As filed with the Securities and Exchange Commission on April 18, 2007
Registration No. 333-140390
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
Amendment No. 3
to
Form S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
 
 
Cinemark Holdings, Inc.
(Exact Name of Registrant as Specified in Its Charter)
 
         
Delaware   7832   20-5490327
(State or Other Jurisdiction of
Incorporation or Organization)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification Number)
 
 
3900 Dallas Parkway, Suite 500
Plano, Texas 75093
(972) 665-1000
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant’s Principal Executive Offices)
 
Michael Cavalier
Senior Vice President-General Counsel
3900 Dallas Parkway, Suite 500
Plano, Texas 75093
(972) 665-1000
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
 
 
With a copy to:
     
Terry M. Schpok, P.C.
Akin Gump Strauss Hauer & Feld LLP
1700 Pacific Avenue, Suite 4100
Dallas, Texas 75201
Telephone: (214) 969-2800
  D. Rhett Brandon, Esq.
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
Telephone: (212) 455-3615
 
Approximate date of commencement of proposed sale to the public:   As soon as practicable after the effective date of this Registration Statement.
 
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.   o
 
If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o   _ _
 
If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   o   _ _
 
If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   o   _ _
 
 
 
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
 


 

EXPLANATORY NOTE
     Cinemark Holdings, Inc. has prepared this Amendment No. 3 to the Registration Statement on Form S-1 (File No. 333-140390) for the sole purpose of filing Exhibit Numbers 1, 4.6, 5, 10.10(a) through 10.36(f) and 23.3 with the Securities and Exchange Commission. Amendment No. 3 does not modify any provision of the Prospectus that forms a part of the Registration Statement and accordingly such Prospectus has not been included herein.


 

PART II
 
INFORMATION NOT REQUIRED IN PROSPECTUS
 
Item 13.   Other Expenses of Issuance and Distribution.
 
The following table sets forth the costs and expenses, other than underwriting discounts and commissions, to be paid by the registrant in connection with the issuance and distribution of the shares of common stock being registered hereby. All amounts are estimates except for the Securities and Exchange Commission registration fee, the NASD filing fee and the New York Stock Exchange listing fee. The selling stockholders will not pay any of the registration expenses.
 
         
Securities and Exchange Commission registration fee
  $ 48,486  
NASD filing fee
  $ 59,020  
New York Stock Exchange listing fee
  $ 185,340  
Accounting fees and expenses
  $ 750,000  
Legal fees and expenses
  $ 900,000  
Printing and engraving expenses
  $      500,000  
Blue Sky qualification fees and expenses
  $      5,000  
Transfer agent and registrar fees and expenses
  $      20,000  
Miscellaneous expenses
  $      232,154  
         
Total
  $      2,700,000  
         
 
Item 14.    Indemnification of Directors and Officers
 
Section 145 of the Delaware General Corporation Law permits a corporation, under specified circumstances, to indemnify its directors, officers, employees or agents against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlements actually and reasonably incurred by them in connection with any action, suit or proceeding brought by third parties by reason of the fact that they were or are directors, officers, employees or agents of the corporation, if such directors, officers, employees or agents acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reason to believe their conduct was unlawful. In a derivative action, i.e., one by or in the right of the corporation, indemnification may be made only for expenses actually and reasonably incurred by directors, officers, employees or agents in connection with the defense or settlement of an action or suit, and only with respect to a matter as to which they shall have acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made if such person shall have been adjudged liable to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine upon application that the defendant directors, officers, employees or agents are fairly and reasonably entitled to indemnity for such expenses despite such adjudication of liability.
 
Section 102(b)(7) of the Delaware General Corporation Law provides that a certificate of incorporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director provided that such provision shall not eliminate or limit the liability of a director:
 
(1) for any breach of the director’s duty of loyalty to the corporation or its stockholders;
 
(2) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;
 
(3) under Section 174 (relating to liability for unauthorized acquisitions or redemptions of, or dividends on, capital stock) of the Delaware General Corporation Law; or
 
(4) for any transaction from which the director derived an improper personal benefit.


II-1


 

Section 145 of the Delaware General Corporation Law further authorizes a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation against any liability asserted against and incurred by such person in any such capacity, or arising out of such person’s status as such.
 
Our amended and restated certificate of incorporation provides that we may, to the fullest extent permitted by Delaware General Corporation Law, indemnify all persons whom it may indemnify under Delaware law and contains provisions permitted by Section 102(b)(7) of the Delaware General Corporation Law.
 
Our certificate of incorporation and bylaws provide that:
 
  •  we are required to indemnify our directors and officers, subject to very limited exceptions;
 
  •  we may indemnify other employees and agents, subject to very limited exceptions;
 
  •  we are required to advance expenses, as incurred, to our directors and officers in connection with a legal proceeding, subject to very limited exceptions; and
 
  •  we may advance expenses, as incurred, to our employees and agents in connection with a legal proceeding.
 
The indemnification provisions in our amended and restated certificate of incorporation and bylaws may be sufficiently broad to permit indemnification of our directors and officers for liabilities arising under the Securities Act.
 
