theatre opening and closing
dates; and (vii) such other information described in the Specification
Documentation, as such may be amended from time to time by mutual agreement of
the Parties;

(ix)           Regal’s budgeted attendance by
theatre (and by month if Regal budgets on a monthly basis) for the next full
fiscal year once approved by Regal’s board, and; and

(x)            such other information regarding the
Services as LLC may reasonably request from time to time, as Regal agrees to
provide in its sole discretion;

(b)           LLC.  LLC agrees that it shall at all times during
the Term provide Regal, at LLC’s own cost except as otherwise provided in this
Agreement, with the following:

(i)            on a weekly basis, a report of
compliance by each Digitized Theatre with on-screen advertising requirements
and reasons for any noncompliance, including a report of compliance relating to
the Beverage Agreement (the “Beverage Compliance Report”); 

(ii)           on a weekly basis, a representative
Play List of national advertising, which LLC shall make available no later than
two business days prior to the day on which the Play List be implemented;

(iii)          on a monthly basis, a report regarding
local advertising.

(c)           Confidentiality.  For the avoidance of doubt, information made
available subject to this Section 4.10 shall be subject to the provisions
of Section 14.01 (Confidential Treatment); provided  however,
that LLC agrees that Regal shall be permitted to provide the Beverage
Compliance Report to its beverage concessionaire.  Regal agrees to be included in any compliance
reporting LLC provides to its advertisers and other content providers for proof
of performance.

Section 4.11         Trailers.
Trailers that are exhibited in the Theatres shall not include the exhibition or
display of any trademark, service mark, logo or other branding of a party other
than the film studio(s), distributor(s), production company(ies); provided,
however, Trailers may include incidental images of products or services
which appear in the motion picture (e.g., product placements).

Section 4.12         Customer
Access to Pre-Feature Program.  Regal shall use commercially reasonable
efforts to provide audiences access to the Theatre auditorium for the Pre-Feature
Program or Traditional Content Program not less than 20 minutes prior to
Showtime. 

Section 4.13         Excluded
Theatres; IMAX Screens.

(a)           Excluded
Theatres.  Regal shall have the right
to designate art house and draft house theatres that for purposes of this
Agreement shall be “Excluded Theatres”; provided, however, that
the aggregate annual attendance at all such Excluded Theatres on the date of

 30
 

designation shall not exceed four (4) percent of the aggregate annual
attendance at the Theatres.  The list of
Excluded Theatres identified as of the Effective Date is set forth in the
Specification Documentation.  Regal shall
provide written or electronic notice to LLC, in the form specified by LLC, each
time there is a change in its list of Excluded Theatres.  Excluded Theatres shall not be deemed Theatres
for purposes of this Agreement; provided, however, that upon
mutual agreement of the Parties one or more Excluded Theatres may participate
in Digital Programming Services and Meeting Services pursuant to Article 6.  Excluded Theatres will not receive
Advertising Services; provided, however, that upon mutual
agreement of the Parties one or more Excluded Theatres may participate in Event
Sponsorships with respect to a particular event included in the Digital Programming
Services.  Excluded Theatres will not be
considered for purposes of the calculation of Theatre Access Fees (although
Regal will be entitled to the revenue share allocable for Digital Programming
and Meeting Services events in Excluded Theatres, as set forth in Exhibit B).  Notwithstanding the foregoing, Excluded
Theatres will be subject to the exclusivity obligations of Regal, as set forth
in Section 2.04 to the same extent as a Theatre hereunder.  With respect to any Theatre subsequently
designated as an Excluded Theatre, the parties will negotiate in good faith
terms for the discontinuation of delivery of the Service to such Excluded
Theatre.

(b)           IMAX
Screens.  All Theatre screens
dedicated to the exhibition of films using “IMAX” technology shall be deemed “IMAX
Screens.” IMAX Screens will not receive, and Regal will have no duty to exhibit
on any IMAX Screen, the Digital Carousel, the Pre-Feature Program or the
Traditional Content Program; provided  however, that Regal may
elect to exhibit the Digital Carousel, the Pre-Feature Program or the
Traditional Content Program on its IMAX Screens in its sole discretion.  Notwithstanding the foregoing, all IMAX
Screens will be subject to the exclusivity obligations of Regal, as set forth
in Section 2.04 to the same extent as a Theatre hereunder.  Regal will provide LLC prompt written or
electronic notice, in the form specified by LLC, of any additions to or
deletions from its list of IMAX Screens, which list is provided in the
Specification Documentation.  

Section 4.14         Grand
Openings; Popcorn Tubs; Employee Uniforms.  Notwithstanding anything herein to the
contrary, Regal shall not be prohibited from: 
(i) promoting the grand opening of a Theatre or an Excluded
Theatre, provided such promotional activity (A) may occur only for the
fourteen (14) day period immediately preceding the opening of the theatre to
the general public through the fourteen (14) day period immediately following
the opening of the theatre to the general public, and (B) includes local
advertising of such opening in exchange for the advertising of local businesses
only, provided any on-screen advertising related thereto shall be subject to
availability of on-screen Inventory and limited to one (1) advertisement thirty
(30) seconds in length; (ii) placing advertising promoting full-length
feature films on special popcorn tubs (such as plastic or oversized containers
not regularly sold by Regal) sold in Theatres or Excluded Theatres, provided
Regal shall (A) provide LLC one hundred twenty (120) days prior notice of
Regal’s desire to conduct such promotion and permit LLC sixty (60) days to sell
promotional advertising for such special popcorn bags/tubs, and if LLC cannot
sell advertising for such special popcorn tubs within such sixty (60) day period
then Regal shall have the right to sell such advertising, (B) be limited
to two (2) such promotions in any twelve (12) month period during the Term,
(C) not conduct any such promotion over a period exceeding thirty (30)
days, and (D) not sell such advertising below the lowest total rate card
amount received by LLC for popcorn bags; and (iii) allowing advertising
for the supplier of

 31
 

Regal employee uniforms to appear on such uniforms, provided not more
than two (2) individual instances of such advertising may appear on any such
uniform at any one time.  Regal will
provide LLC reasonable advance written notice of any promotion under this
Section 4.14 (collectively, “Special Promotions”) and LLC will have the
right to approve each such Special Promotion. 
LLC may not unreasonably withhold, condition or delay its approval,
provided that LLC shall be permitted to withhold its approval from any such
Special Promotion that is inconsistent with any exclusive obligation of LLC
then in force, or otherwise interferes with the current or proposed business
activities of LLC as reasonably determined by LLC.  Any cash consideration paid by a third party
in connection with a Special Promotion relating to any Service shall be paid to
LLC.

Section 4.15         Consultation
regarding Certain Advertising Agreements. 

(a)           Theatre
Advertising.  Prior to either Party
entering into an exclusive agreement for longer than one Flight with any third
party for Theatre Advertising, the contracting Party will give the other Party
written notice not less than twenty (20) days in advance of the contract
date, and the Parties will consult in good faith to confirm that such exclusive
arrangement does not conflict with any exclusive arrangements the other Party
has entered into or contemplates entering into; provided  however,
this notice shall not apply to entry into the Beverage Agreement by Regal.  Notwithstanding the foregoing, if the Parties
have satisfied the foregoing provisions of this Section 4.15(a) and
identified a conflict of interest regarding an agreement with exclusivity,
Regal’s exclusivity interests shall prevail.

(b)           Strategic
Relationships.  Regal shall not enter
into any Strategic Relationship that conflicts with any existing or proposed
exclusive advertising or promotional arrangement between LLC and a third party
for which LLC has provided prior written notice, which may be by electronic
mail, to Regal’s designated representative(s) of such existing or proposed
exclusive arrangement, including the identity of the other party, the length of
time, and type of category of such exclusive arrangement, and specifically in
connection with a proposed exclusive arrangement the anticipated start date of
such arrangement.  Regal may enter into
any Strategic Relationship that conflicts with a proposed exclusive arrangement
prior to the anticipated start date of such arrangement.  Further, in the event that LLC is unable to
enter into a definitive agreement with respect to such proposed exclusive
arrangement within sixty (60) days after such notice by LLC to Regal of such
proposed exclusive arrangement, which notice may not be provided more than once
in any twelve month period, then Regal shall have the right to enter into any
such Strategic Relationship.

ARTICLE
5

SUPPORT; MAKE GOODS

Section 5.01         Software
Support. 
LLC reserves the right to request of Regal and agrees to consult with
Regal during the Term on any proposed material changes or updates to the
Software.  LLC shall make available to
Regal pursuant to the terms of the license in Section 7.01 below all such
updates or modifications to the Software. 
Unless otherwise agreed to in writing by LLC, Regal shall not permit any
third party to perform or provide any maintenance or support services with
respect to the LLC Equipment or the Software.

 32
 

Section 5.02         Cooperation.  Regal agrees to take all actions during the
Term that are within its control and reasonably necessary to permit the
delivery, exhibition and viewing of the Service in the Theatres on the terms
and conditions set forth herein.

Section 5.03         Make
Goods.  In
the event that any Inventory scheduled for exhibition pursuant to
Sections 4.06(a), 4.06(b) or 4.07 is not exhibited as scheduled, LLC shall
take such action or provide such remedy as is required pursuant to the
applicable Regal advertising agreement, including the exhibition of “make good”
Inventory sufficient to achieve the level of Inventory content impressions
necessary to satisfy any contractual obligations governing the exhibition of
such Inventory.  Regal acknowledges and agrees
that such contractual obligations must have been timely disclosed to LLC in
writing as a condition to the exercise of the foregoing exclusive right and
remedy; such obligations as of the Effective Date have been provided by Regal
to LLC in a separate letter.  To the
extent such third-party agreement prescribed a “make good” remedy, Regal agrees
to make its Theatres (including screens and Lobby Screens, as applicable)
available for the exhibition of such “make goods,” and LLC agrees to exhibit
such “make goods” consistent with any contractual obligations of Regal
concerning the exhibition of such “make goods.” LLC reserves the right to use
excess or unsold Inventory as “make goods,” remnant advertising, other revenue
generating advertising, public service announcements, and the like.  Notwithstanding the foregoing, LLC shall only
be required to make any payment of moneys (including a refund of amounts paid
by the applicable advertiser) in the event that the reason that the applicable
Inventory was not exhibited or was exhibited in an incorrect position was
primarily a result of actions or inactions by LLC (or its designees or assigns)
and the applicable advertising agreement does not allow, or LLC otherwise does
not provide, a remedy of exhibition of “make good” Inventory.

ARTICLE
6

DIGITAL PROGRAMMING SERVICES AND MEETING
SERVICES

Section 6.01         Participation
in Digital Programming.  All Digitized Theatres with the necessary
equipment to exhibit an event are available for Digital Programming Services
either automatically or subject to Regal’s approval, based on criteria
specified in Exhibit B.  The
Parties agree that Regal will pay LLC a percentage of ticket revenue as set
forth on Exhibit B for Digital Programming Services described on Exhibit A,
Section B.  

Section 6.02         Participation
in Meeting Services.  Regal shall make its Theatres available for
Meeting Services either automatically or subject to Regal’s approval, based on
criteria specified in Exhibit B. 
The Parties agree that Regal will be compensated for use of its
auditoriums as set forth on Exhibit B for the Meeting Services as
described on Exhibit A, Section C.  

Section 6.03         Marketing
and Promotion of Digital Programming Services and Meeting Services.  

(a)           The
Parties have agreed to develop and implement a plan to market and promote the
Digital Programming Services to current and potential Theatre patrons on an
event-by-event basis.  This marketing
plan will include at least one digital trailer (the “Event Trailer”) 

 33
 

to promote events or a series of events distributed to the applicable
Digitized Theatres and other Digitized Theatres in the designated market
area.  If LLC is promoting only one
Digital Programming event, the relevant Event Trailer shall not be longer than
thirty (30) seconds, and if LLC is promoting more than one Digital Programming
event, the aggregate time of the Event Trailers shall not exceed
40 seconds.  The Event Trailer shall
be limited to a promotion for an applicable event and if displayed after
Showtime shall not include any (i) product placement or mention nor
(ii) logo placement, except for company names and logos that are
incidental to the sponsoring of such event, without the prior written approval
of Regal which approval shall not be unreasonably withheld.  Notwithstanding the foregoing, Regal shall,
in its discretion, determine whether and in which Theatres to exhibit an Event
Trailer after Showtime.  If Regal chooses
not to display the Event Trailer after Showtime in all Theatres in the
designated market area where Regal is exhibiting the Digital Programming event,
LLC may refuse to distribute the Digital Programming event to any of Regal’s
Theatres in such designated market area.

(b)           LLC
may request access to Regal’s customer databases, in connection with marketing of
Digital Programming Services events, which request may be denied in Regal’s
sole and absolute discretion.

(c)           Marketing
and promotion materials created for Digital Programming Services and Meeting
Services shall be created as mutually agreed from time to time, in accordance
with the content standards set forth in Section 4.03.  LLC agrees to include bridges and bumps,
prior to and following a Digital Programming Services event, to reinforce
branding for the Digital Programming Service.

Section 6.04         Concessions,
Sponsorships. 
Regal shall retain all revenue from Concession sales associated with
Digital Programming Services and Meeting Services.  LLC reserves the right, as part of the
Advertising Services, to arrange third party sponsorship of Digital Programming
Services and Meeting Services, provided that no such sponsor may be a
theatre or theatre circuit which is a competitor of Regal, and provided
that such sponsorship is in conformance with the content restrictions
enumerated in Section 4.03(i) through (ix) hereof.  

Section 6.05         LLC’s
First Right. 
Regal will submit to LLC for consideration by LLC any event
opportunities that are identified by or presented to Regal and that would
ordinarily fall within the definition of Digital Programming Services and
Meeting Services.  Should LLC elect not
to enter into a contract for such events in the Digital Programming Services or
Meeting Services within 30 days after such submission by Regal, then Regal
may pursue such event opportunities independent of LLC, and Regal shall retain
any and all revenues resulting from such event. 
LLC agrees to keep Regal informed of the progress in negotiating any
contract for such events referred by Regal.

Section 6.06         Digital
Programming Content.  When sourcing digital content programming for
Digital Programming Services and Meeting Services, LLC agrees to exercise
commercially reasonable efforts to source content from a variety of
providers.  Such content must have
received, or be such that, had it been rated, it would have received, an MPAA
rating of “G,” “PG,” “PG-13” or “R” (or the equivalent).  

 34
 

Section 6.07         Use
of Digital Content Network.  Regal shall have the right to use the Digital
Content Network for the delivery of (a) any Digital Films, Trailers or PSA
Trailer, and (b) any event submitted to, and rejected by, LLC pursuant to
Section 6.05, and Regal shall pay LLC an Administrative Fee for such use
as set forth in Exhibit B. 

ARTICLE
7

INTELLECTUAL PROPERTY

Section 7.01         Software
License. 
Subject to the terms and conditions of this Agreement and the License
Agreement, LLC hereby grants to Regal, and Regal hereby accepts, a
non-exclusive, non-transferable, non-sublicenseable, limited license to install
and execute the object code version of the Software solely for the limited
purpose to receive, store, display and exhibit the Digital Content Service, the
Traditional Content Program and the Digital Carousel, as applicable, on the LLC
Equipment and the Regal Equipment solely in connection with its performance of
and subject to all of the terms and conditions of this Agreement and only to
the extent such Software is utilized by Regal.

Section 7.02         License
of the LLC Marks.  

(a)           Subject
to the terms and conditions of this Agreement and any guidelines or
requirements provided in writing from time-to-time by LLC to Regal, LLC hereby
grants at no additional cost to Regal, and Regal hereby accepts, a
non-exclusive, non-transferable (except in connection with an assignment of
this Agreement in accordance with Section 15.08 hereof), nonsublicenseable,
limited license (i) to use the LLC Marks solely in connection with its
participation in the Service, as approved by LLC in writing in advance (which
shall not be unreasonably or untimely withheld), and (ii) to use the LLC
Marks in marketing or advertising materials (“Marketing Materials”) that have
been approved (which shall not be unreasonably or untimely withheld) by LLC
pursuant to the terms hereof, provided and to the extent LLC shall have
authorized Regal to promote the Service. 
Regal acknowledges that LLC is and shall remain the sole owner of the
LLC Marks, including the goodwill of the business symbolized thereby.  Regal recognizes the value of the goodwill
associated with the LLC Marks and acknowledges and agrees that any goodwill arising
out of the use of the LLC Marks or any of them by Regal shall inure to the sole
benefit of LLC for all purposes hereof.