Reference is also made to the form of Underwriting Agreement, filed with this registration statement as Exhibit 1, which provides for the indemnification of our officers, directors and controlling persons against certain liabilities.
 
We have obtained an insurance policy providing for indemnification of officers and directors and certain other persons against liabilities and expenses incurred by any of them in certain stated proceedings and conditions.
 
Item 15.    Recent Sales of Unregistered Securities
 
On August 2, 2006, Cinemark Holdings, Inc. was formed as a Delaware holding company of Cinemark, Inc. On October 5, 2006, our subsidiary, Cinemark USA, Inc., completed the acquisition of Century Theatres, Inc., for a purchase price of approximately $681 million and the assumption of debt of Century. A portion of the purchase price consisted of the issuance of 10,024,776 shares of our common stock. The closing of the acquisition of Century involved the following transactions:
 
  •  Pursuant to a stock purchase agreement, dated August 7, 2006, and amendment thereto, dated October 4, 2006, among Cinemark USA, Inc., Century and Syufy Enterprise, LP, Cinemark USA, Inc. acquired approximately 77% of the issued and outstanding capital stock of Century.
 
  •  Pursuant to a contribution and exchange agreement, dated August 7, 2006, by and between Syufy, Cinemark, Inc., Century Theatres Holdings, LLC and Cinemark Holdings, Inc., Syufy contributed the remaining shares of capital stock of Century to Cinemark Holdings in exchange for 10,024,776 shares of Cinemark Holdings.
 
  •  Pursuant to a share exchange agreement, dated August 7, 2006, by and among Cinemark Holdings, Inc. and then current stockholders of Cinemark, Inc., the stockholders, immediately prior to the consummation of the transactions contemplated by the purchase agreement and the contribution and exchange agreement referenced above, exchanged their 82,531,243 shares of common stock of Cinemark, Inc. for an equal number of shares of Cinemark Holdings common stock.
 
In December 2006, we issued 4,603 shares upon the exercise of options outstanding under our 2006 Long Term Incentive Plan.
 
The sales and issuances of securities described above were deemed to be exempt from registration under the Securities Act in reliance upon Section 4(2) of the Securities Act or Regulation D or Rule 701 promulgated thereunder.


II-2


 

Item 16.    Exhibits and Financial Statement Schedules.
 
(a) The following exhibits are filed herewith:
 
         
Number
 
Exhibit Title
 
  *1     Form of Underwriting Agreement.
  2 .1   Stock Contribution and Exchange Agreement, dated as of August 7, 2006, by and between Cinemark Holdings, Inc., Cinemark, Inc., Syufy Enterprises, LP and Century Theatres Holdings, LLC (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on August 11, 2006).
  2 .2   Contribution and Exchange Agreement, dated as of August 7, 2006, by and among Cinemark Holdings, Inc. and Lee Roy Mitchell, The Mitchell Special Trust, Alan W. Stock, Timothy Warner, Robert Copple, Michael Cavalier, Northwestern University, John Madigan, Quadrangle Select Partners LP, Quadrangle Capital Partners A LP, Madison Dearborn Capital Partners IV, L.P., K&E Investment Partners, LLC — 2004-B-DIF, Piola Investments Ltd., Quadrangle (Cinemark) Capital Partners LP and Quadrangle Capital Partners LP (incorporated by reference to Exhibit 10.3 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on August 11, 2006).
  **3 .1   Second Amended and Restated Certificate of Incorporation of Cinemark Holdings, Inc. filed with the Delaware Secretary of State on April 9, 2007.
  **3 .2   Amended and Restated Bylaws of Cinemark Holdings, Inc. dated April 9, 2007.
  **4 .1   Specimen stock certificate of Cinemark Holdings, Inc.
  4 .2(a)   Indenture, dated as of March 31, 2004, between Cinemark, Inc. and The Bank of New York Trust Company, N.A. governing the 9 3 / 4 % senior discount notes issued thereunder (incorporated by reference to Exhibit 4.2(a) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
  4 .2(b)   Form of 9 3 / 4 % senior discount notes (contained in the indenture listed as Exhibit 4.2(a) above) (incorporated by reference to Exhibit 4.2(b) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
  4 .3(a)   Indenture, dated as of February 11, 2003, between Cinemark USA, Inc. and The Bank of New York Trust Company of Florida, N.A. governing the 9% senior subordinated notes issued thereunder (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K (File 033-47040) filed March 19, 2003).
  4 .3(b)   First Supplemental Indenture, dated as of May 7, 2003, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference from Exhibit 4.2(i) to Cinemark USA, Inc.’s Registration Statement on Form S-4/A (File No. 333-104940) filed May 28, 2003).
  4 .3(c)   Second Supplemental Indenture dated as of November 11, 2004, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference to Exhibit 4.2(c) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-047040, filed March 28, 2005).
  4 .3(d)   Third Supplemental Indenture, dated as of October 5, 2006, among Cinemark USA, Inc., the subsidiaries of Cinemark USA, Inc. named therein, and The Bank of New York Trust Company, N.A., as trustee (incorporated by reference to Exhibit 10.7 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on October 12, 2006).
  4 .3(e)   Form of 9% Senior Subordinated Note, Due 2013 (contained in the Indenture listed as Exhibit 4.3(a) above) (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K (File 033-47040) filed March 19, 2003).
  4 .4   Stockholders Agreement, dated as of August 7, 2006, effective October 5, 2006, by and among Cinemark Holdings, Inc. and the stockholders party thereto (incorporated by reference to Exhibit 4.4 to Cinemark Holdings, Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).