(b)           Prior
to using any Marketing Material or depicting or presenting any LLC Mark in or
on any marketing or advertising material or otherwise, Regal shall submit a
sample of such Marketing Material or other material to LLC for approval.  LLC shall exercise commercially reasonable
efforts to approve (which shall not be unreasonably withheld) or reject any
such Marketing Material or other material submitted to it for review within
five (5) business days from the date of receipt by LLC.  Regal shall not use, publish, or distribute
any Marketing Material or other material unless and until LLC has so approved
it in writing.  Upon receipt of such
approval from LLC for a particular Marketing Material or other material, Regal
shall not be obligated to submit to LLC substantially similar material for
approval; provided, however, Regal shall timely furnish samples
of all such material to LLC.

(c)           Any
and all use or exercise of rights by Regal with respect to the LLC

 35
 

Marks or any other trademark, tradename, service mark or service name
provided by LLC to Regal for use in connection with the Services shall be in
accordance with standards of quality and specifications prescribed by LLC from
time to time (the “LLC Quality Standards”) and which have been delivered to
Regal.  LLC shall have the right to
change the LLC Quality Standards from time to time upon written notice to
Regal, provided such modified LLC Quality Standards are equally and timely
applied to any and all other exhibitors of the Service.

(d)           Regal
shall cause the appropriate designation “(TM)” or “(SM)” or the registration
symbol “(R)” to be placed adjacent to the LLC Marks in connection with the use
thereof and to indicate such additional or alternative information as LLC shall
specify from time to time concerning the use by Regal of the LLC Marks as such
is, equally and timely communicated and applied to any and all other exhibitors
of the Service.

(e)           Regal
shall not use any LLC Mark in any manner that may reflect adversely on the
image or quality symbolized by the LLC Mark, or that may be detrimental to the
image or reputation of LLC. 
Notwithstanding anything herein to the contrary, LLC shall have the
right, at its sole option, to terminate or suspend the trademark license grant
provided herein if it determines that Regal’s use of the LLC Marks or any of
them is in violation of its trademark usage guidelines or is otherwise disparaging
to its image or reputation, and such use is not conformed to such guidelines
and other reasonable requests of LLC within ten (10) days of receipt of written
notice thereof.

(f)            Regal
agrees not to use (i) any trademark or service mark which is confusingly
similar to, or a colorable imitation of, any LLC Mark or any part thereof,
(ii) any trademark or service mark in combination with any LLC Mark,
except in the case of the Brand as created by LLC under the terms of Section
4.05(b) or (iii) any LLC Mark in connection with or for the benefit of any
product or service of any other Person or entity, except in the case of the
Brand as created by LLC under the terms of Section 4.05(b).  Regal shall not engage in any conduct which
may place LLC or any LLC Mark in a negative light or context, and shall not
represent that it owns or has any interest in any LLC Mark other than as
expressly granted herein, nor shall it contest or assist others in contesting
the title or any rights of LLC (or any other owner) in and to any LLC Mark.

(g)           With
respect to all of LLC’s approvals, rights and otherwise under this
Section 7.02, LLC shall treat Regal at least as favorably with respect to
each instance as it has for any other exhibitor of the Service.

Section 7.03         License
of the Regal Marks.  

(a)           Subject
to the terms and conditions of this Agreement, and any guidelines or
requirements provided in writing from time-to-time by Regal to LLC, Regal
hereby grants at no cost to LLC, and LLC hereby accepts, a non-exclusive,
non-transferable (except in connection with an assignment of this Agreement in
accordance with Section 15.08 hereof), nonsublicenseable, limited license
(i) to use the Regal Marks solely in connection with its delivery of the
Service, as approved (which shall not be unreasonably or untimely withheld) by
Regal in writing in advance, and (ii) to use the Regal Marks in Marketing
Materials that have been approved (which shall not be unreasonably or untimely
withheld) by Regal pursuant to the

 36
 

terms hereof.  LLC acknowledges
that Regal is and shall remain the sole owner of the Regal Marks, including the
goodwill of the business symbolized thereby. 
LLC recognizes the value of the goodwill associated with the Regal Marks
and acknowledges and agrees that any goodwill arising out of the use of the
Regal Marks by LLC shall inure to the sole benefit of Regal for all purposes
hereof.

(b)           Prior
to using any Marketing Material or depicting or presenting any Regal Mark in or
on any marketing or advertising material or otherwise, LLC shall submit a
sample of such Marketing Material or other material to Regal for approval.  Regal shall exercise commercially reasonable
efforts to approve (which shall not be unreasonably withheld) or reject any such
Marketing Material or other material submitted to it for review within five (5)
business days from the date of receipt by Regal LLC shall not use, publish, or
distribute any Marketing Material or other material unless and until Regal has
so approved it in writing.  Upon receipt
of such approval from Regal for a particular Marketing Material or other
material, LLC shall not be obligated to submit to Regal substantially similar
material for approval; provided, however, LLC shall timely
furnish samples of all such material to Regal.

(c)           Any
and all use or exercise of rights by LLC with respect to the Regal Marks or any
other trademark, tradename, service mark or service name provided by Regal to
LLC for use in connection with the Services shall be in accordance with
standards of quality and specifications prescribed by Regal from time to time
(the “Regal Quality Standards”) and provided to LLC.  Regal shall have the right to change the
Regal Quality Standards from time to time upon written notice to LLC.

(d)           LLC
shall cause the appropriate designation “(TM)” or “(SM)” or the registration
symbol “(R)” to be placed adjacent to the Regal Marks in connection with the
use thereof and to indicate such additional or alternative information as Regal
shall specify from time to time concerning the use by LLC of the Regal Marks as
such is equally and timely communicated and applied to any and all other
licensees of the Regal Marks.

(e)           LLC
shall not use any Regal Mark in any manner that may reflect adversely on the
image or quality symbolized by the Regal Mark, or that may be detrimental to
the image or reputation of Regal. 
Notwithstanding anything herein to the contrary, Regal shall have the
right, at its sole option, to terminate or suspend the trademark license grant
provided herein if it determines that LLC’s use of the Regal Marks or any of
them is in violation of its trademark usage guidelines or is otherwise
disparaging to its image or reputation, and such use is not conformed to such
guidelines and other reasonable requests of Regal within ten (10) days of
receipt of written notice thereof.

(f)            LLC
agrees not to use (i) any trademark or service mark which is confusingly
similar to, or a colorable imitation of, any Regal Mark or any part thereof,
(ii) any trademark or service mark in combination with any Regal Mark,
except for the LLC Marks as permitted under this Agreement or (iii) any
Regal Mark in connection with or for the, benefit of any product or service of
any other Person or entity, except for the LLC Marks as permitted under this
Agreement.  LLC shall not engage in any
conduct which may place Regal or any Regal Mark in a negative light or context,
and shall not represent that it owns or has any interest in any Regal Mark
other than as expressly granted herein, nor shall it contest or assist others in

 37
 

contesting the title or any rights of Regal (or any other owner) in and
to any Regal Mark.

Section 7.04         Status
of the LLC Marks and Regal Marks.  Without expanding the rights and licenses
granted under this Agreement, the Parties acknowledge and agree that
(a) the rights and licenses granted under this Agreement to use the LLC
Marks and Regal Marks permit the use of the Regal Marks in combination or
connection with the LLC Marks, (b) the use of
the Regal Marks in combination or connection with the LLC Marks, whether in the
Brand, Policy Trailer, Branded Slots, Marketing Materials or otherwise in
connection with the participation in or delivery of the Service, will not be
deemed to create a composite or combination mark consisting of the Regal Marks
and the LLC Marks, but instead will be deemed to create and will be treated by
the Parties as creating a simultaneous use of the LLC Marks and Regal Marks as
multiple separate and distinct trademarks or service marks, (c) neither Party
will claim or assert any rights in a composite mark consisting of elements of
the LLC Marks and Regal Marks, and (d) all use of the Regal Marks and the LLC
Marks under this Agreement will be subject to the provisions regarding the use
and ownership of the Regal Marks and LLC Marks contained in this
Agreement.  

ARTICLE
8

FEES

Section 8.01         Payment.  Except as otherwise provided in this
Agreement (e.g., payment of the Theatre Access Fees pursuant to
Section 2.05(b)), all amounts due by one Party to the other under this
Agreement shall be paid in full within thirty (30) days after the receipt by
the paying Party of an invoice therefor. 
Each Party agrees that invoices for amounts payable by the other Party
will not be issued until the event triggering such payment obligation has
occurred, or the condition triggering such payment obligation has been
satisfied, as applicable.

Section 8.02         Audit.  Each Party shall keep and maintain accurate
books and records of all matters relating to the performance of its obligations
hereunder, including without limitation the sale of advertising, in accordance
with generally accepted accounting principles. 
During the Term and for a period of one (1) year thereafter, each Party,
at its sole expense, shall, upon reasonable advance written notice from the other
Party, make such books and records (redacted, as applicable, to provide
information relative to the Service and this Agreement) available at its
offices for inspection and audit by the other Party, its employees and agents.  Any audit with respect to amounts payable by
either Party to the other Party under this Agreement shall be limited to an
audit with respect to amounts to be paid in the current calendar year and
immediately preceding calendar year only. 
Any period that has been audited pursuant to this section shall not be
subject to any further audit.  In the
event an audit of the books and records of a Party reveals an underpayment to
the other Party, the audited Party shall pay to the other Party the amount of
such underpayment within 30 days of the completion of the audit.  If such audit determines that the underage in
payments paid to a Party were in the aggregate in excess of five percent (5%)
of the payments owed, the Party owing the payment shall, in addition to making
the payment set forth above, reimburse the Party receiving the payment for all
reasonable costs, expenses and fees incurred in connection with such
audit.  Any disputes between the Parties
relating to the calculation of amounts owed shall be referred to a mutually
satisfactory independent public accounting firm that has not been employed by
either Party for the two (2) 

 38
 

year period immediately preceding the date of such referral.  The determination of such firm shall be
conclusive and binding on each Party, and judgment upon any such determination
can be entered in any court having jurisdiction over the matter.  Each Party shall bear one-half of the fees of
such firm.  If the Parties cannot select
such accounting firm, then the selection of such accounting firm shall be made
by the American Arbitration Association located in New York, New York.  In addition to the foregoing audit rights of
the Parties, during the Term LLC and its authorized agents shall have the
right, upon reasonable advance notice, to inspect any Regal premises or
facilities involved in the performance of this Agreement to confirm the
performance and satisfaction of Regal’s obligations hereunder.

ARTICLE
9

TERM AND TERMINATION

Section 9.01         Term.

(a)           Duration.  Unless earlier terminated as provided below,
the term of this Agreement, except with respect to Digital Programming Services
and Meeting Services, shall begin on the Effective Date and shall continue
through February 13,  2037 (the “Initial
Term”), after which Regal shall have the right to renew this Agreement on the
terms as set forth in this Agreement for continuous, successive five-year
periods (each, a “Renewal Term,” and together with the Initial Term, the “Term”).  Regal shall give LLC written notice of any
intent to exercise its right to renew at least thirty (30) days prior to the
expiration of the Initial Term and any Renewal Term.  The Parties shall, for a period of six (6)
months commencing eighteen (18) months before the conclusion of the Initial
Term and any Renewal Term, negotiate in good faith terms, if any, on which they
may agree to extend the Initial Term or any Renewal Term, and, if such
agreement is reached, this Agreement shall be amended to incorporate such
terms.  Unless this Agreement is extended
by Regal, this Agreement may only be extended by subsequent written agreement
of the Parties.  Prior to and during such
six (6) month period, Regal shall not enter into or conduct any negotiations
with any third party with respect to any service that may be competitive with
the Service or any feature thereof.

(b)           Digital
Programming Services.  The term of
this Agreement with respect to Digital Programming Services shall begin on the
Effective Date and shall continue through December 31, 2011 (the “Initial
Digital Programming Term”).  This Agreement
shall automatically renew with respect to Digital Programming Services for
continuous, successive five-year periods (each, a “Digital Programming Renewal
Term,” and together with the Initial Digital Programming Term, the “Digital
Programming Term”) if Digital Programming Services has produced an average
Digital Programming EBITDA (as defined in Schedule 1) per Founding Member
screen in all Theatres, AMC Theatres and Cinemark Theatres of $[***] for the
three year period ending on December 31, 2011 with respect to the
Initial Digital Programming Term or has produced an average Digital
Programming EBITDA per Founding Member screen of $[***] increased by 5% for
each five year period thereafter with respect to any Digital Programming
Renewal Term (the “Digital Programming EBITDA Threshold”); provided, however,
that the Digital Programming Term shall not exceed the Initial Term.  If Digital Programming Services has failed to
satisfy the Digital Programming EBITDA Threshold, then Regal may extend the
Initial Digital Programming Term or any Digital Programming Renewal

 39
 

Term at its sole discretion.  Notwithstanding the preceding
sentence, if upon expiration of the Initial Digital Programming Term or any
Digital Programming Renewal Term, the average Digital Programming EBITDA (as
defined in Schedule 1) per Founding Member screen for Digital Programming
Services was negative during the last two years of such Initial Digital
Programming Term or any two of the five years of such Digital Programming
Renewal Term, then either Regal or LLC shall have the right in its sole
discretion to not extend the Initial Digital Programming Term or any
Digital Programming Renewal Term.  Upon expiration of the Digital
Programming Term, the provisions of this Agreement relating to Digital
Programming shall terminate, except such rights and obligations that may
survive pursuant to Section 9.04 (including the survival of Section 9.03 if the
Digital Programming Term continues until the expiration of this Agreement).

(c)           Meeting
Services.  The term of this Agreement
with respect to Meeting Services shall begin on the Effective Date and shall
continue through December 31, 2011 (the “Initial Meeting Services Term”).  This Agreement shall automatically renew with
respect to Meeting Services for continuous, successive five-year periods (each,
a “Meeting Services Renewal Term,” and together with the Initial Meeting
Services Term, the “Meeting Services Term”) if Meeting Services has produced
an average Meeting Services EBITDA (as defined in Schedule 1) per Founding
Member screen in all Theatres, AMC Theatres and Cinemark Theatres of $[***] for
the three year period ending on December 31, 2011 with respect to the
Initial Meeting Services Term or has produced an average Meeting Services
EBITDA per Founding Member screen of $[***] increased by 5% for each five
year period thereafter with respect to any Meeting Services Renewal Term
(the “Meeting Services EBITDA Threshold”); provided, however,
that the Meeting Services Term shall not exceed the Initial Term.  If Meeting Services has failed to satisfy the
Meeting Services EBITDA Threshold, then Regal may extend the Initial Meeting
Service Term or any Meeting Services Renewal Term at its sole discretion. 
Notwithstanding the preceding sentence, if upon expiration of the Initial
Meeting Services Term or any Meeting Services Renewal Term, the average EBITDA
per Founding Member screen for Meeting Services was negative during the
last two years of such Initial Meeting Services Term or any two of the five
years of such Meeting Services Renewal Term, then either Regal or LLC
shall have the right in its sole discretion to not extend the Initial
Meeting Services Term or any Meeting Services Renewal Term.  Upon expiration of the Meeting
Services Term, the provisions of this Agreement relating to Meeting Services
shall terminate, except such rights and obligations that may survive pursuant
to Section 9.04 (including the survival of Section 9.03 if the Meeting Services
Term continues until the expiration of this Agreement).