II-3


 

         
Number
 
Exhibit Title
 
  4 .5   Registration Agreement, dated as of August 7, 2006, effective October 5, 2006, by and among Cinemark Holdings, Inc. and the stockholders party thereto (incorporated by reference to Exhibit 4.5 to Cinemark Holdings Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).
  *4 .6   Form of Director Nomination Agreement among Cinemark Holdings, Inc. and the stockholders party thereto.
  *5     Opinion of Akin Gump Strauss Hauer & Feld LLP.
  10 .1(a)   Management Agreement, dated December 10, 1993, between Laredo Theatre, Ltd. and Cinemark USA, Inc. (incorporated by reference to Exhibit 10.14(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 31, 1994).
  10 .1(b)   First Amendment to Management Agreement of Laredo Theatre, Ltd., effective as of December 10, 2003, between CNMK Texas Properties, Ltd. (successor in interest to Cinemark USA, Inc.) and Laredo Theatre Ltd. (incorporated by reference to Exhibit 10.1(d) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
  10 .2   Amended and Restated Agreement to Participate in Profits and Losses, dated as of March 12, 2004, between Cinemark USA, Inc. and Alan W. Stock (incorporated by reference to Exhibit 10.2 to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  10 .3   License Agreement, dated December 10, 1993, between Laredo Joint Venture and Cinemark USA, Inc. (incorporated by reference to Exhibit 10.14(c) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 31, 1994).
  10 .4(a)   Tax Sharing Agreement, between Cinemark USA, Inc. and Cinemark International, L.L.C. (f/k/a Cinemark II, Inc. ), dated as of June 10, 1992 (incorporated by reference to Exhibit 10.22 to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 31, 1993).
  10 .4(b)   Tax Sharing Agreement, dated as of July 28, 1993, between Cinemark USA, Inc. and Cinemark Mexico (USA) (incorporated by reference to Exhibit 10.10 to Cinemark Mexico (USA)’s Registration Statement on Form S-4, File No. 033-72114, filed on November 24, 1993).
  +10 .5(a)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Lee Roy Mitchell (incorporated by reference to Exhibit 10.14(a) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(b)   First Amendment to Employment Agreement, effective as of December 12, 2006, by and between Cinemark, Inc. and Lee Roy Mitchell (incorporated by reference to Exhibit 10.1 to Cinemark, Inc.’s Current Report on Form 8-K, File No. 001-31372, filed December 18, 2006).
  +10 .5(c)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Alan Stock (incorporated by reference to Exhibit 10.14(b) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(d)   First Amendment to Employment Agreement, effective as of December 12, 2006, by and between Cinemark, Inc. and Alan W. Stock (incorporated by reference to Exhibit 10.2 to Cinemark, Inc.’s Current Report on Form 8-K, File No. 001-31372, filed December 18, 2006).
  +10 .5(e)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Tim Warner (incorporated by reference to Exhibit 10.14(c) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(f)   First Amendment to Employment Agreement, effective as of December 12, 2006, by and between Cinemark, Inc. and Timothy Warner (incorporated by reference to Exhibit 10.3 to Cinemark, Inc.’s Current Report on Form 8-K, File No. 001-31372, filed December 18, 2006).
  +10 .5(g)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Robert Copple (incorporated by reference to Exhibit 10.14(d) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(h)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Rob Carmony (incorporated by reference to Exhibit 10.14(e) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).

II-4


 