Section 9.02         Termination;
Defaults. 
Either Party may terminate this Agreement, immediately, by giving
written notice of termination to the other, and without prejudice to any other
rights or remedies the terminating Party may have, if:

(a)           Breach
of Material Provision.  The other
Party materially breaches this Agreement, other than any provision of
Section 15.08, and fails to cure such breach within ninety (90) days after
receipt from the terminating Party of written notice of the breach specifying
in detail the nature of the breach, provided, that if such material breach
cannot be cured within ninety (90) days from the notice, then the ninety-day
period shall be extended as long as is reasonably necessary to cure such breach
if the Party receiving notice diligently attempts to cure

 40
 

such breach; and provided, further, that if any such breach by Regal is
confined to a Theatre or limited number of Theatres, LLC shall have the right
in its sole discretion to terminate this Agreement only as to such Theatre or
Theatres.

(b)           Breach
of Anti-Assignment Provision.  The
other Party materially breaches any provision of Section 15.08, and fails
to cure such breach within thirty (30) business days after receipt from the
terminating Party of written notice of the breach; provided, that if such
breach cannot be cured within thirty (30) business days from the notice, then
the period of thirty business days shall be extended as long as is reasonably
necessary to cure such breach if the Party receiving notice diligently attempts
to cure such breach; and provided, further, that if any such breach by Regal is
confined to a Theatre or limited number of Theatres, LLC shall have the right
in its sole discretion to terminate this Agreement only as to such Theatre or
Theatres.

(c)           Injunction,
Order or Decree.  Any governmental,
regulatory or judicial entity of competent jurisdiction shall have issued a
permanent injunction or other final order or decree which is not subject to
appeal or in respect of which all time periods for appeal have expired,
enjoining or otherwise preventing LLC or, Regal from performing, in any
material respect, this Agreement.

(d)           Bankruptcy.  The dissolution, bankruptcy, insolvency or
appointment of a receiver or trustee of the other Party that is not dismissed
within sixty (60) days, or the other Party convenes a meeting of creditors, has
a receiver appointed, ceases for any reason to carry on business or is unable
to pay its debts generally.

Section 9.03         Right
of First Refusal. 

(a)           ROFR
Period.  For a period (the “ROFR
Period”) beginning 12 months prior to the end of the scheduled expiration
of this Agreement pursuant to Section 9.01 and ending 48 months after
expiration of this Agreement, Regal shall not enter into any agreement or
arrangement with a third party (whether in writing or otherwise) (an “Alternative
Agreement”) to receive services that were being provided by LLC to Regal at any
time during the one-year period ending on expiration of this Agreement (“Designated
Services”) without complying with this Section 9.03.

(b)           ROFR
Notice.  Before entering into or
committing to enter into an Alternative Agreement, Regal shall present to LLC
notice (the “ROFR Notice”) containing a summary of all material terms and
conditions of the proposed Alternative Agreement.  The ROFR Notice shall state that Regal
intends to enter into the Alternative Agreement and shall certify that there
are no other direct or indirect arrangements or understandings with respect to
the provision of the Designated Services that have not been disclosed to LLC.

(c)           Information
Request.  Regal shall provide LLC
such additional and supplemental information as LLC shall reasonably request
within 10 days of receiving such request and Regal shall cooperate fully
with LLC in its evaluation of the Alternative Agreement.

(d)           ROFR
Response.  LLC shall have the right
during a period ending 90 days after submission of the Alternative
Agreement (or in the event additional information is requested by LLC, within
90 days after the final submission to LLC of such additional

 41
 

information) (the “ROFR Response Period”) to give Regal written notice
(the “ROFR Response”) that it either (i) will enter into an agreement with
Regal providing Regal with the Designated Services on terms and conditions no
less favorable to Regal than those contained in the Alternative Agreement or
(ii) does not seek to provide the Designated Services.

(e)           Negotiation
regarding Portion of Designated Services. 
If any of the Designated Services to be provided by the Alternative
Agreement cannot reasonably be provided by LLC, then LLC and Regal shall
negotiate in good faith during the ROFR Response Period as to LLC’s ability to
provide certain portions of the Designated Services; provided that should
(x) Regal and LLC fail to reach agreement on LLC’s provision of the
Designated Services in part and (y) LLC fails to agree to provide all of
the Designated Services by the end of the ROFR Response Period, then Regal
shall be permitted to enter into the Alternative Agreement on terms no less favorable
to Regal than those set forth in the ROFR Notice as provided in
Section 9.03(b) above.  If Regal
fails to enter into such Alternative Agreement within 45 days after the
end of the ROFR Response Period, then the procedures set forth in this
Section 9.03 shall once again become applicable.

(f)            Alternative
Proposals.  During the period
commencing on the date that Regal provides LLC the ROFR Notice and continuing
until the earlier of (i) the end of the ROFR Response Period and
(ii) the date LLC notifies Regal that it does not seek to provide the
Designated Services, Regal shall not solicit alternative proposals from any
other party for the Designated Services.

(g)           Agreement.  If either (i) LLC delivers a ROFR
Response indicating that LLC wants to provide Regal with the Designated
Services on the terms and conditions set forth in the ROFR Notice or
(ii) the Parties agree that LLC will provide only certain of the
Designated Services, the Parties will, within 45 days of such verbal
agreement, enter into a written agreement to provide the agreed-on Designated
Services on such terms and conditions. 
If Regal and LLC fail to enter into such agreement within 45 days
after the end of the ROFR Response Period, then Regal shall have 45 days
thereafter to enter into the Alternative Agreement on the terms and conditions
no less favorable to Regal than those set forth in the ROFR Notice.  If Regal fails to enter into such Alternative
Agreement within such 45 day period, then the provisions of this
Section 9.03 shall once again become applicable.

(h)           Entry
into Alternative Agreement.  If
either (i) LLC delivers a ROFR Response indicating that LLC does not want
to provide Regal with the Designated Services on the terms and conditions set
forth in the ROFR Notice or (ii) the Parties agree that LLC will provide
only certain of the Designated Services, Regal shall be permitted, with respect
to those Designated Services not provided by LLC, to enter into the Alternative
Agreement on the terms and conditions no less favorable to Regal than those set
forth in the ROFR Notice.  If Regal fails
to enter into such Alternative Agreement within 45 days after the end of
the ROFR Response Period, then the provisions of this Section 9.03 shall
once again become applicable.

Section 9.04         Survival.  Articles 1, 10, 11, 13, 14 and 15 and
Sections 9.04, 9.05 and 9.06 shall survive any expiration or termination
of this Agreement, and Section 9.03 shall survive any expiration of this
Agreement.

 42
 

Section 9.05         Effect
of Termination. 
Upon termination or expiration of this Agreement, each Party may
exercise all remedies available to it as a matter of law and upon prior notice
to Regal, LLC shall be entitled to enter the Theatres, and any other premises
of Regal where any LLC Property may be located (or in the event of partial
termination of this Agreement pursuant to Section 9.02(a) or (b) the
affected Theatre(s) or premises), at a time mutually agreed to by the Parties
in order to recover any and all LLC Property. 
In the event LLC fails to recover any LLC Property within the timeframe
the Parties agree upon for such recovery, Regal shall have the right to remove
and dispose of such LLC Property in its sole discretion, provided that
any Software included in the LLC Property shall be recovered and returned to
LLC at LLC’s expense.  LLC shall be
obligated to restore all premises from which LLC Property is removed pursuant
to this section to their previous condition, excluding reasonable wear and tear
and any other improvements or material alterations to such premises as may have
been approved by the Parties in connection with installation of LLC Equipment
or operation of the Service and shall repair any damage to the premises as a
result of such removal.  In addition, any
and all licenses granted by either Party to the other under this Agreement
shall immediately terminate, Regal shall cease using LLC Marks, LLC shall cease
using Regal Marks and LLC shall be entitled to immediately discontinue the
Service.  Promptly upon termination or
expiration of this Agreement, and except as expressly provided in
Article 8 of the License Agreement, each Party shall return to the other
Party all Confidential Information of the other Party, or, at the other Party’s
option, destroy such Confidential Information and promptly provide to the other
Party a certificate signed by an officer of the Party attesting to such
destruction.  Notwithstanding termination
of this Agreement, each Party shall pay to the other, within thirty (30) days
after the effective date of such termination, any and all fees (including costs
and expenses) and other amounts owed hereunder as of such termination.

ARTICLE
10

REPRESENTATIONS, WARRANTIES AND COVENANTS

Section 10.01       Representations
and Warranties. 
Each Party represents and warrants that:

(a)           Formation.  It (i) is duly formed and organized,
validly existing, and in good standing under the laws of the jurisdiction of
its formation and incorporation and has the power and authority to carry on its
business as carried on, and (ii) has the right to enter into this
Agreement and to perform its obligations under this Agreement and has the power
and authority to execute and deliver this Agreement.

(b)           Governmental
Authorization.  Any registration,
declaration, or filing with, or consent, approval, license, permit or other
authorization or order by, any governmental or regulatory authority, domestic
or foreign, that is required to be obtained by it in connection with the valid
execution, delivery, acceptance and performance by it under this Agreement or the
consummation by it of any transaction contemplated hereby has been completed,
made, or obtained, as the case may be.

(c)           Consents.  It is the exclusive owner of, or otherwise
has or will have timely obtained all rights, licenses, clearances and consents necessary
to make the grants of

 43
 

rights made or otherwise perform its obligations under this Agreement
as required under this Agreement.

(d)           No
Conflicts.  The execution and
delivery of this Agreement do not, and the performance of its obligations under
this Agreement and the consummation of the transactions contemplated hereby
will not (with or without notice or lapse of time or both) (i) conflict
with or result in a violation or breach of its charter or other organizational
documents; (ii) conflict with or result in a violation or breach of any
law or order applicable to it, or (iii) (A) conflict with or result
in a violation or breach of, (B) constitute a default under, or
(C) result in the creation or imposition of any lien upon it or any of its
assets and properties under, any material contract or material license to which
it or any of its Affiliates is a party or by which any of its or their
respective assets and properties are bound.

Section 10.02       Additional
Covenants.  

(a)           No
Challenge.  Each Party covenants that
it will not at any time, except to the extent necessary to, assert or defend
its rights under this Agreement: 
(i) challenge or otherwise do anything inconsistent with the other
Party’s right, title or interest in its property, (ii) do or cause to be
done or omit to do anything, the doing, causing or omitting of which would
contest or in anyway impair or tend to impair the rights of the other Party in
its property or the rights of third party licensors or providers in their
property, or (iii) assist or cause any Person or entity to do any of the
foregoing.  

(b)           No
Infringement by Regal.  Regal
covenants that, except as Regal discloses in writing concurrently with the
execution hereof and excluding any intellectual property or other rights licensed
pursuant to the License Agreement, none of the information, content, materials,
or services it supplies or has supplied on its behalf under this Agreement to
its knowledge infringes or misappropriates, or will infringe or misappropriate,
any U.S. patent, trademark, copyright or other intellectual property or
proprietary right of any third party to the extent used in accordance with the
terms and conditions of this Agreement.

(c)           No
Infringement by LLC.  LLC covenants
that, except as specified in Section 10.02(b) and excluding any
intellectual property or other rights licensed pursuant to the License
Agreement, (i) to its knowledge, the Services will not violate, infringe
or dilute any trademark, tradename, service mark or service name or any other
intellectual property of any third party or the right of privacy or publicity
of any person and (ii) LLC shall procure any and all consents, licenses or
permits necessary relating to the Services provided to Regal and shall pay all
license fees and royalties to the appropriate parties that become due and owing
as a result of the performance of the Services or any other services as may be
provided by LLC to Regal from time to time, other than film rent to the film
distributors.

Section 10.03       Disclaimer.  EXCEPT AS EXPRESSLY AND EXPLICITLY SET FORTH
IN THIS AGREEMENT, ANY AND ALL INFORMATION, PRODUCTS, AND SERVICES, INCLUDING,
WITHOUT LIMITATION, THE REGAL PROPERTY AND LLC PROPERTY, ARE PROVIDED “AS IS”
AND “WITH ALL FAULTS,” AND NEITHER PARTY MAKES ANY REPRESENTATIONS OR
WARRANTIES, AND EACH PARTY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES,
EXPRESS OR IMPLIED,

 44
 

WRITTEN OR ORAL, ARISING FROM COURSE OF DEALING, COURSE OF PERFORMANCE,
USAGE OF TRADE, OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY, TITLE AND FITNESS FOR A
PARTICULAR PURPOSE.  NEITHER PARTY MAKES
ANY REPRESENTATION THAT THE DIGITAL CONTENT SERVICE OR ITS DISPLAY, OR RECEIPT
OF ANY OTHER SERVICES, WILL BE UNINTERRUPTED OR ERROR-FREE.

ARTICLE
11

INDEMNIFICATION

Section 11.01       Indemnification.  

(a)           Indemnification
by Regal.  Regal shall defend,
indemnify, and hold harmless LLC and its officers, directors, members, owners,
contractors, employees, representatives, agents, successors, and assigns (collectively,
“Representatives”) from and against any and all losses, obligations, risks,
costs, claims, liabilities, settlements, damages, liens, judgments, awards,
fines, penalties, expenses and other obligations whatsoever (including, without
limitation, reasonable attorneys’ fees and disbursements, except as limited by
Section 11.02, and any consultants or experts and expenses of
investigation) (collectively, “Costs”) suffered or incurred by LLC or its
Representatives in connection with, as a result of, based upon, or relating to,
(i) any breach by Regal of this Agreement, (ii) any use by Regal of
any LLC Property (other than LLC Property licensed by LLC to Regal under the
License Agreement) other than as authorized by this Agreement, (iii) any
third-party claims directly resulting from acts or omissions of Regal or its
designee(s), (iv) any breach of a Legacy Agreement prior to the date on
which such Legacy Agreement is assigned to LLC, (v) Regal’s fraud, willful
misconduct, or noncompliance with law, (vi) any infringement, violation,
misappropriation, or misuse of any third-party intellectual property rights by
the Regal Property (excluding the intellectual property or other rights
licensed by Regal pursuant to the License Agreement); or (vii) any items
disclosed by Regal pursuant to Section 10.02(b).

(b)           Indemnification
by LLC.  LLC shall defend, indemnify,
and hold harmless Regal and its Representatives from and against any and all
Costs suffered or incurred by Regal or its Representatives in connection with,
as a result of, based upon, or relating to, (i) any breach by LLC of this
Agreement, (ii) any use by LLC of any information, content or other
materials supplied by or on behalf of Regal hereunder (including the Brand),
but not under the License Agreement, other than as authorized by this
Agreement, (iii) any breach of a Legacy Agreement on or after the date on
which such Legacy Agreement is assigned to LLC, (iv) any damage caused by
LLC, its vendors or subcontractors in installation, inspection or maintenance
of any Equipment, (v) any third-party claims directly resulting from acts
or omissions of LLC or its designee(s), including subcontractors, (vi) any
infringement, violation, misappropriation, or misuse of any third-party
intellectual property rights by the LLC Property (excluding the intellectual
property or other rights licensed by LLC pursuant to the License Agreement); or
(vii) LLC’s fraud, willful misconduct, or noncompliance with law.

(c)           Mutual
Indemnification.  Each Party (the “Indemnifying
Party”) shall 

 45
 

defend, indemnify, and hold harmless the other Party and the other
Party’s Representatives from and against any and all Costs suffered or incurred
by the other Party or the other Party’s Representatives in connection with or
as a result of, and from and against any and all third party claims, suits,
actions, or proceedings actually or allegedly arising out of, based upon, or
relating to any infringement or dilution of any third party trademark,
tradename, service mark or service name by any trademark, tradename, service
mark or service name provided by the Indemnifying Party.  In the event of any infringement or dilution
giving rise to a claim for indemnification under Sections 10.02(b),
10.02(c) or 11.01(a)(iii), or if infringement or dilution potentially giving
rise to a claim under this Section is, in the Indemnifying Party’s opinion,
likely to occur the Indemnifying Party may, either:  (i) procure for the other Party the
right to continue using the trademark, tradename, service mark or service name
in question, (ii) replace or modify the trademark, tradename, service mark
or service name in question with a non-infringing or non-dilution alternative;
or (iii) order the other Party to cease use of, and terminate the grant of
rights under this Agreement with respect to, the trademark, tradename, service
mark or service name in question.  The
Indemnifying Party will have no obligation under this Section for any
infringement or dilution caused by, and the other Party will indemnify the
Indemnifying Party in the event of, use by the other Party of the trademark,
tradename, service mark or service name in question:  (A) after the Indemnifying Party has
notified the other Party to cease use of that trademark, tradename, service
mark or service name; (B) in combination with any other trademark,
tradename, service mark or service name not supplied by the Indemnifying Party;
or (C) in breach of this Agreement. 
This Section 11.01(c) states each Party’s entire liability and sole
and exclusive remedy for infringement or dilution claims or actions relating to
third party trademarks, tradenames, service marks or service names in
connection with this Agreement.  