         
Number
 
Exhibit Title
 
  +10 .5(i)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Tandy Mitchell (incorporated by reference to Exhibit 10.14(f) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(j)   First Amendment to Employment Agreement, dated January 25, 2007, between Cinemark, Inc. and Robert Copple (incorporated by reference to Exhibit 10.5(j) to Cinemark Holdings, Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).
  10 .6(a)   Credit Agreement, dated as of October 5, 2006, among Cinemark Holdings, Inc., Cinemark, Inc., CNMK Holding, Inc., Cinemark USA, Inc., the several banks and other financial institutions or entities from time to time parties to the Agreement, Lehman Brothers Inc. and Morgan Stanley Senior Funding, Inc., as joint lead arrangers and joint bookrunners, Morgan Stanley Senior Funding, Inc., as syndication agent, BNP Paribas and General Electric Capital Corporation as co-documentation agents, and Lehman Commercial Paper Inc., as administrative agent (incorporated by reference to Exhibit 10.5 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on October 12, 2006).
  **10 .6(b)   First Amendment to Credit Agreement dated as of March 14, 2007 among Cinemark Holdings, Inc., Cinemark, Inc., CNMK Holding, Inc., Cinemark USA, Inc., the several banks and other financial institutions or entities from time to time parties thereto, Lehman Brothers Inc. and Morgan Stanley Senior Funding, Inc., as joint lead arrangers and joint bookrunners, Morgan Stanley Senior Funding, Inc., as syndication agent, BNP Paribas and General Electric Capital Corporation, as co-documentation agents, and Lehman Commercial Paper Inc., as administrative agent.
  10 .6(c)   Guarantee and Collateral Agreement, dated as of October 5, 2006, among Cinemark Holdings, Inc., Cinemark, Inc., CNMK Holding, Inc., Cinemark USA, Inc. and each subsidiary guarantor party thereto (incorporated by reference to Exhibit 10.6 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on October 12, 2006).
  **+10 .7(a)   Cinemark Holdings, Inc. 2006 Long Term Incentive Plan, dated December 22, 2006.
  **+10 .7(b)   Form of Stock Option Agreement.
  **#10 .8   Exhibitor Services Agreement, dated as of February 13, 2007, by and between National CineMedia, LLC and Cinemark USA, Inc.
  **10 .9   Third Amended and Restated Limited Liability Company Operating Agreement, dated as of February 12, 2007, by and between Cinemark Media, Inc., American Multi-Cinema, Inc., Regal CineMedia, LLC and National CineMedia, Inc.
  *#10 .10(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .10(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .10(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *10 .10(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .10(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .11(a)   Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.

II-5


 

         
Number
 
Exhibit Title
 
  *#10 .11(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *10 .11(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *10 .11(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *#10 .11(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *#10 .12(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .12(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .12(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *10 .12(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .12(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .13(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *#10 .13(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *10 .13(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *10 .13(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *#10 .13(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *#10 .14(a)   Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *#10 .14(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *10 .14(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14 at Folsom, CA.

II-6


 

         
Number
 
Exhibit Title
 
  *10 .14(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *#10 .14(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *#10 .15(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *#10 .15(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *10 .15(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *10 .15(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *#10 .15(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *#10 .16(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .16(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .16(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *10 .16(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .16(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .17(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *#10 .17(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *10 .17(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *10 .17(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *#10 .17(e)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.

II-7


 

         
Number
 
Exhibit Title
 
  *#10 .18(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *10 .18(b)   First Amendment, dated as of October 31, 1996, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .18(c)   Second Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .18(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *10 .18(e)   Fourth Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .18(f)   Fifth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .19(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .20(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .20(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *10 .20(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .20(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .20(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .21(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.

II-8


 

         
Number
 
Exhibit Title
 
  *#10 .21(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .21(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *10 .21(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .21(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .22(a)   Indenture of Lease, dated as of September 30, 1995, by and between Sycal Properties, Inc. (succeeded by Syufy Properties, Inc.), as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .22(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *10 .22(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .22(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .22(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .23(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *#10 .23(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *10 .23(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *10 .23(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *#10 .23(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *#10 .24(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .24(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .24(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.

II-9


 

         
Number
 
Exhibit Title
 
  *10 .24(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .24(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .25(a)   Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *10 .25(b)   First Amendment, dated as of April 15, 2005, to Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *10 .25(c)   Second Amendment, dated as of September 29, 2005, to Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *#10 .25(d)   Third Amendment, dated as of August 5, 2006, to Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *#10 .26(a)   Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *10 .26(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *10 .26(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *#10 .26(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *#10 .27(a)   Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *10 .27(b)   First Amendment, dated as of April 15, 2005, to Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *10 .27(c)   Second Amendment, dated as of September 29, 2005, to Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *10 .27(d)   Third Amendment, dated as of August 5, 2006, to Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *#10 .28(a)   Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *10 .28(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *10 .28(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.

II-10


 

         
Number
 
Exhibit Title
 
  *#10 .28(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *#10 .29(a)   Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *10 .29(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *10 .29(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *#10 .29(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *#10 .30(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Rancho Santa Fe 16, Las Vegas, NV.
  *#10 .30(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Rancho Santa Fe 16, Las Vegas, NV.
  *#10 .30(c)   Second Amendment, dated as of September 30, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Rancho Santa Fe 16, Las Vegas, NV.
  *#10 .31(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .31(b)   First Amendment, dated as of October 1, 1996, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .31(c)   Second Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *10 .31(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .31(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .32(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *#10 .32(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *10 .32(c)   Second Amendment, dated as of October 1, 2001, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *#10 .32(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.

II-11


 

         
Number
 
Exhibit Title
 
  *#10 .33(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *10 .33(b)   First Amendment, dated as of January 4, 1998, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *#10 .33(c)   Second Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *10 .33(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *10 .33(e)   Fourth Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *#10 .33(f)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *#10 .34(a)   Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .34(b)   First Amendment, dated as of April 30, 2003, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .34(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *10 .34(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .34(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .35(a)   Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *10 .35(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *10 .35(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *#10 .35(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *#10 .36(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *#10 .36(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.