Section 11.02       Defense
of Action. 
An indemnitor under this Article shall have the right to control the
defense and settlement of any and all claims, suits, proceedings, and actions
for which such indemnitor is obligated to indemnify, hold harmless, and defend
hereunder, but the indemnitee shall have the right to participate in such
claims, suits, proceedings, and actions at its own cost and expense.  An indemnitor shall have no liability under
this Article 11 unless the indemnitee gives notice of such claim to the
indemnitor promptly after the indemnitee learns of such claim so as to not
prejudice the indemnitor.  Under no
circumstance shall either Party hereto settle or compromise or consent to the
entry of any judgment with respect to any claim, suit, proceeding, or action
that is the subject of indemnification hereunder without the prior written
consent of the other Party, except for settlement involving only monetary
payment by the indemnitor or no commitment or admission by the indemnitee,
which consent shall not be withheld or delayed unreasonably.

ARTICLE
12

ADDITIONAL RIGHTS AND OBLIGATIONS

Section 12.01       Assistance.  Each Party, upon the request of the other,
shall perform any and all further reasonable acts and reasonably execute,
acknowledge, and deliver any and all documents which the other Party determines
in its sole reasonable judgment may be necessary, appropriate, or desirable to
carry out the intent and purposes of this Agreement, including without
limitation to document, perfect, or enforce the other Party’s right, title, or
interest in and 

 46
 

to any of such Party’s property, as well as any assistance requested in
connection with the proceedings, suits, and hearings described in
Section 12.02.

Section 12.02       Infringement.
 The Parties
shall notify one another promptly, in writing, of any alleged, actual or
threatened infringement, violation, misappropriation or misuse of or
interference with (“Infringement”) any intellectual property which such Party
knows of or has reason to suspect.

Section 12.03       Theatre
Passes. Upon the request of LLC’s CEO, Regal will
issue a number of annual passes, as reasonably requested by LLC and agreed by
the parties and as reasonably consistent with prior practice, to the Theatres
for use by LLC advertising clients, subject to Regal’s ability to issue such
passes pursuant to Regal’s agreements with film distributors.  LLC may purchase passes in excess of such
number each year at a reasonably negotiated price.  All other tickets used by LLC for promotional
and sales purposes will be acquired by LLC at Regal’s then current group ticket
discount rate.

Section 12.04       Compliance
with Law. 
Regal and LLC shall each at all times operate and conduct its business,
including, without limitation, exercising its rights under this Agreement, in
compliance with all applicable international, national, state, and local laws,
rules, and requirements, and the compliance by either Party with such laws,
rules and requirements shall under no circumstances be deemed a breach of this
Agreement. 

Section 12.05       Insurance.  Regal shall maintain with financially sound
and reputable insurance companies insurance on the Theatres and Equipment in
such amounts and against such perils as Regal deems adequate for its
business.  LLC shall maintain with
financially sound and reputable insurance companies insurance for its business
and Equipment in such amounts and against such perils as LLC deems adequate for
its business.  Each Party will name the
other Party (including its agents, officers, directors, employees and
affiliates) as an additional insured on such policies of insurance.  Furthermore, to the extent reasonably
practicable, LLC shall use commercially reasonable efforts to have Regal listed
as an additional insured on any insurance policy carried by the advertiser,
agent or event promoter in connection with Services provided under this
Agreement.   

Section 12.06       Most
Favored Nations. 
LLC shall promptly provide to Regal a copy of each agreement, amendment
or extension as may be entered into by LLC on or after the Effective Date with
each Founding Member (including the Regal Exhibitor Agreement) which amends any
term of the Exhibitor Services Agreement entered into with any of the Founding
Members, as such may be amended from time to time.  The Parties recognize and acknowledge that
the provision of the Service is dependent on the cooperation and operational
support of LLC and the Founding Members and, from time to time, LLC may elect
to waive compliance with a term of this Agreement or a term of an Exhibitor
Services Agreement entered into with another Founding Member, so long as LLC
acts reasonably and fairly in granting waivers requested by each of Regal, AMC
and Cinemark, as applicable.  If LLC acts
reasonably and fairly in granting such waivers to each of Regal, AMC and
Cinemark and any such waivers do not materially alter the applicable Exhibitor Services
Agreement, then such waiver will not be considered an amendment of the relevant
exhibitor’s Exhibitor Services Agreement for purposes of this Agreement and
shall not be covered by the terms of this Section 12.06.  Such copies shall be

 47
 

redlined to reflect all differences between such agreements or
amendments and this Agreement or corresponding amendment.  At the election of Regal, by written notice
to LLC within twenty (20) days following its receipt of such agreements or
amendments, to amend this Agreement so that it conforms, in part or whole, to
any one of such agreements or amendments, this Agreement shall be deemed so
amended by LLC and Regal as soon as reasonably practicable after receipt of
such notice.  

Section 12.07       Non-Competition
and Non-Solicitation.  

(a)           Non-Competition.  In consideration of Regal’s participation in
LLC and in consideration of the mutual covenants and agreements contained in
this Agreement, Regal and its Affiliates agree, except as otherwise provided in
this Agreement, not to engage or participate in any business, hold equity
interests, directly or indirectly, in another entity, whether currently
existing or hereafter created, or participate in any other joint venture that
competes or would compete with any business that LLC is authorized to conduct
in the Territory pursuant to this Agreement, whether or not LLC is actually
conducting such business in a particular portion of the Territory.  The foregoing restrictions shall not apply
(i) in the event Regal or its Affiliate acquires a competing business in
the Territory as an incidental part of an acquisition of any other business
that is not prohibited by the foregoing, if Regal disposes of the portion of
such business that is a competing business as soon as practicable, (ii) to
any direct or indirect ownership or other equity investments by Regal or its
Affiliates in such other competing business that represents in the aggregate
less than 10% of the voting power of all outstanding equity of such business,
and (iii) in the event Regal enters into any agreement for the acquisition
or installation of equipment or the provision of services on customary terms
that does not violate the exclusivity of LLC hereunder with any entity that has
other businesses and provides other services that may compete with LLC.  

(b)           Non-Solicitation.  For the Term of this Agreement and a
three-year period after its termination or expiration, each Party shall not,
without the prior written approval of the other Party, directly or indirectly:  (i) solicit for hire any employees of
any other Party or its Affiliates at the level of vice president or higher; or
(ii) induce any such employee of such Party to terminate their
relationship with such Party.  The foregoing
will not apply to individuals hired as a result of the use of a general
solicitation (such as a newspaper, radio or television advertisement) not
specifically directed to the employees of such Party.

ARTICLE
13

OWNERSHIP

Section 13.01       Property.

(a)           LLC
Property.  As between LLC and Regal,
LLC owns, solely and exclusively, any and all right, title, and interest in and
to the Service (including all Inventory and other content supplied by or on
behalf of LLC), the LLC Marks, the Software (excluding any Software owned by
Regal as provided in the License Agreement), LLC’s Confidential Information,
the Digital Content Network, and any and all other data, information, Equipment
(excluding the Regal Equipment), material, inventions, discoveries, processes,
methods, 

 48
 

technology, know-how, written works, software, works of visual art,
audio works, and multimedia works provided, developed, created, reduced to
practice, conceived, or made available by or on behalf of LLC to Regal or used
by LLC to perform any of its obligations under or in connection with this
Agreement, as well as any and all translations, improvements, adaptations,
reproductions, look and feel attributes, and derivates thereof (collectively,
the “LLC Property”), and, except as expressly and explicitly stated in this
Agreement, reserves all such right, title, and interest.  

(b)           Regal
Property.  As between Regal and LLC,
Regal owns, solely and exclusively, any and all right, title, and interest in
and to all content supplied by or on behalf of Regal, the Regal Marks, Software
not included in Section 13.01(a) above, Regal’s Confidential Information,
and any and all other data, information, Equipment (excluding the LLC
Equipment), material, inventions, discoveries, processes, methods, technology,
know-how, written works, software, works of visual art, audio works, and
multimedia works provided, developed, created, reduced to practice, conceived,
or made available by or on behalf of Regal to LLC or used by Regal to perform
any of its obligations under or in connection with this Agreement, as well as
any and all translations, improvements, adaptations, reproductions,
look-and-feel attributes, and derivates thereof (collectively, the “Regal
Property”), and, except as expressly and explicitly stated in this Agreement,
reserves all such right, title, and interest.

Section 13.02       Derived
Works.  

(a)           Derived
Works from LLC Property.  Any and all
data, information, and material created, conceived, reduced to practice, or
developed pursuant to this Agreement, but not pursuant to the License
Agreement, including, without limitation, written works, processes, methods,
inventions, discoveries, software, works of visual art, audio works,
look-and-feel attributes, and multimedia works, to the extent based on, using,
or derived from, in whole or in part, any LLC Property, whether or not done on
LLC’s facilities, with LLC’s equipment, or by LLC personnel, by either Party
alone or with each other or any third party, and any and all right, title, and
interest therein and thereto (including, but not limited to, the right to sue
for past infringement) (collectively, “LLC Derived Works”), shall be owned
solely and exclusively by LLC, and Regal hereby assigns, transfers, and conveys
to LLC any right, title, or interest in or to any LLC Derived Work which it may
at any time acquire by operation of law or otherwise.  To the extent any LLC Derived Works are
included in the Service, LLC hereby grants to Regal during the Term a
non-exclusive, non-transferable, non-sublicenseable license to such LLC Derived
Works solely for use in connection with the Service, as expressly provided by
this Agreement.  

(b)           Derived
Works from Regal Property.  Except as
specified in Section 13.02(a), any and all data, information, and material
created, conceived, reduced to practice, or developed pursuant to this
Agreement, but not pursuant to the License Agreement, including, without
limitation, written works, processes, methods, inventions, discoveries,
software, works of visual art, audio works, look-and-feel attributes, and
multimedia works, to the extent based on, using, or derived from, in whole or
in part, any Regal Property (and specifically including any materials included
in the Policy Trailer or the Branded Slots based on or derived from materials
supplied by Regal), whether or not done on Regal’s facilities, with Regal’s or
LLC’s equipment, or by Regal personnel, by either Party alone or with each
other or any third

 49
 

party, and any and all right, title, and interest therein and thereto
(including, but not limited to, the right to sue for past infringement)
(collectively, “Regal Derived Works”), shall be owned solely and exclusively by
Regal, and LLC hereby assigns, transfers, and conveys to Regal any right,
title, or interest in or to any Regal Derived Work which it may at any time
acquire by operation of law or otherwise. 
To the extent any Regal Derived Works are included in the Service, Regal
hereby grants to LLC during the Term a nonexclusive, non-transferable,
non-sublicenseable license to such Regal Derived Works solely for use in connection
with the Service, as expressly provided by this Agreement.

Section 13.03       No
Title.  This
Agreement is not an agreement of sale, and (a) no title or ownership
interest in or to any LLC Property is transferred to Regal, and (b) no
title or ownership interest in or to any Regal Property is transferred to LLC,
as a result of or pursuant to this Agreement. 
Further, (i) Regal acknowledges that its exercise of rights with
respect to the LLC Property shall not create in Regal any right, title or
interest in or to any LLC Property and that all exercise of rights with respect
to the LLC Property and the goodwill symbolized thereby or connected therewith
will inure solely to the benefit of LLC, and (ii) LLC acknowledges that
its exercise of rights with respect to the Regal Property shall not create in
LLC any right, title or interest in or to any Regal Property and that all
exercise of rights with respect to the Regal Property and the goodwill
symbolized thereby or connected therewith will inure solely to the benefit of
Regal.

ARTICLE
14

CONFIDENTIALITY

Section 14.01       Confidential
Treatment. 
For a period of three years after the termination of this Agreement:

(a)           Treatment
of Confidential Information.  Each
Party shall use and cause its Affiliates to use the same degree of care it uses
to safeguard its own Confidential Information and to cause its and its
Affiliates’ directors, officers, employees, agents and representatives to keep
confidential all Confidential Information; and each Party shall hold and shall
cause its Affiliates to hold and shall cause its and its Affiliates’ directors,
officers, employees, agents and representatives to hold in confidence, unless
compelled to disclose by judicial or administrative process or, in the opinion
of counsel, by the requirements of law, Confidential Information.

(b)           LLC’s
Confidential Information.  Regal
agrees that the Confidential Information of LLC shall only be disclosed in
secrecy and confidence, and is to be maintained by Regal in secrecy and
confidence subject to the terms hereof. 
Regal shall (i) not, directly or indirectly, use the Confidential
Information of LLC, except as necessary in the ordinary course of LLC’s
business, or disclose the Confidential Information of LLC to any third party
and (ii) inform all of its employees to whom the Confidential Information
of LLC is entrusted or exposed of the requirements of this Section and of their
obligations relating thereto.

(c)           Regal’s
Confidential Information. 
Confidential Information of Regal shall not be supplied by LLC or its
Subsidiaries to any Person who is not an employee of LLC, including any
employee of a Member or of LLC’s manager who is not an employee of LLC.  

 50
 

Notwithstanding the foregoing, Regal Confidential Information may be
disclosed to authorized third-party contractors of LLC if LLC determines that
such disclosure is reasonably necessary to further the business of LLC, and if
such contractor executes a non-disclosure agreement preventing such contractor
from disclosing Regal’s Confidential Information for the benefit of each
provider of Regal’s Confidential Information in a form reasonably acceptable to
the Founding Members.  Regal’s
Confidential Information disclosed to LLC shall not be shared with any other
Member without Regal’s written consent.

Section 14.02       Injunctive
Relief.  It
is understood and agreed that each Party’s remedies at law for a breach of this
Article 14, as well as Section 12.07, will be inadequate and that
each Party shall, in the event of any such breach or the threat of such breach,
be entitled to equitable relief (including without limitation provisional and
permanent injunctive relief and specific performance) from a court of competent
jurisdiction.  The Parties shall be
entitled to the relief described in this Section 14.02 without the
requirement of posting a bond.  Nothing
stated herein shall limit any other remedies provided under this Agreement or
available to the Parties at law.

ARTICLE
15

MISCELLANEOUS

Section 15.01       Notices.  All notices, consents, and other communications
between the Parties under or regarding this Agreement shall be in writing and
shall be sent to the recipient’s address set forth in this section by hand
delivery, nationally respected overnight carrier, or certified mail, return
receipt requested.  Such communications
shall be deemed to have been received on the date actually received.

	
  

  	
  LLC:

  	
  National CineMedia, LLC

  
	
   

  	
   

  	
  9110 East Nichols Ave., Suite 200

  
	
   

  	
   

  	
  Centennial, CO 80112

  
	
   

  	
   

  	
  Attention:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  National CineMedia, LLC

  	
   

  
	
   

  	
   

  	
  9110 East Nichols Ave., Suite 200

  	
   

  
	
   

  	
   

  	
  Centennial, CO 80112

  
	
   

  	
   

  	
  Attention:

  	
  General Counsel

  
	
   

  	
   

  	
   

  
	
   

  	
  Regal:

  	
  Regal Cinemas, Inc.