II-12


 

         
Number
 
Exhibit Title
 
  *10 .36(c)   Second Amendment, dated as of October 1, 2001, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *10 .36(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *10 .36(e)   Fourth Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *#10 .36(f)   Fifth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  10 .37   Stock Purchase Agreement, dated as of August 7, 2006, by and among Cinemark USA, Inc, Cinemark Holdings, Inc., Syufy Enterprises LP, Century Theatres, Inc. and Century Theatres Holdings, LLC (incorporated by reference to Exhibit 10.1 to current Report on Form 8-K, File No, 000-47040, filed by Cinemark USA, Inc. with the SEC on August 11, 2006)
  **21     Subsidiaries of the registrant.
  **23 .1   Consent of Deloitte & Touche LLP.
  **23 .2   Consent of Grant Thornton LLP.
  *23 .3   Consent of Akin Gump Strauss Hauer & Feld LLP (included in the opinion filed as Exhibit 5 to this Registration Statement).
  24     Power of Attorney (included on the signature page of Cinemark Holdings, Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).
  **99 .1   Consent of PricewaterhouseCoopers LLP.
  **99 .2   Consent of BIA Financial Network, Inc.
 
 
 * Filed herewith
 ** Previously filed
 # Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.
+ Management contract, compensatory plan or arrangement.

II-13


 

SIGNATURES
 
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Plano, State of Texas, on April 18, 2007.
 
CINEMARK HOLDINGS, INC.
 
  By: 
/s/   ALAN W. STOCK
Alan W. Stock, Chief Executive Officer
 
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
 
             
Name
 
Title
 
Date
 
*

Lee Roy Mitchell
  Chairman of the Board of Directors and Director   April 18, 2007
         
/s/  ALAN W. STOCK

Alan W. Stock
  Chief Executive Officer
(principal executive officer)
  April 18, 2007
         
/s/  ROBERT COPPLE

Robert Copple
  Executive Vice President; Treasurer and Chief Financial Officer
(principal financial and
accounting officer)
  April 18, 2007
         
*

Benjamin D. Chereskin
  Director   April 18, 2007
         
*

James N. Perry, Jr.
  Director   April 18, 2007
         
*

Robin P. Selati
  Director   April 18, 2007
         

*

Vahe A. Dombalagian
  Director   April 18, 2007
         
*

Peter R. Ezersky
  Director   April 18, 2007
         
*

Enrique F. Senior
  Director   April 18, 2007
         
*

Raymond W. Syufy
  Director   April 18, 2007
*

Joseph E. Syufy
  Director   April 18, 2007
             
*By:  
/s/  MICHAEL CAVALIER

Michael Cavalier
Attorney-in-Fact
       


II-15


 

EXHIBIT INDEX
 
         
Number
 
Exhibit Title
 
  *1     Form of Underwriting Agreement.
  2 .1   Stock Contribution and Exchange Agreement, dated as of August 7, 2006, by and between Cinemark Holdings, Inc., Cinemark, Inc., Syufy Enterprises, LP and Century Theatres Holdings, LLC (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on August 11, 2006).
  2 .2   Contribution and Exchange Agreement, dated as of August 7, 2006, by and among Cinemark Holdings, Inc. and Lee Roy Mitchell, The Mitchell Special Trust, Alan W. Stock, Timothy Warner, Robert Copple, Michael Cavalier, Northwestern University, John Madigan, Quadrangle Select Partners LP, Quadrangle Capital Partners A LP, Madison Dearborn Capital Partners IV, L.P., K&E Investment Partners, LLC — 2004-B-DIF, Piola Investments Ltd., Quadrangle (Cinemark) Capital Partners LP and Quadrangle Capital Partners LP (incorporated by reference to Exhibit 10.3 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on August 11, 2006).
  **3 .1   Second Amended and Restated Certificate of Incorporation of Cinemark Holdings, Inc. filed with the Delaware Secretary of State on April 9, 2007.
  **3 .2   Amended and Restated Bylaws of Cinemark Holdings, Inc. dated April 9, 2007.
  **4 .1   Specimen stock certificate of Cinemark Holdings, Inc.
  4 .2(a)   Indenture, dated as of March 31, 2004, between Cinemark, Inc. and The Bank of New York Trust Company, N.A. governing the 9 3 / 4 % senior discount notes issued thereunder (incorporated by reference to Exhibit 4.2(a) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
  4 .2(b)   Form of 9 3 / 4 % senior discount notes (contained in the indenture listed as Exhibit 4.2(a) above) (incorporated by reference to Exhibit 4.2(b) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
  4 .3(a)   Indenture, dated as of February 11, 2003, between Cinemark USA, Inc. and The Bank of New York Trust Company of Florida, N.A. governing the 9% senior subordinated notes issued thereunder (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K (File 033-47040) filed March 19, 2003).
  4 .3(b)   First Supplemental Indenture, dated as of May 7, 2003, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference from Exhibit 4.2(i) to Cinemark USA, Inc.’s Registration Statement on Form S-4/A (File No. 333-104940) filed May 28, 2003).
  4 .3(c)   Second Supplemental Indenture dated as of November 11, 2004, between Cinemark USA, Inc., the subsidiary guarantors party thereto and The Bank of New York Trust Company of Florida, N.A. (incorporated by reference to Exhibit 4.2(c) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-047040, filed March 28, 2005).
  4 .3(d)   Third Supplemental Indenture, dated as of October 5, 2006, among Cinemark USA, Inc., the subsidiaries of Cinemark USA, Inc. named therein, and The Bank of New York Trust Company, N.A., as trustee (incorporated by reference to Exhibit 10.7 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on October 12, 2006).
  4 .3(e)   Form of 9% Senior Subordinated Note, Due 2013 (contained in the Indenture listed as Exhibit 4.3(a) above) (incorporated by reference to Exhibit 10.2(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K (File 033-47040) filed March 19, 2003).
  4 .4   Stockholders Agreement, dated as of August 7, 2006, effective October 5, 2006, by and among Cinemark Holdings, Inc. and the stockholders party thereto (incorporated by reference to Exhibit 4.4 to Cinemark Holdings, Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).
  4 .5   Registration Agreement, dated as of August 7, 2006, effective October 5, 2006, by and among Cinemark Holdings, Inc. and the stockholders party thereto (incorporated by reference to Exhibit 4.5 to Cinemark Holdings Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).
  *4 .6   Form of Director Nomination Agreement among Cinemark Holdings, Inc. and the stockholders party thereto.