  	
   

  
	
   

  	
   

  	
  7132 Regal Lane

  	
   

  
	
   

  	
   

  	
  Knoxville, TN 37918

  
	
   

  	
   

  	
  Attention:

  	
  General Counsel

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  Hogan & Hartson L.L.P.

  	
   

  
	
   

  	
   

  	
  1200 Seventeenth Street, Suite 1500

  	
   

  
	
   

  	
   

  	
  Denver, CO 80202

  
	
   

  	
   

  	
  Attention:

  	
  Christopher J. Walsh

  
							

 

 51
 

Either Party may
change its address for notices by giving written notice of the new address to
the other Party in accordance with this section, but any element of such Party’s
address that is not newly provided in such notice shall be deemed not to have
changed.

Section 15.02       Waiver;
Remedies. 
The waiver or failure of either Party to exercise in any respect any right
provided hereunder shall not be deemed a waiver of such right in the future or
a waiver of any other rights established under this Agreement.  All remedies available to either Party hereto
for breach of this Agreement are cumulative and may be exercised concurrently
or separately, and the exercise of any one remedy shall not be deemed an
election of such remedy to the exclusion of other remedies.

Section 15.03       Severability.  Should any term or provision of this
Agreement be held to any extent unenforceable, invalid, or prohibited under
law, then such provision shall be deemed restated to reflect the original
intention of the Parties as nearly as possible in accordance with applicable
law and the remainder of this Agreement. 
The application of any term or provision restated pursuant hereto to
Persons, property, or circumstances other than those as to which it is invalid,
unenforceable, or prohibited, shall not be affected thereby, and each other
term and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

Section 15.04       Integration;
Headings. 
The Parties hereto agree that the Amended and Restated Exhibitor
Services Agreement dated as of July 15, 2005 is hereby terminated (except
as otherwise provided in the and the Letter Agreement dated of even date
herewith by and among LLC, AMC, Cinemark and Regal (the “ESA Payment Letter”),
and that this Agreement and the exhibits hereto (each of which is made a part
hereof and incorporated herein by this reference) and the ESA Payment Letter
constitute the complete and exclusive statement of the agreement between the
Parties with respect to the subject matter of this Agreement, and supersede any
and all other prior or contemporaneous oral or written communications, proposals,
representations, and agreements, express or implied.  This Agreement may be amended only by mutual
agreement expressed in writing and signed by both Parties, except as otherwise
provided in Section 12.06.  Headings
used in this Agreement are for reference only and shall not affect the
interpretation of this Agreement.

Section 15.05       Construction.  The Parties hereto have participated jointly
in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as if
drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. 
Whenever required by the context, any pronoun used in this Agreement
shall include the corresponding masculine, feminine or neuter forms, and the
singular forms of nouns, pronouns, and verbs shall include the plural and vice
versa.  Reference to any agreement,
document, or instrument means such agreement, document, or instrument as
amended or otherwise modified from time to time in accordance with the terms
thereof, and if applicable.  The use of
the words “include” or “including” in this Agreement shall be by way of example
rather than by limitation.  The use of
the words “or,” “either” or “any” shall not be exclusive.

Section 15.06       Non-Recourse.  Notwithstanding anything contained in this
Agreement to the contrary, it is expressly understood and agreed by the Parties
hereto that each and every

 52
 

representation, warranty, covenant, undertaking and agreement made in
this Agreement was not made or intended to be made as a personal
representation, undertaking, warranty, covenant, or agreement on the part of
any individual or of any partner, stockholder, member or other equity holder of
either Party hereto, and any recourse, whether in common law, in equity, by
statute or otherwise, against any such individual or entity is hereby forever
waived and released.

Section 15.07       Governing
Law; Submission to Jurisdiction.

Subject to the
provisions of Section 14.02 and the Parties’ agreement that the United
Nations Convention on Contracts for the International Sale of Goods shall not
apply to this Agreement and is hereby disclaimed by the Parties:

(a)           Governing
Law.  This Agreement is to be
construed in accordance with and governed by the internal laws of the State of
Delaware without giving effect to any choice of law rule that would cause the
application of the laws of any jurisdiction other than the internal laws of the
State of Delaware to the rights and duties of the Parties.

(b)           Jurisdiction.  Each Party hereto agrees that any legal
action or other legal proceeding relating to this Agreement or the enforcement
of any provision of this Agreement shall be brought or otherwise commenced
exclusively in any state or federal court located in Delaware or in New York,
New York.  Subject to the preceding
sentence, each Party hereto:

(i)            expressly and irrevocably consents
and submits to the jurisdiction of each state and federal court located in New
York, New York (and each appellate court located in the State of New York) in
connection with any such legal proceeding, including to enforce any settlement,
order or award;

(ii)           consents to service of process in any
such proceeding in any manner permitted by the laws of the State of New York,
and agrees that service of process by registered or certified mail, return
receipt requested, at its address specified pursuant to Section 15.01 is
reasonably calculated to give actual notice;

(iii)          agrees that each state and federal
court located in New York, New York shall be deemed to be a convenient forum;

(iv)          waives and agrees not to assert (by
way of motion, as a defense or otherwise), in any such legal proceeding
commenced in any state or federal court located in New York, New York, any
claim that such Party is not subject personally to the jurisdiction of such
court, that such legal proceeding has been brought in an inconvenient forum,
that the venue of such proceeding is improper or that this Agreement or the
subject matter hereof or thereof may not be enforced in or by such court; and

(v)           agrees to the entry of an order to
enforce any resolution, settlement, order or award made pursuant to this
Section by the state and federal courts located in New York, New York and in
connection therewith hereby waives, and agrees not to assert by way of motion,
as a defense, or otherwise, any claim that such resolution, settlement, order
or award is inconsistent with or violative of the laws or public policy of the
laws of the State of New York or any other jurisdiction.

 53
 

(c)           Costs
and Expenses.  In the event of any
action or other proceeding relating to this Agreement or the enforcement of any
provision of this Agreement, the prevailing party (as determined by the court)
shall be entitled to payment by the non-prevailing party of all costs and
expenses (including reasonable attorneys’ fees) incurred by the prevailing
party, including any costs and expenses incurred in connection with any
challenge to the jurisdiction or the convenience or propriety of venue of
proceedings before any state or federal court located in New York, New York.

Section 15.08       Assignment.  Neither Party may assign or transfer, by
operation of law or otherwise, any of its rights or obligations under this
Agreement to any third party without the other Party’s prior written
consent.  Either Party may fulfill their
respective obligations hereunder by using third-party vendors or
subcontractors; provided, however that such Party shall remain fully and
primarily responsible to ensure that such obligations are satisfied.  Regal acknowledges and agrees that in the
event of assignment or transfer by the sale of all or substantially all of its
assets, the failure to obtain (by operation of law or otherwise) an agreement
in writing by assignee/transferee to be bound by the terms of this Agreement to
the same extent as if such assignee/transferee were a party hereto (an “Assignment
and Assumption”) of its interest in this Agreement in respect of such assets as
part of the sale shall constitute a material breach of this Agreement.  Notwithstanding the foregoing, this Agreement
shall not be assignable by either Party unless the assignee enters into an
Assignment and Assumption.  A Permitted
Transfer shall not be deemed an assignment or transfer for purposes of this
Agreement; provided, however, any Permitted Transfer by assignment to an
Affiliate of Regal shall be (i) conditioned upon (A) the transferee
entering into an Assignment and Assumption, (B) Regal agreeing in writing
to remain bound by the obligations under this Agreement, and
(ii) effective only so long as the Affiliate remains an Affiliate of
transferee.  Any attempted assignment in
violation of this section shall be void.

Section 15.09       Force
Majeure. 
Any delay in the performance of any duties or obligations of either
Party (except the payment of money owed) will not be considered a breach of
this Agreement if such delay is caused by a labor dispute, shortage of
materials, fire, earthquake, flood, or any other event beyond the control of
such Party, provided that such Party uses commercially reasonable
efforts, under the circumstances, to notify the other Party of the
circumstances causing the delay and to resume performance as soon as possible.

Section 15.10       Third
Party Beneficiary. 
The Parties hereto do not intend, nor shall any clause be interpreted,
to create under this Agreement any obligations or benefits to, or rights in,
any third party from either LLC or Regal. 
Neither Party hereto is granted any right or authority to assume or
create any obligation or responsibility, express or implied, on behalf of, or
in the name of, the other Party, or to bind the other Party in any matter or
thing whatever.  No Affiliate of either
Party shall have any liability or obligation pursuant to this Agreement.  Each Party shall be solely responsible, and
each Party agrees to look solely to the other, for the satisfaction of such other
Party’s obligations under this Agreement.

Section 15.11       Export.

(a)           LLC’s
Software and Confidential Information. 
Regal acknowledges and agrees: 
(i) that the Software and the Confidential Information of LLC are
subject to the export

 54
 

controls of the United States, and (ii) that Regal has no right
to, and further agrees that it will not, export or otherwise transfer or permit
the transfer of any Software or Confidential Information of LLC outside the
Territory.  Regal will defend, indemnify,
and hold harmless LLC from and against all fines, penalties, liabilities,
damages, costs, and expenses incurred by LLC as a result of any failure to
comply with the preceding sentence.

(b)           Regal’s
Confidential Information.  LLC
acknowledges and agrees:  (i) that
the Confidential Information of Regal is subject to the export controls of the
United States, and (ii) that LLC has no right to, and further agrees that
it will not, export or otherwise transfer or permit the transfer of any
Confidential Information of Regal outside the Territory.  LLC will defend, indemnify, and hold harmless
Regal from and against all fines, penalties, liabilities, damages, costs, and
expenses incurred by Regal as a result of any failure to comply with the
preceding sentence.

Section 15.12       Independent
Contractors. 
The Parties’ relationship to each other is that of an independent
contractor, and neither Party is an agent or partner of the other.  Neither Party will represent to any third
party that it has, any authority to act on behalf of the other.

Section 15.13       Counterparts.  This Agreement may be executed in any number
of separate counterparts each of which when executed and delivered to the other
Party hereto shall be an original as against the Party whose signature appears
thereon, but all such counterparts shall together constitute one and the same
instrument.

[Signature
Page to Follow]

 55

IN WITNESS WHEREOF, the Parties have executed this
Agreement as of the day and year first above written.

	
  

  	
  REGAL CINEMAS, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael L. Campbell

  	
   

  
	
   

  	
  Name:

  	
  Michael L. Campbell

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
						

 

	
  

  	
  NATIONAL CINEMEDIA, LLC

  
	
   

  	
  By: 

  	
  NATIONAL CINEMEDIA, INC.,

  its Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary W. Ferrera

  	
   

  
	
   

  	
  Name:

  	
  Gary W. Ferrera

  
	
   

  	
  Title:

  	
  Executive Vice President and Chief Financial Officer

  
						

 

[Signature page to
ESA]

EXHIBIT
A

THE SERVICE

A.            “Advertising Services” consist of the following:

1.             Lobby Promotions.  “Lobby Promotions” means as follows:

All lobby promotions and
other in-theatre promotional activities (excluding the Digital Content Service,
the Digital Carousel, the Traditional Content Program and other on-screen
content, as described in 3 below), but specifically excluding the
following promotional activities (which Regal shall retain the right to perform
and have performed on its behalf):

(i)                                     promotional
activities arising under the Regal contracts identified in the Specification
Documentation;

(ii)                                  (1) poster
case advertising, digital poster case advertising, advertising on digital
animated poster cases, ATM or ticket kiosk screens (or such items that may replace
digital poster cases, or ATM or ticket kiosk screens in the future) or other
substantially similar display mechanisms and other lobby or in-theatre
promotions for (A) Theatre Advertising, (B) film festivals organized by Regal
(unless such poster cases have been sold by LLC), (C) fundraising programs
conducted by Regal for any non-profit organizations, (D) full-length theatrical
productions, and (E) other promotional material that may include some or all of
the following types of content: isolated images or still scenes from feature
films, full motion elements that are not a movie trailer, interactive elements,
audio elements and motion sensors; provided, however, that no
movie trailers or content equivalent to movie trailers are displayed;

(2) drink cup and popcorn bag/tub
advertising related to the Concessions, as necessary to fulfill contractual
obligations of Regal with respect to promotion of such Concessions in the
Theatres;

(3) lobby
or in-theatre promotions and advertising for vendors of services provided to
the Theatres, provided such promotion is incidental to the vendor’s service,
including by way of illustration and not limitation, (A) logos of
Movietickets.com and Fandango related to promotions for online ticketing
services, (B) credit card company logos displayed at the box office,
automated box office, Concession stands, cafes, arcades, and lobby kiosks,
(C) bank logos displayed at ATM’s, (D) phone company logos displayed
at public telephones, and (E) logos of vendors who provide restroom soaps,
toilet paper and lotions;

(4) logos on digital menu boards at the
Concession stand or digital 

 A-1
 

displays at the box office of manufacturers
of such products;

(5) advertising and/or signage pursuant
to the IMAX agreement (if applicable); and

(6) any trademark, service mark, logo or
other branding of Regal (or its theatre-operating Affiliates), film studio(s),
distributors and production companies;

provided, however,
that Regal shall not be permitted to exhibit or display any promotion described
in this paragraph A.1.(ii), if such promotion features any trademark, service
mark, logo or other branding of a party other than the film studio(s),
distributors, production companies, Concession providers, or other service
vendors or providers responsible for the production or promotion, as
applicable, or of Regal (or its theatre-operating Affiliates), unless such
promotion relates to a Strategic Program that complies with Section 4.07(b).

Popcorn bags, popcorn
tubs, cups and kids’ trays will be provided according to Regal’s template and
packaging requirements, subject to Regal’s providing reasonable notice of
changes to any such requirements.  LLC
may obtain advertising for all of the surface area of all such items that is
not required (i) under the Beverage Agreement, (ii) as necessary to fulfill
contractual obligations of Regal with respect to Concessions, and (iii)
incidental branding needs of Regal, subject to the terms contained in the
Beverage Agreement.  Regal shall not
amend or modify any contract to the extent such amendment or modification would
be inconsistent with the exclusive rights of LLC hereunder or have the effect
of any extension of third party restrictions on surface area advertising on
such popcorn bags, popcorn tubs, cups and kids’ trays, except as permitted
under Section 4.06(a) with respect to the Beverage Agreement or as permitted
under Section 4.07(a).

2.             Event Sponsorships

“Event Sponsorship” means
the sale of advertising or sponsorships with respect to any event included in
the Digital Programming Services including any Event Trailers or Meeting
Services.

3.             Digital Content Service,
Digital Carousel and Traditional Content Program

The Digital Content
Service (which includes the Pre-Feature Program, Policy Trailer, Event Trailer
and the Video Display Program), the Digital Carousel and the Traditional
Content Program, and all other on-screen content which is exhibited in Theatre
auditoriums prior to the feature film presentation, but specifically excluding
Trailers.

 A-2
 

B.            Digital Programming Services

“Digital Programming Services” means the electronic distribution
of digital programming entertainment content other than the Pre-Feature
Program, the Digital Carousel and the Video Display Program (including, without
limitation, programming such as sports, music and comedy events) and the
exhibition thereof in some or all of the Theatres.  “Digital Programming Services” shall not
include (i) the distribution of feature films or Trailers or (ii) the
electronic distribution of digital feature film content (“Digital Films”) or
Trailers; provided, however, that LLC may distribute Digital
Films or Trailers across the Digital Content Network upon the prior written
approval of Regal.

C.            Meeting Services

“Meeting Services” means uses of the Theatres other than Digital
Programming Services which may or may not be dependent on the electronic
distribution of digital programming content, such as business meetings and
educational/training meetings.

“Meeting Services”
includes three types of meetings

1.             Meetings With a Movie

2.             Meetings Without a
Movie

3.             Church Worship
Services

Meeting Services shall not include events involving the exhibition of
only a feature film without a meeting to an organized group, such as birthday
parties, group sales to schools or other private screenings, or internal
meetings or training of Regal employees.

 A-3

EXHIBIT
A-1

Regal

INVENTORY FOR LOBBY PROMOTIONS

The Inventory of Lobby
Promotions for each Theatre to which LLC has “pre-approved” access is as listed
below.  Per Flight (unless otherwise
specified below), LLC may provide each Theatre with any combination of Lobby
Promotions as described below.

	
  Item

  	
   

  	
  Inventory per Flight

  	
   

  	
  Quantity

  	
   

  	
  Spec

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Box Office Handout

  	
   

  	
  2 programs per Theatre

  	
   

  	
  TBD

  	
   

  	
  3”x5” 2-sided

  
	
  (1 handout per transaction; not film specific)

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exit Sampling

  	
   

  	
  1 program per Theatre

  	
   

  	
  TBD

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Poster Case

  	
   

  	
  1 program per Theatre

  	
   

  	
  varies (below)

  	
   

  	
  27”x40”

  
	
  

  	
   

  	
   

  	
   

  	
  Live Area

  	
   

  	
  24”x38”

  
	
  (1-11 screens: 1 poster; 12 screens: 2 posters; 13-20 screens: 3
  posters; 21+ screens: 4 posters)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tabling/Demo

  	
   

  	
  1 program per Theatre

  	
   

  	
  1 per client

  	
   

  	
  4-6’ table

  
	
  (No active “recruitment” of patrons)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vehicle/Motorcycle

  	
   

  	
  1 program per Theatre

  	
   

  	
  1 per client

  	
   

  	
   

  
	
  (Displays limited to specific list of Theatres provided by Regal, and
  updated from time to time after reasonable advance notice to LLC)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Background Music

  	
   

  	
  1 program per Theatre

  	
   

  	
  N/A

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Counter Cards

  	
   

  	
  2 programs per Theatre

  	
   

  	
  2-3 per client

  	
   

  	
  13”x16.5”x4”

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Danglers

  	
   

  	
  1 programs per Theatre per
  quarter

  	
   

  	
  2-3 per client

  	
   

  	
  18”x24”

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Static Clings

  	
   

  	
  1 program per Theatre per
  quarter

  	
   

  	
  2-3 per client

  	
   

  	
  4”x6”

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Banners

  	
   

  	
  1 program per Theatre per
  quarter

  	
   

  	
  1 per client

  	
   

  	
  6’x4’

  

 

 A-1-1
 

 

	
  Lobby Display

  	
   

  	
  2 programs per Theatre

  	
   

  	
  1 per client

  	
   

  	
  4’x6’

  
	
  (Displays
  limited to specific list of Theatres provided by Regal, and updated from time
  to time after reasonable advance notice to LLC)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Lobby Standee

  	
   

  	
  2 programs per Theatre

  	
   

  	
  1 per client

  	
   

  	
  3’x5’

  
	
  (Displays limited to specific list of Theatres provided by Regal, and
  updated from time to time after reasonable advance notice to LLC)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Floor Mats

  	
   

  	
  1 program per Theatre per
  quarter

  	
   

  	
  1 per client

  	
   

  	
  4”x6’

  

 

 A-1-2

EXHIBIT
B

A.  Creative Services (See Section 4.05(a))

LLC will provide Regal with up to 1,000 hours per year associated with
Creative Services in conjunction with the creation of certain elements of the
Pre-Feature Program (including the Policy Trailer, the Brand, and the Branded
Slots) and Video Display Program at no charge. 
Additional hours will be billed as set forth in item 2 below.  The Creative Services provided at no cost may
not include creation of Strategic Programs.

“Creative Services” include the provision of (i) concept work, idea
creation, scripting, treatments, storyboarding, timelines and animatics, (ii)
execution, animation, production, post production, sound design, final encoding
and the preparation of all deliverables, and (iii) project management,
meetings, communications, sub contractor management and all administrative
activity related to said creative services.

1. 
Allocated 1,000 Hours Per Year

All projects will be quoted on a GMH (Guaranteed
Maximum Hours) basis by which the Parties will agree to the concept and
execution plan of the project.  This
agreement may be based on treatments, scripts, storyboards, timelines or
animatics and will define the intended scope of all creative projects.  LLC will guarantee the total maximum hours allocated
to the project regardless of actual hours invested so long as the defined scope
is not increased.  Scope increases may
cause LLC to allocate more hours to a project and therefore could cause
overruns in the project’s GMH, resulting in additional hours (and possibly
fees).  In all cases, any work resulting
in overruns will be communicated to Regal by LLC prior to the work actually
being done.

There is no specific deliverable attached to the
accrual of hours, meaning that any project cancelled, put on hold, or for which
production may extend beyond the anniversary of the agreement, will still have
hours accrued against it that were incurred in that corresponding year.  At the end of each calendar year, the balance
of hours will be zeroed out.  Unused hours
will not carry forward.  LLC shall
provide a quarterly status report to Regal of all hours spent on any particular
project as well as the amount of hours spent on an aggregate basis for all
projects in any given calendar year.

2. 
Additional Work

Upon the utilization of 1,000 hours of Creative
Services provided by LLC to Regal on any combination of projects within one
calendar year, LLC will begin charging exhibitor $[***] per hour for all
additional hours, subject to the CPI Adjustment.  These charges will be consistent for all
Creative Services provided across all creative groups within LLC.

B.  Beverage Agreement Advertising Rate (See
Section 4.06(a))

The initial Beverage Agreement Advertising Rate is $[***] per thousand
attendees in Regal Attendance for a 30-second advertisement.  The Beverage Agreement Advertising Rate 

 B-1
 

shall (i) increase
8% per year for each of the first two fiscal years beginning at the end of LLC’s
2007 fiscal year; (ii) beginning at the end of the period set forth in (i)
above, increase 6% per year for each of the next two fiscal years; and (iii)
beginning at the end of the period set forth in (ii) above, increase in an
amount equal to the annual percentage increase in the advertising rates per
thousand attendees charged by LLC to unaffiliated third parties (excluding the
advertising associated with the Beverage Agreement) for on-screen advertising
in the Pre-Feature Program during the last six minutes preceding the start of
the feature film for each fiscal year for the remainder of the Term, but in no
event more than the highest advertising rate per thousand attendees being
then-charged by LLC.

The rate for a longer or shorter advertisement shall be adjusted based
on a multiple or percentage of the 30-second rate.  For illustrative purposes, the initial
Beverage Agreement Advertising Rate for 90 seconds of advertising as of the
Effective Date would be $[***].  The
Beverage Agreement Advertising Rate of $[***] agreed to by the Parties is a discounted
rate due to the length of the Agreement and the initial commitment to purchase
90 seconds of advertising.

C. 
Digital Programming (See Article 6)

1. 
Revenue Share

Regal will retain 15% of Net Ticket Revenue for
tickets sold pursuant to Digital Programming Services and 100% of all Concession
sales.  “Net Ticket Revenue” means all
ticket revenue, net of taxes and refunds, excluding “Comp Passes” distributed
for marketing purposes, which shall not exceed 25 per Theatre.  If Comp Passes exceed 25 per Theatre, LLC
shall reimburse Regal Net Ticket Revenue for such Comp Passes exceeding 25 per
Theatre.

LLC shall distribute to the participating Founding
Members a total of 15% of net revenue received in the form of cash or non-cash
consideration pursuant to any Event Sponsorship or other promotional fee for a
Digital Programming event.  A percentage
of the 15% Founding Members’ share of revenue for such Event Sponsorship or
other promotional fee shall be allocated to Regal based upon the number of
tickets sold (excluding Comp Passes) at Theatres for the Digital Programming
event divided by the number of total tickets sold at all theatres of
participating Founding Members (excluding Comp Passes) for the Digital
Programming Services event.

2. 
Availability

LLC is pre-approved to schedule Digital Programming in
a minimum of one auditorium in any Digitized Theatre that (i) has the requisite
technology to exhibit the specific Digital Programming event and (ii) has more
than 12 auditoriums.  It is understood
that live events will require additional equipment over the minimum equipment
required in a Digitized Theatre. 
Installation of such additional equipment shall be made by Regal at its
discretion.  For the event to be pre-approved,
LLC must provide 10 days’ notice of the Digital Programming event to Regal and
the Digital Programming event must be during any Monday through Thursday night
during non-Digital Event Peak Season.

 B-2
 

“Digital Event Peak Season” shall mean: (i) Martin
Luther King weekend, (ii) Presidents’ Day weekend, (iii) Thursday
through Easter weekend, (iv) Memorial Day weekend, (v) the Wednesday
prior to the Fourth of July weekend through the Wednesday after the Fourth of
July weekend, (vi) Labor Day weekend, (vii) Thanksgiving week, and
(viii) one week prior to Christmas through the week after New Year’s.  For purposes of this definition, weekend
means Friday through Monday and week means Monday through Sunday.

LLC may exhibit Digital Programming Services in time
periods other than those listed above only with approval from Regal, which
approval may be (i) granted as additional categories of pre-approved Digital
Programming Services or (ii) granted on a case-by-case basis.  LLC’s notification of pre-approved Digital
Programming events or requests for approval on a case-by-case basis will be submitted
by a standard request form.  Regal shall
respond regarding whether it will accept a proposed Digital Programming event
within three (3) business days of being presented with such proposal.  Additionally, LLC may not exhibit any Digital
Programming event related to the release of a feature film (i) directly on DVD
(or a subsequently developed system for viewing films at home) or to handheld
or mobile devices, or (ii) on DVD (or subsequently developed system for viewing
films at home), pay-per-view, cable, satellite or network television, or
through other electronic means within 120 days after the release date of such
feature film in Theatres, except in each case as otherwise agreed to by Regal.

If a Digital Programming Services presentation has
sold more than 75% of the seats at the Theatre made available, at least
twenty-fours (24) hours prior to such event, Regal will make commercially
reasonable efforts to make available an additional or larger auditorium for
such presentation.

3. 
Sales Reporting

Regal and all Theatres presenting a Digital
Programming event shall report to LLC the ticket sales, passes, and refunds
upon LLC’s request, provided, that Regal shall have no obligation to provide
such updates more frequently than they are available internally in accordance
with its ordinary business practices.

4. 
In-Theatre Retail Opportunities

Any retail and merchandising opportunities and related
revenue and cost sharing related to Digital Programming Services may be agreed
between LLC and Regal on an event-by-event basis.

5. 
Marketing and Promotion

Theatres hosting a Digital Programming event and other
Theatres in the designated marketing area (DMA) shall allow LLC to play an
Event Trailer for a maximum of four (4) weeks prior to the Digital Programming
event, consistent with the provisions of Section 6.03.  Such Event Trailer will start after
Showtime.  Every Event Trailer will
indicate the date and location of the event. 
LLC may also use any other marketing and advertising Inventory it
controls as set forth on Exhibit A-1 to market the Digital Programming
event.  All other 

 B-3
 

marketing initiatives that utilize databases, websites or other “marketing
assets” controlled by Regal will be agreed between LLC and Regal.

All Event Trailers and other marketing and promotional
activities relating to any Digital Programming event and displayed in any
Theatre must (i) have received, or be such that, had it been rated, it would
have received an MPAA rating of “G” or “PG” to be played prior to a feature
film with a “G,” “PG,” or “PG-13” rating, (ii) have received, or be such that,
had it been rated, it would have received an MPAA rating of “G,” “PG,” “PG-13”
or “R” to be played prior to a feature film with an “R” rating, and (iii) be
pre-approved by Regal prior to use, which approval shall not be unreasonably
withheld or delayed.

D.  Meeting Services (See Article 6)

1. 
Revenue Share

Payments between LLC and Regal related to Meeting
Services shall be determined as set forth in Exhibit B-1.

2.  Availability

The provisions in Exhibit B-1 identify the
availability of Theatres for Meeting Services on a pre-approved basis.  Meeting Services may be provided at such
other times and under such other terms as may be agreed by Regal and LLC.

3.  General Requirements

Regal must provide approval or decline a Meeting
Services event that is not pre-approved within three (3) business days of
receiving notice of such event.

Regal and LLC will develop a mutually acceptable
process for billing and collecting ticket and Concession sales.

The aggregate of fees other than movie admission and
Concessions, including fees such as rental fees, fees for concierge services
and catering fees, charged for a Meeting with a Movie must be the greater of
$[***] per hour or $[***] per regular show time replaced by the
event (annually adjusted based on increases in LLC’s auditorium rental rates),
calculated with respect to the time used by LLC for the meeting in excess of
the running time of the film.

E.  Event
Services Administrative Fee (See Section 6.07)

The Administrative Fee charged for Digital Programming events shall
cover all post-production services (including ingesting, editing and
encryption) performed by LLC and delivery of content to Theatre(s) through the
Digital Content Network.  If LLC establishes
an additional digital network, pricing related to services provided for such
network will be developed separately.

 B-4
 

The Administrative Fee shall initially be $[***] per location delivered (subject
to the CPI Adjustment), with a minimum of $[***] (subject to the CPI Adjustment), which includes a $[***] bandwidth surcharge.

The Administrative Fee shall not be charged for production or delivery
by LLC of the Event Trailer.  Any fees
and charges relating to delivery by LLC to Regal of Digital Films or Trailers
not produced by LLC will be negotiated by Regal and LLC at a later date.

Encoding (should it be required) will be charged separately at the rate
of $125 per hour (subject to the CPI Adjustment).

 B-5

 

Exhibit B-1

 

	
  Approved Events

  	
   

  	
  Revenue Share

  
	
  Regal grants pre-approval for Meetings With or Without a Movie that
  satisfy the criteria below:

  	
   

  	
  Meeting Without a Movie

  
	
  

  	
   

  	
   

  
	
  (includes tent pole films)

  	
   

  	
   

  
	
  Start and end times fall
  between Mon - Thurs (6am - 6pm)

  	
   

  	
  LLC shall pay Exhibitor 15% of rental revenue

  
	
  Meeting occurs in Theatres
  more than 12 auditoriums

  	
   

  	
   

  
	
  Tickets for all auditorium
  seats are sold at adult rate if movie is to be shown

  	
   

  	
   

  
	
  Film is available at the
  relevant theatre, utilizing 2nd, 3rd, 4th print of a movie (if movie is to be
  shown), and has received Exhibitor’s film department approval

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  Meeting with a Movie:

  
	
  

  	
   

  	
   

  
	
  

  	
   

  	
  LLC shall sell 100% of the seats in the auditorium
  at the full adult ticket price (unless otherwise approved by Regal in
  advance).

  
	
  Church Worship Services

  Approval required

  	
   

  	
  Regal shall retain 100% of all admissions and
  concessions revenue; LLC shall retain 100% of meeting revenue.

  
	
   

  	
   

  	
   

  
	
  Exceptions that require approval:

  	
   

  	
  Church Worship Services

  
	
  1) Requires more than 1
  Auditorium per request/group

  	
   

  	
   

  
	
  2) Booked in Peak Season**

  	
   

  	
  LLC shall pay Regal 50% of rental revenue

  
	
  3) Events requested less
  than 10 business days from the date of event

  	
   

  	
   

  
	
  4) Events in Theatres
  identified in the Specification Documentation

  	
   

  	
   

  

 

 B-1-1
 

	
  **

  	
   

  	
  Peak Season:

  

1) Martin Luther King weekend

2) Presidents’ Day weekend

3) Easter weekend—Thurs -> Sun

4) Memorial Day weekend

5) Week of the 4th of July

6) Labor Day weekend

7) Thanksgiving week

8)
Week prior to Christmas through the week after New Year’s

 B-1-2

Schedule
1

Calculation of Exhibitor Allocation, Theatre Access Fee and Run-Out Obligations

A. 
Definitions

Within the context of
this Schedule 1, the following terms shall have the following meanings:

“4.03 Participating Attendance”
means the sum of Regal Attendance, Cinemark Attendance and AMC Attendance,
calculated only with respect to Theatres, Cinemark Theatres and AMC Theatres
that display an advertising campaign that Regal has not displayed in at least
some Theatres pursuant to Section 4.03(viii) or (ix) of this Agreement or
because of lack of equipment to display the Video Display Program.