 

         
Number
 
Exhibit Title
 
  *5     Opinion of Akin Gump Strauss Hauer & Feld LLP.
  10 .1(a)   Management Agreement, dated December 10, 1993, between Laredo Theatre, Ltd. and Cinemark USA, Inc. (incorporated by reference to Exhibit 10.14(b) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 31, 1994).
  10 .1(b)   First Amendment to Management Agreement of Laredo Theatre, Ltd., effective as of December 10, 2003, between CNMK Texas Properties, Ltd. (successor in interest to Cinemark USA, Inc.) and Laredo Theatre Ltd. (incorporated by reference to Exhibit 10.1(d) to Cinemark, Inc.’s Registration Statement on Form S-4, File No. 333-116292, filed June 8, 2004).
  10 .2   Amended and Restated Agreement to Participate in Profits and Losses, dated as of March 12, 2004, between Cinemark USA, Inc. and Alan W. Stock (incorporated by reference to Exhibit 10.2 to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  10 .3   License Agreement, dated December 10, 1993, between Laredo Joint Venture and Cinemark USA, Inc. (incorporated by reference to Exhibit 10.14(c) to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 31, 1994).
  10 .4(a)   Tax Sharing Agreement, between Cinemark USA, Inc. and Cinemark International, L.L.C. (f/k/a Cinemark II, Inc.), dated as of June 10, 1992 (incorporated by reference to Exhibit 10.22 to Cinemark USA, Inc.’s Annual Report on Form 10-K, File No. 033-47040, filed March 31, 1993).
  10 .4(b)   Tax Sharing Agreement, dated as of July 28, 1993, between Cinemark USA, Inc. and Cinemark Mexico (USA) (incorporated by reference to Exhibit 10.10 to Cinemark Mexico (USA)’s Registration Statement on Form S-4, File No. 033-72114, filed on November 24, 1993).
  +10 .5(a)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Lee Roy Mitchell (incorporated by reference to Exhibit 10.14(a) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(b)   First Amendment to Employment Agreement, effective as of December 12, 2006, by and between Cinemark, Inc. and Lee Roy Mitchell (incorporated by reference to Exhibit 10.1 to Cinemark, Inc.’s Current Report on Form 8-K, File No. 001-31372, filed December 18, 2006).
  +10 .5(c)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Alan Stock (incorporated by reference to Exhibit 10.14(b) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(d)   First Amendment to Employment Agreement, effective as of December 12, 2006, by and between Cinemark, Inc. and Alan W. Stock (incorporated by reference to Exhibit 10.2 to Cinemark, Inc.’s Current Report on Form 8-K, File No. 001-31372, filed December 18, 2006).
  +10 .5(e)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Tim Warner (incorporated by reference to Exhibit 10.14(c) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(f)   First Amendment to Employment Agreement, effective as of December 12, 2006, by and between Cinemark, Inc. and Timothy Warner (incorporated by reference to Exhibit 10.3 to Cinemark, Inc.’s Current Report on Form 8-K, File No. 001-31372, filed December 18, 2006).
  +10 .5(g)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Robert Copple (incorporated by reference to Exhibit 10.14(d) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(h)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Rob Carmony (incorporated by reference to Exhibit 10.14(e) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(i)   Employment Agreement, dated as of March 12, 2004, between Cinemark, Inc. and Tandy Mitchell (incorporated by reference to Exhibit 10.14(f) to Cinemark USA, Inc.’s Quarterly Report on Form 10-Q, File No. 033-47040, filed May 14, 2004).
  +10 .5(j)   First Amendment to Employment Agreement, dated January 25, 2007, between Cinemark, Inc. and Robert Copple (incorporated by reference to Exhibit 10.5(j) to Cinemark Holdings, Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).