“4.03 Theatre Access Fee” means
the product of (i) the difference between (A) Regal 4.03 Opt-In Revenue minus
(B) Regal Opt-Out Revenue, multiplied by (ii) the Theatre Access Pool
Percentage.  It is possible that the 4.03
Theatre Access Fee could be a negative number.

“Advertising-Related EBITDA”
means, for the applicable measurement period, LLC EBITDA, less the sum of
Meeting Services EBITDA, Digital Programming EBITDA and Non-Service EBITDA.

“Aggregate 4.03 Opt-In Attendance”
means, with respect to any advertising campaign that is displayed by some but
not all Founding Members pursuant to Section 4.03(i), (iii), (iv), (v) or (vi),
the sum of attendance for each of the Founding Members that participate in such
advertising campaign, with such attendance calculated for the applicable fiscal
month pursuant to the definition of Regal Attendance, Cinemark Attendance and
AMC Attendance, as applicable.

“Aggregate 4.03 Opt-In Revenue”
means the sum of all 4.03 Revenue for each advertising campaign that any
Founding Member opted not to display pursuant to Section 4.03(i), (iii), (iv),
(v) or (vi) during the applicable measurement period.

“Aggregate Theatre Access Fee”
means the sum of the Theatre Access Fee and the comparable theatre access fee
payments made to Cinemark and AMC for the applicable period.

“Aggregate
Theatre Access Pool” means the sum of the Regal Theatre
Access Pool plus the comparable calculations for Cinemark and AMC.

“AMC
Attendance” means the total number of patrons in all AMC
Theatre auditoriums (excluding auditoriums that do not run the applicable
advertising due to human or technical error within AMC’s control, AMC’s failure
to allow LLC to upgrade the Software or Equipment, AMC’s failure to install
Equipment pursuant to its obligations under Section 3.04 of its Exhibitor
Services Agreement or, after notice and opportunity to cure as set forth in
Section 3.08(b) of its Exhibitor Services Agreement, as the result of AMC’s
failure to repair or replace any AMC Equipment or AMC’s (or its Affiliates’)
software installed at any Theatre, if such obligation to repair or replace is
undertaken by AMC pursuant to Section 3.08(b) of its Exhibitor Services
Agreement and excluding auditoriums with IMAX Screens that do not exhibit
Inventory), during the applicable measurement period.

 1
 

“AMC
Equipment” means the Equipment owned by AMC, pursuant to the
AMC Exhibitor Agreement.

“AMC
Screen Count” means the Screen Number with respect to all AMC
Theatre screens for the applicable measurement period.

“AMC
Theatre Access Pool” means the AMC Theatre Access Pool,
calculated pursuant to the AMC Exhibitor Agreement.

“Attendance
Factor” means, as of the Effective Date, [***]% (which represents the
percentage calculated for the fourth fiscal quarter of 2006 using the formula
in the following sentence).  Effective as
of the first day of each succeeding fiscal quarter of LLC beginning with the
second fiscal quarter of 2007, the Attendance Factor shall adjust and be a
percentage equal to (i) the total revenue payable to LLC for the immediately
preceding fiscal quarter attributable to advertising exhibited in the Theatres,
Cinemark Theatres and AMC Theatres with respect to advertising contracts for
which the pricing is based on attendance, flat fee or other than number of
screens, divided by (ii) the total revenue payable to LLC for the immediately
preceding fiscal quarter attributable to all advertising exhibited by LLC in
the Theatres, Cinemark Theatres and AMC Theatres.

“Beverage Agreement Revenue”
means the aggregate revenue received by LLC related to the Beverage Agreement
and Cinemark’s and AMC’s beverage agreements for the applicable measurement
period.

“Cinemark
Attendance” means the total number of patrons in all Cinemark
Theatre auditoriums (excluding auditoriums that do not run the applicable
advertising due to human or technical error within Cinemark’s control, Cinemark’s
failure to allow LLC to upgrade the Software or Equipment, Cinemark’s failure
to install Equipment pursuant to its obligations under Section 3.04 of its
Exhibitor Services Agreement or, after notice and opportunity to cure as set
forth in Section 3.08(b) of its Exhibitor Services Agreement, as the result of
Cinemark’s failure to repair or replace any Cinemark Equipment or Cinemark’s
(or its Affiliates’) software installed at any Theatre, if such obligation to
repair or replace is undertaken by Cinemark pursuant to Section 3.08(b) of its
Exhibitor Services Agreement and excluding auditoriums with IMAX Screens that
do not exhibit Inventory), during the applicable measurement period.

“Cinemark
Equipment” means the Equipment owned by Cinemark, pursuant to
the Cinemark Exhibitor Agreement.

“Cinemark
Screen Count” means the Screen Number with
respect to all Cinemark Theatre  screens for
the applicable measurement period.

“Cinemark
Theatre Access Pool” means the Cinemark Theatre Access Pool,
calculated pursuant to the Cinemark Exhibitor Agreement.

 2
 

“Digital Programming EBITDA” means,
for the applicable measurement period, the portion of LLC EBITDA attributable
to the Digital Programming Services business line, as reasonably determined by
LLC based upon the revenues for Digital Programming Services and an estimated
allocation of expenses for such period.

“Digital Screen Number”
means the total number of Digital Screens for the applicable measurement
period, calculated as the average between the number of Digital Screens on the
last day of the preceding measurement period and the last day of the applicable
measurement period.

“Encumbered Exhibitor Allocation”
means [***].

“Encumbered Service Revenue”
means[***].

“Exclusivity EBITDA”
means [***].

“Exclusivity Percentage”
means [***].

“Exclusivity Run-Out Payment”
means, for the applicable fiscal quarter [***].

“Exhibitor
Allocation” means the sum of (i) the product of the Screen
Factor and the Regal Screen Ratio, and (ii) the product of the Attendance
Factor and the Regal Attendance Ratio.

“Gross Advertising EBITDA”
means Advertising-Related EBITDA less any Beverage Agreement Revenue.

“LLC EBITDA”
means the aggregate EBITDA of LLC for the applicable measurement period,
excluding any Exclusivity Run-Out Payments paid pursuant to this Agreement  or any Exhibitor Services Agreement.

“Meeting Services EBITDA” means,
for the applicable measurement period, the portion of LLC EBITDA attributable
to the Meeting Services business line, as reasonably determined by LLC based
upon the revenues for Meeting Services and an estimated allocation of expenses
for such period.

“Non-Encumbered Exhibitor
Allocation” means [***].

“Non-Service EBITDA”
means, for the applicable measurement period, the portion of LLC EBITDA
attributable to a business line other than Advertising Services, Meeting
Services or Digital Programming Services. 
For the avoidance of doubt, Non-Service EBITDA shall not include
Exclusivity Run-Out Payments pursuant to this Agreement or any other Exhibitor
Services Agreement.

“Regal 4.03 Opt-In Revenue”
means Regal’s proportional share of the 4.03 Revenue resulting from advertising
subject to Section 4.03(i), (iii), (iv), (v) or (vi) that was declined by
Cinemark or AMC but that Regal exhibited in the fiscal month during which LLC
provides the Advertising Services.  Regal
4.03 Opt-In Revenue shall be calculated by aggregating, for the applicable
fiscal month, the amount equal to the product of (i) the 4.03 Revenue for each
relevant advertising 

 3
 

campaign, multiplied by (ii) the following fraction
(A) the numerator of which is Regal Attendance and (B) the denominator of which
is Aggregate 4.03 Opt-In Attendance.

“Regal 4.03 Opt-Out Attendance”
means Regal Attendance calculated only with respect to Theatres that do not
display an advertising campaign pursuant to Section 4.03(viii) or (ix) of this
Agreement or because of lack of equipment to display the Video Display Program.

“Regal 4.03 Opt-Out Revenue”
means the estimate of the proportional share of additional 4.03 Revenue that
would have been available to LLC in the applicable fiscal month from an advertising
campaign that was not displayed in all Theatres pursuant to Regal’s decision
under Section 4.03(viii) or (ix) of this Agreement or lack of equipment to
display the Video Display Program.  Regal
4.03 Opt-Out Revenue shall be calculated by aggregating for the applicable
fiscal month the amount equal to the product of (i) the 4.03 Revenue for each
relevant advertising campaign, multiplied by (ii) the following fraction (A)
the numerator of which is Regal 4.03 Opt-Out Attendance and (B) the denominator
of which is 4.03 Participating Attendance.

“Regal
Attendance” means the total number of patrons in all Theatre
auditoriums (excluding auditoriums that do not run the applicable advertising
due to human or technical error within Regal’s control, Regal’s failure to
allow LLC to upgrade the Software or Equipment, Regal’s failure to install
Equipment pursuant to its obligations under Section 3.04 or, after notice and
opportunity to cure as set forth in Section 3.08(b), as the result of Regal’s
failure to repair or replace any Regal Equipment or Regal’s (or its Affiliates’)
software installed at any Theatre, if such obligation to repair or replace is
undertaken by Regal pursuant to Section 3.08(b) and excluding auditoriums with
IMAX Screens that do not exhibit Inventory), during the applicable measurement
period.

“Regal
Attendance Ratio” means the quotient of: (i) Regal
Attendance, divided by (ii) the sum of (A) the Regal Attendance, (B) the
Cinemark Attendance and (C) the AMC Attendance.

“Regal Digital Screen Count”
means the Digital Screen Number with respect to all Theatres for the applicable
measurement period.

“Regal
Screen Count” means the Screen Number with respect to all
Theatres for the applicable measurement period.

“Regal
Screen Ratio” means
the quotient of: (i) Regal Screen Count, divided by (ii) the sum of (A)
the Regal Screen Count, (B) the Cinemark Screen Count and (C) the AMC Screen
Count.

“Regal
Theatre Access Pool” means the sum of (i) the Regal Theatre
Access Attendance Fee and (ii) the Regal Theatre Access Screen Fee.

“Regal Theatre Access Attendance
Fee” means the product of (i) the Theatre Access Fee per
Patron and (ii) Regal Attendance for the applicable fiscal month.

“Regal Theatre Access Screen Fee”
means the product of (i) the Theatre Access Fee per Digital
Screen and (ii) the Regal Digital Screen Count, calculated as the average
between the 

 4
 

number of Digital Screens
on the last day of the preceding measurement period and the last day of the
applicable measurement period.

“Screen
Factor” means the percentage resulting from 1 minus the
Attendance Factor.

“Screen
Number” means, with respect to any measurement period, the
sum of the total number of screens in the applicable theatres on each day of
the applicable measurement period, all divided by the number of days in the
applicable measurement period, provided that a screen shall not be
counted for purposes of this calculation if such screen is inaccessible to
exhibit Inventory for the majority of the planned exhibitions for any
particular day (i) with respect to the Theatres: due to human or technical
error within Regal’s or its Affiliates’ control, Regal’s failure to allow LLC
to upgrade the Software or Equipment (subject to Section 3.05), Regal’s failure
to install Equipment pursuant to its obligations under Section 3.04 or, after
notice and opportunity to cure as set forth in Section 3.08(b), as the result
of Regal’s failure to repair or replace any Regal Equipment or Regal’s (or its
Affiliates’) software installed at any Theatre, if such obligation to repair or
replace is undertaken by Regal pursuant to Section 3.08(b)), (ii) with
respect to the Cinemark Theatres: due to human or technical error within
Cinemark’s or its Affiliates’ control, Cinemark’s failure to allow LLC to
upgrade the Software or Equipment (subject to Section 3.05 of its Exhibitor
Services Agreement), Cinemark’s failure to install Equipment pursuant to its
obligations under Section 3.04 of its Exhibitor Services Agreement or, after
notice and opportunity to cure as set forth in Section 3.08(b), as the result
of Cinemark’s failure to repair or replace any Cinemark Equipment or Cinemark’s
(or its Affiliates’) software installed at any Theatre, if such obligation to
repair or replace is undertaken by Cinemark pursuant to Section 3.08(b) of its
Exhibitor Services Agreement), (iii) with respect to the AMC Theatres: due to
human or technical error within AMC’s or its Affiliates’ control, AMC’s failure
to allow LLC to upgrade the Software or Equipment (subject to Section 3.05 of its
Exhibitor Services Agreement), AMC’s failure to install Equipment pursuant to
its obligations under Section 3.04 of its Exhibitor Services Agreement or,
after notice and opportunity to cure as set forth in Section 3.08(b), as the
result of AMC’s failure to repair or replace any AMC Equipment or AMC’s (or its
Affiliates’) software installed at any Theatre, if such obligation to repair or
replace is undertaken by AMC pursuant to Section 3.08(b) of its Exhibitor
Services Agreement), or (iv) if such screen is an IMAX Screen that does not
exhibit Inventory.

“Supplemental Theatre Access Fee”
means an annual payment from LLC to Regal to supplement the amount of the
Theatre Access Fee, payable only if the Aggregate Theatre Access Fee is less
than twelve percent of Aggregate Advertising Revenue for the applicable fiscal
year.  The Supplemental Theatre Access
Fee, if any, is equal to the product of (i) (A) twelve percent of Aggregate
Advertising Revenue for the relevant fiscal year minus (B) the Aggregate
Theatre Access Fee for the relevant fiscal year, and (ii) the Regal Attendance
Ratio for the relevant fiscal year.

“Theatre Access Fee” means
a monthly payment from LLC to Regal in consideration for Theatres’
participation in Advertising Services, which shall be the sum of (i) the Regal
Theatre Access Pool and (ii) the 4.03 Theatre Access Fee.

 5
 

“Theatre Access Fee per Digital
Screen” means $66.67 per month per Digital Screen as of the
Effective Date through the end of LLC’s 2007 fiscal year and shall increase 5%
annually thereafter.

“Theatre
Access Fee per Patron”
means a fee of $0.07 per Theatre patron as of the Effective Date and shall
increase 8% every five years, with the first such increase after the end of LLC’s
2011 fiscal year.  Patrons are counted as
set forth in the definition of Regal Attendance.

“Theatre Access Pool Percentage”
means (i) the Aggregate Theatre Access Pool for the applicable fiscal month,
divided by (ii) the difference between (A) Aggregate Advertising Revenue minus
(B) Aggregate 4.03 Opt-In Revenue, for the applicable fiscal month.

In addition to the
foregoing, the following terms have the meanings assigned in the Sections of
this Agreement referred to in the table below:

	
  Term

  	
   

  	
  Section

  
	
  4.03 Revenue

  	
   

  	
  4.03

  
	
  Adverting Services

  	
   

  	
  Article 1

  
	
  Affiliate

  	
   

  	
  Article 1

  
	
  Aggregate
  Advertising Revenue

  	
   

  	
  Article 1

  
	
  AMC Exhibitor
  Agreement

  	
   

  	
  Article 1

  
	
  AMC Theatre

  	
   

  	
  Article 1

  
	
  Beverage
  Agreement

  	
   

  	
  Article 1

  
	
  Cinemark
  Exhibitor Agreement

  	
   

  	
  Article 1

  
	
  Cinemark Theatre

  	
   

  	
  Article 1

  
	
  Digital Programming

  	
   

  	
  Article 1

  
	
  Digital
  Programming Services

  	
   

  	
  Article 1

  
	
  Digital Screen

  	
   

  	
  Article 1

  
	
  Digitized
  Theatre

  	
   

  	
  Article 1

  
	
  EBITDA

  	
   

  	
  Article 1

  
	
  Effective Date

  	
   

  	
  Preamble

  
	
  Encumbered
  Theatre

  	
   

  	
  4.08

  
	
  Equipment

  	
   

  	
  Article 1

  
	
  Founding Members

  	
   

  	
  Article 1

  
	
  IMAX Screens

  	
   

  	
  4.13(b)

  
	
  Inventory

  	
   

  	
  Article 1

  
	
  LLC

  	
   

  	
  Preamble

  
	
  Meeting Services

  	
   

  	
  Article 1

  
	
  Regal

  	
   

  	
  Preamble

  
	
  Regal Equipment

  	
   

  	
  Article 1

  
	
  Software

  	
   

  	
  Article 1

  
	
  Theatres

  	
   

  	
  Article 1

  

 

 6
 

B.  Exhibitor Allocation

Formula(1)

Exhibitor Allocation = (Screen Factor * Regal Screen
Ratio) + (Attendance Factor * Regal Attendance Ratio); where:

(1)                                  Screen
Factor = 1 - Attendance Factor

(2)                                  Regal
Screen Ratio = Regal Screen Count / (Regal Screen Count + Cinemark Screen Count
+ AMC Screen Count)

(a)                                  Screen
Count (for each of Regal, Cinemark and AMC) = Screen Number for that exhibitor
during the applicable measurement period

(b)                                 Screen
Number = Number of screens available in the exhibitor’s Theatres on each day of
the applicable measurement period to exhibit Inventory / Total number of days
in the applicable measurement period

(3)                                  Attendance
Factor = Percentage of advertising revenue attributable to contracts with
pricing based on any factor other than number of screens (e.g., pricing based
on attendance or flat fee) compared to total advertising revenue, as calculated
on the first day of each fiscal quarter

(4)                                  Regal
Attendance Ratio = Regal Attendance / (Regal Attendance + Cinemark Attendance +
AMC Attendance)

(a)                                  Attendance
(for each of Regal, Cinemark and AMC) = Total number of patrons in all of the
exhibitor’s Theatre auditoriums during the applicable measurement period

(1)  The meaning
of each term used in this exhibitor allocation formula is qualified by the
Definitions section of this Schedule 1.

 7
 

C.  Theatre
Access Fee

Formula(2) for Monthly
Payments of Theatre Access Fee and Annual Payments of Supplemental Theatre
Access Fee

Theatre Access Fee = Regal Theatre Access Pool + 4.03
Theatre Access Fee; where:

(1)                                  Regal
Theatre Access Pool = Regal Theatre Access Attendance Fee + Regal Theatre
Access Screen Fee

(a)                                  Regal
Theatre Access Attendance Fee = Theatre Access Fee per Patron * Regal
Attendance

(i)                                     Theatre
Access Fee per Patron = $0.07 per patron (subject to an increase of 8% every five years, with the first such
increase occurring after the end of LLC’s 2011 fiscal year)

(ii)                                  Regal
Attendance = Number of patrons in all Theatre auditoriums that exhibit the
advertising

(b)                                 Regal
Theatre Access Screen Fee = Theatre Access Fee per Digital Screen * Regal
Digital Screen Count

(i)                                     Theatre
Access Fee per Digital Screen =
$66.67 per Digital Screen (subject to a 5% annual increase, beginning after the
end of LLC’s 2007 fiscal year)

(ii)                                  Regal
Digital Screen Count = Number of
screens in Digitized Theatres that exhibit advertising

(2)                                  4.03
Theatre Access Fee = (Regal 4.03 Opt-In Revenue – Regal 4.03 Opt-Out Revenue) *
Theatre Access Pool Percentage

(a)                                  Regal
4.03 Opt-In Revenue = For each advertising campaign that is displayed by Regal
and contains content not displayed by Cinemark or AMC pursuant to Section
4.03(i), (iii), (iv), (v) or (vi) of this Agreement, the aggregate of the
products obtained from the following calculation:

4.03 Revenue for that
advertising campaign * (Regal Attendance / Aggregate 4.03 Opt-In Attendance)

(i)                                     Regal
Attendance = See Section B of this Schedule

(ii)                                  Aggregate
4.03 Opt-In Attendance = Sum of Regal Attendance, Cinemark Attendance and AMC
Attendance, as applicable, for the Founding Members that displayed such 4.03
content

(b)                                 Regal
Opt-Out Revenue = For each advertising campaign that is not displayed in all
Theatres pursuant to Regal’s decision under Section 4.03(viii) or (ix) of this
Agreement or lack of equipment to display the Video Display Program, the
aggregate of the products obtained by the following calculation:

(2)  The
meaning of each term used in this Theatre Access Fee formula and Supplemental
Theatre Access Fee formula is qualified by the definitions in Section A of this
Schedule 1.

 8
 

4.03 Revenue for that
advertising campaign * (Regal 4.03 Opt-Out Attendance / 4.03 Participating
Attendance)

(i)                                     Regal
4.03 Opt-Out Attendance = Regal Attendance during the applicable fiscal month
at Theatres that did not display content pursuant to Section 4.03(viii) or (ix)
of this Agreement or because of lack of equipment to display the Video Display
Program

(ii)                                  4.03
Participating Attendance = Sum of Regal Attendance, Cinemark Attendance and AMC
Attendance at Theatres, Cinemark Theatres and AMC Theatres that displayed such
content

(c)                                  Theatre
Access Pool Percentage = Aggregate Theatre Access Pool / (Aggregate Advertising
Revenue – Aggregate 4.03 Opt-In Revenue)

(i)                                     Aggregate
Theatre Access Pool = Sum of Regal Theatre Access Pool + Cinemark Theatre
Access Pool + AMC Theatre Access Pool

(ii)                                  Aggregate
Advertising Revenue = LLC’s revenue related to Advertising Services, except
Event Sponsorships, revenue related to relationships with third parties that
are not Founding Members and Advertising Services provided to Founding Members
outside the provisions of this Agreement

(iii)                               Aggregate
4.03 Opt-In Revenue = The aggregate of all 4.03 Revenue for each advertising
campaign that any Founding Member opted not to display pursuant to Section
4.03(i), (iii), (iv), (v) or (vi).

Supplemental
Theatre Access Fee = If Aggregate Theatre Access Fee < (12% * Aggregate
Advertising Revenue):

((12% * Aggregate
Advertising Revenue) – Aggregate Theatre Access Fee)) * Regal Attendance Ratio;
where:

(1)                                  Aggregate
Theatre Access Fee = Sum of Theatre Access Fee plus the comparable theatre
access fee payments made to Cinemark and AMC for the same period

(2)                                  Regal
Attendance Ratio = See Section B of this Schedule

 9
 

D.  Exclusivity Run-Out Payment

Formula(3)
for Quarterly Payments

Exclusivity
Run-Out Payment = [***]

(3)  The meaning
of each term used in this Exclusivity Run-Out Payment formula is qualified by
the definitions in Section A of this Schedule 1.

 10Exhibit 10.2

PROMISSORY
NOTE

	
  $52,115,000.00

  	
   

  	
  New York, New York

  
	
   

  	
   

  	
  May 2, 2007

  

 

FOR VALUE RECEIVED, BEHRINGER HARVARD SANTA CLARA LP, a Delaware limited
partnership (the “Maker”), promises to pay to the order of CITIGROUP
GLOBAL MARKETS REALTY CORP., a New York corporation (the “Payee”),
at its principal place of business at 388 Greenwich Street, Floor 11, New York,
New York 10013, or at such other place as the holder hereof may from time to
time designate in writing, the principal sum of FIFTY-TWO MILLION ONE HUNDRED
FIFTEEN THOUSAND  AND 00/100 DOLLARS
($52,115,000.00), in lawful money of the United States of America with interest
thereon to be computed from the date of this Note to an including the date this
Note is paid in full at the rate of 7.07% per annum (the “Applicable Interest
Rate”).  The Debt (hereinafter defined)
shall be paid on June 15, 2007 (the “Maturity Date”). Interest on the principal
sum of the Note shall be calculated on the basis of a three hundred sixty (360)
day year and paid on the actual number of days elapsed.

The whole of the principal sum of this Note, together with all interest
accrued and unpaid thereon and all other sums due under this Note (all such
sums hereinafter collectively referred to as the “Debt”) shall without notice
become immediately due and payable at the option of Payee on the happening of
any default hereunder or the breach of any covenant contained herein or any
default under that certain letter from Borrower to Lender dated May 2, 2007
(the “Fee Letter”) or if any representation or warranty made herein is not true
and correct or if the principal balance of this Note or any other sums due
hereunder are not paid on the Maturity Date (hereinafter collectively an “Event
of Default”).  In the event that it
should become necessary to employ counsel to collect the Debt, Maker also
agrees to pay reasonable attorney’s fees for the services of such counsel
whether or not suit is brought.

Maker shall pay the outstanding principal balance of
the Note together with all accrued interest and all other outstanding amounts
then due and unpaid under this Note on the Maturity Date.

Maker may, at its option, repay the Debt in
whole at any time prior to the Maturity Date without penalty or fee, except as
set forth in the Fee Letter.

On the date hereof, Maker shall deposit with Payee
the sum of $460,566.31 (the “Interest Reserve”) as additional collateral for
the Loan.  On the Maturity Date, Payee
shall apply the Interest Reserve first to all interest on the Debt which has
accrued at the Applicable Interest Rate, second to all other outstanding
amounts then due and unpaid under this Note, and finally to the outstanding
principal balance of this Note.

Maker does hereby agree that upon the occurrence of an Event of Default
or upon the failure of Maker to pay the Debt in full on the Maturity Date,
Payee shall be entitled to receive and Maker shall pay interest on the entire
unpaid principal sum at the rate of 12.07% per annum or at the maximum rate of
interest which Maker may by law pay, whichever is lower, to be computed from
the occurrence of the Event of Default until the actual receipt and collection 

of the Debt. 
This charge shall be added to the Debt. 
This clause, however, shall not be construed as an agreement or
privilege to extend the date of the payment of the Debt, nor as a waiver of any
other right or remedy accruing to Payee by reason of the occurrence of any
Event of Default.

Whenever used, the singular number shall include the plural, the plural
the singular, and the words “Payee” and “Maker” shall include their respective
successors, assigns, heirs, executors and administrators.

This Note is subject to the express condition that at no time shall
Maker be obligated or required to pay interest on the principal balance due
hereunder at a rate which could subject Payee to either civil or criminal
liability as a result of being in excess of the maximum interest rate which
Maker is permitted by applicable law to contract or agree to pay.  If by the terms of this Note, Maker is at any
time required or obligated to pay interest on the principal balance due
hereunder at a rate in excess of such maximum rate, the Applicable Interest
Rate shall be deemed to be immediately reduced to such maximum rate and all previous
payments in excess of the maximum rate shall be deemed to have been payments in
reduction of principal and not on account of the interest due hereunder.

This Note may not be modified, amended, waived, extended, changed,
discharged or terminated orally or by any act or failure to act on the part of
Maker or Payee, but only by an agreement in writing signed by the party against
whom enforcement of any modification, amendment, waiver, extension, change,
discharge or termination is sought.

If Maker consists of more than one person or party, the obligations and
liabilities of each such person or party shall be joint and several.

Maker and all others who may become liable for the payment of all or
any part of the Debt do hereby severally waive presentment and demand for
payment, notice of dishonor, protest and notice of protest and
non-payment.  No extension of time for
payment of this Note or any installment hereof, and no alteration, amendment or
waiver of any provision of this Note, made by agreement between Payee and any
other person or party shall release, modify, amend, waive, extend, change,
discharge, terminate or affect the liability of Maker, and any other who may
become liable for the payment of all or any part of the Debt, under this Note.

Maker represents and warrants that:

(a)           Authority.  Maker has the full power and authority to
execute and deliver this Note and to perform its obligations hereunder.  If Maker is not an individual: (i) Maker is
duly organized, validly existing and in good standing under the laws of the
state of its formation, and (ii) the execution, delivery and performance of
this Note by Maker has been duly and validly authorized and the person(s)
signing this Note on Maker’s behalf has been validly authorized and directed to
sign this Note.

(b)           Valid
and Binding Obligation.  This Note
constitutes Maker’s legal, valid and binding obligation, enforceable against it
in accordance with its terms, except to the extent enforceability may be
limited under applicable bankruptcy and 

 2
 

insolvency laws
and similar laws affecting creditors’ rights generally and to general
principles of equity.

(c)           No
Conflict with Other Agreement.  Maker’s
execution, delivery and performance of this Note will not (i) violate
Maker’s organizational documents if Maker is not an individual, (ii) result in
the breach of, or conflict with, or result in the acceleration of, any
obligation under any guaranty, indenture, credit facility or other instrument
to which Maker or any of its assets may be subject, or (iii) violate any order,
judgment or decree to which Maker or any of its assets is subject.

(d)           No
Pending Litigation.  No action, suit,
proceeding or investigation currently is pending or, to the best of Maker’s
knowledge, threatened against Maker which, either in any one instance or in the
aggregate, may have a material, adverse effect on Maker’s ability to perform
its obligations under this Note.

(e)           Bankruptcy.  Maker is not contemplating either the filing
of a petition by it under any state or federal bankruptcy or insolvency laws or
the liquidation of all or a major portion of Maker’s assets, and the Maker has
no knowledge of any person contemplating the filing of any such petition
against Maker.

(f)            Solvency.  After giving effect to this Note, Maker shall
be solvent.

From the date hereof and until repayment of the Debt in full and
performance in full of all obligations of Maker under this Note and the Fee
Letter, Maker hereby covenants and agrees with Payee that:

(a)           No Property Encumbrance.  Maker shall not, whether voluntarily or
involuntarily, sell, convey, mortgage, grant, bargain, encumber, pledge,
assign, grant any options with respect to, or any other transfer or disposition
of (directly or indirectly, voluntarily or involuntarily, by operation of law or
otherwise, and whether or not for consideration or of record) of a legal or
beneficial interest in that certain property known as the Hitachi Data Center,
700 Central Expressway, 750 Central Expressway an 800 Central Expressway, Santa
Clara California (the “Property”).

(b)           No Transfers.  Maker shall not, and shall not permit, the
voluntary or involuntary sale, conveyance, mortgage, grant, bargain,
encumbrance, pledge, assignment, grant of any options with respect to, or any
other transfer or disposition of (directly or indirectly, voluntarily or
involuntarily, by operation of law or otherwise, and whether or not for
consideration or of record) of a legal or beneficial interest in Maker.

Maker shall not make or
pay or agree to become or remain liable for any dividend or other distribution
of any nature (whether in cash, property, securities or otherwise) (A) on
account of or in respect of its shares of capital stock, partnership interests
or limited liability company interests, or (B) on account of the purchase,
redemption, retirement or acquisition of its shares of capital stock (or
warrants, options or rights therefor), partnership interests or limited
liability company interests until the Debt has been repaid in full.

 3
 

Upon the occurrence and during the continuance of an Event of Default
and at any time and from time to time thereafter during the continuance of such
Event of Default, in addition to any other rights or remedies available to it
pursuant to this Note or at law or in equity, Payee may take such action,
without notice or demand, that Lender deems advisable to protect and enforce
its rights against Borrower; including declaring the Debt to be immediately due
and payable (including unpaid interest), without notice or demand; and Maker
hereby expressly waives any such notice or demand, anything contained herein or
in the Fee Letter to the contrary notwithstanding.

Upon the occurrence and during the continuance of an Event of Default,
all or any one or more of the rights, powers, privileges and other remedies
available to Payee against Maker under the Note or the Fee Letter or at law or
in equity may be exercised by Payee at any time and from time to time, whether
or not all or any of the Debt shall be declared, or be automatically, due and
payable, and whether or not Payee shall have commenced any action for the
enforcement of its rights and remedies under this Note or the Fee Letter.  Any such actions taken by Payee shall be
cumulative and concurrent and may be pursued independently, singly, successively,
together or otherwise, at such time and in such order as Payee may determine in
its discretion, to the fullest extent permitted by law, without impairing or
otherwise affecting the other rights and remedies of Payee permitted by law,
equity or contract or as set forth in the Loan Documents.

All sums due under this Note shall be fully recourse to Borrower.

This Note shall be governed and construed in accordance with the laws
of the State of New York and the applicable laws of the United States of
America.

 4

IN WITNESS WHEREOF, Maker has duly executed this Note the day and year
first above written.

	
  

  	
   

  	
  BEHRINGER HARVARD
  SANTA CLARA LP, a  

  Delaware limited partnership

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  BEHRINGER HARVARD
  SANTA CLARA 

  GP, LLC,
  a Delaware limited liability 

  company, its general partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/
  Gerald J. Reihsen, III

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:
  

  	
  Gerald
  J. Reihsen, III

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Executive
  Vice President

  

 

 5

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