 

         
Number
 
Exhibit Title
 
  10 .6(a)   Credit Agreement, dated as of October 5, 2006, among Cinemark Holdings, Inc., Cinemark, Inc., CNMK Holding, Inc., Cinemark USA, Inc., the several banks and other financial institutions or entities from time to time parties to the Agreement, Lehman Brothers Inc. and Morgan Stanley Senior Funding, Inc., as joint lead arrangers and joint bookrunners, Morgan Stanley Senior Funding, Inc., as syndication agent, BNP Paribas and General Electric Capital Corporation as co-documentation agents, and Lehman Commercial Paper Inc., as administrative agent (incorporated by reference to Exhibit 10.5 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on October 12, 2006).
  **10 .6(b)   First Amendment to Credit Agreement dated as of March 14, 2007 among Cinemark Holdings, Inc., Cinemark, Inc., CNMK Holding, Inc., Cinemark USA, Inc., the several banks and other financial institutions or entities from time to time parties thereto, Lehman Brothers Inc. and Morgan Stanley Senior Funding, Inc., as joint lead arrangers and joint bookrunners, Morgan Stanley Senior Funding, Inc., as syndication agent, BNP Paribas and General Electric Capital Corporation, as co-documentation agents, and Lehman Commercial Paper Inc., as administrative agent.
  10 .6(c)   Guarantee and Collateral Agreement, dated as of October 5, 2006, among Cinemark Holdings, Inc., Cinemark, Inc., CNMK Holding, Inc., Cinemark USA, Inc. and each subsidiary guarantor party thereto (incorporated by reference to Exhibit 10.6 to Current Report on Form 8-K, File No. 000-47040, filed by Cinemark USA, Inc. with the SEC on October 12, 2006).
  **+10 .7(a)   Cinemark Holdings, Inc. 2006 Long Term Incentive Plan, dated December 22, 2006.
  **+10 .7(b)   Form of Stock Option Agreement.
  **#10 .8   Exhibitor Services Agreement, dated as of February 13, 2007, by and between National CineMedia, LLC and Cinemark USA, Inc.
  **10 .9   Third Amended and Restated Limited Liability Company Operating Agreement, dated as of February 12, 2007, by and between Cinemark Media, Inc., American Multi-Cinema, Inc., Regal CineMedia, LLC and National CineMedia, Inc.
  *#10 .10(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .10(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .10(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *10 .10(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .10(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 14, Sacramento, CA.
  *#10 .11(a)   Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *#10 .11(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *10 .11(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *10 .11(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.


 

         
Number
 
Exhibit Title
 
  *#10 .11(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Laguna 16, Elk Grove, CA.
  *#10 .12(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .12(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .12(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *10 .12(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .12(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Capitol 16, San Jose, CA.
  *#10 .13(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *#10 .13(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *10 .13(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *10 .13(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *#10 .13(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 10 Berryessa, San Jose, CA.
  *#10 .14(a)   Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *#10 .14(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *10 .14(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14 at Folsom, CA.
  *10 .14(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *#10 .14(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of December 1, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 14, Folsom, CA.
  *#10 .15(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *#10 .15(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.


 

         
Number
 
Exhibit Title
 
  *10 .15(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *10 .15(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *#10 .15(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Cinedome 12, Henderson, NV.
  *#10 .16(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .16(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .16(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *10 .16(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .16(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Park 12, Redwood City, CA.
  *#10 .17(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *#10 .17(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *10 .17(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *10 .17(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *#10 .17(e)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 8, North Hollywood, CA.
  *#10 .18(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *10 .18(b)   First Amendment, dated as of October 31, 1996, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .18(c)   Second Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .18(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *10 .18(e)   Fourth Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.


 

         
Number
 
Exhibit Title
 
  *#10 .18(f)   Fifth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Plaza 10, S. San Francisco, CA.
  *#10 .19(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .19(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Freemont, CA.
  *#10 .20(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .20(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *10 .20(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .20(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .20(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 7, Newark, CA.
  *#10 .21(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .21(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .21(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *10 .21(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .21(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Cinema 16, Mountain View, CA.
  *#10 .22(a)   Indenture of Lease, dated as of September 30, 1995, by and between Sycal Properties, Inc. (succeeded by Syufy Properties, Inc.), as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .22(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.


 

         
Number
 
Exhibit Title
 
  *10 .22(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .22(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .22(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinearts 5, Pleasant Hill, CA.
  *#10 .23(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *#10 .23(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *10 .23(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *10 .23(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *#10 .23(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 24, San Jose, CA.
  *#10 .24(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .24(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .24(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *10 .24(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .24(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Cinedome 8, Napa, CA.
  *#10 .25(a)   Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *10 .25(b)   First Amendment, dated as of April 15, 2005, to Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *10 .25(c)   Second Amendment, dated as of September 29, 2005, to Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *#10 .25(d)   Third Amendment, dated as of August 5, 2006, to Lease Agreement, dated as of April 10, 1998, by and between Dyer Triangle LLC, as landlord and Century Theatres, Inc., as tenant, for Century 25 Union Landing, Union City, CA.
  *#10 .26(a)   Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *10 .26(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.


 

         
Number
 
Exhibit Title
 
  *10 .26(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *#10 .26(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of March 7, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Sparks, Sparks, NV.
  *#10 .27(a)   Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *10 .27(b)   First Amendment, dated as of April 15, 2005, to Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *10 .27(c)   Second Amendment, dated as of September 29, 2005, to Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *10 .27(d)   Third Amendment, dated as of August 5, 2006, to Lease Agreement, dated as of October 1, 1996, by and between Syufy Enterprises, L.P.(succeeded by Stadium Promenade LLC), as landlord and Century Theatres, Inc., as tenant, for Century Stadium 25, Orange, CA.
  *#10 .28(a)   Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *10 .28(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *10 .28(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *#10 .28(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of July 1, 1996, by and between Synm Properties Inc.(succeeded by Syufy Properties, Inc.), as landlord and Century Theatres, Inc., as tenant, Century Rio 24, Albuquerque, NM.
  *#10 .29(a)   Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *10 .29(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *10 .29(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *#10 .29(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 3, 1996, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century 14, Roseville, CA.
  *#10 .30(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Rancho Santa Fe 16, Las Vegas, NV.
  *#10 .30(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Rancho Santa Fe 16, Las Vegas, NV.
  *#10 .30(c)   Second Amendment, dated as of September 30, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of Nevada, Inc., as tenant, for Rancho Santa Fe 16, Las Vegas, NV.
  *#10 .31(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.


 

         
Number
 
Exhibit Title
 
  *#10 .31(b)   First Amendment, dated as of October 1, 1996, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .31(c)   Second Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *10 .31(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .31(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century Stadium 16, Ventura, CA.
  *#10 .32(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *#10 .32(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *10 .32(c)   Second Amendment, dated as of October 1, 2001, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *#10 .32(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Northridge 14, Salinas, CA.
  *#10 .33(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *10 .33(b)   First Amendment, dated as of January 4, 1998, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *#10 .33(c)   Second Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *10 .33(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *10 .33(e)   Fourth Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P.), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *#10 .33(f)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syut Properties, Inc. (succeeded by Syufy Enterprises, L.P), as landlord and Century Theatres of Utah, Inc., as tenant, for Century 16, Salt Lake City, UT.
  *#10 .34(a)   Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .34(b)   First Amendment, dated as of April 30, 2003, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .34(c)   Second Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *10 .34(d)   Third Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.


 

         
Number
 
Exhibit Title
 
  *#10 .34(e)   Fourth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of April 17, 1998, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Larkspur, Larkspur, CA.
  *#10 .35(a)   Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *10 .35(b)   First Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *10 .35(c)   Second Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *#10 .35(d)   Third Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of August 1, 1997, by and between Syufy Enterprises, L.P., as landlord and Century Theatres, Inc., as tenant, for Century Park Lane 16, Reno, NV.
  *#10 .36(a)   Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *#10 .36(b)   First Amendment, dated as of September 1, 2000, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *10 .36(c)   Second Amendment, dated as of October 1, 2001, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *10 .36(d)   Third Amendment, dated as of April 15, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *10 .36(e)   Fourth Amendment, dated as of September 29, 2005, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  *#10 .36(f)   Fifth Amendment, dated as of August 7, 2006, to Indenture of Lease, dated as of September 30, 1995, by and between Syufy Enterprises, L.P., as landlord and Century Theatres of California, Inc., as tenant, for Century 16, Sacramento, CA.
  10 .37   Stock Purchase Agreement, dated as of August 7, 2006, by and among Cinemark USA, Inc, Cinemark Holdings, Inc., Syufy Enterprises LP, Century Theatres, Inc. and Century Theatres Holdings, LLC (incorporated by reference to Exhibit 10.1 to current Report on Form 8-K, File No, 000-47040, filed by Cinemark USA, Inc. with the SEC on August 11, 2006)
  **21     Subsidiaries of the registrant.
  **23 .1   Consent of Deloitte & Touche LLP.
  **23 .2   Consent of Grant Thornton LLP.
  *23 .3   Consent of Akin Gump Strauss Hauer & Feld LLP (included in the opinion filed as Exhibit 5 to this Registration Statement).
  24     Power of Attorney (included on the signature page of Cinemark Holdings, Inc.’s Registration Statement on Form S-1, File No. 333-140390, filed February 1, 2007).
  **99 .1   Consent of PricewaterhouseCoopers LLP.
  **99 .2   Consent of BIA Financial Network, Inc.
 
 
 * Filed herewith
 ** Previously filed
 # Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.
+ Management contract, compensatory plan or arrangement.

 

Exhibit 1
28,000,000 Shares
CINEMARK HOLDINGS, INC.
Common Stock
FORM OF UNDERWRITING AGREEMENT
April       , 2007
Lehman Brothers Inc.,
Credit Suisse Securities (USA) LLC,
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated,
As Representatives of the several
     Underwriters named in Schedule 1 attached hereto,
c/o Lehman Brothers Inc.
745 Seventh Avenue
New York, New York 10019
c/o Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York, New York 10010-3629
c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
North Tower
World Financial Center
New York, New York 10281
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
          Cinemark Holdings, Inc., a Delaware corporation (the “ Company ”), and certain stockholders of the Company named in Schedule 2 attached hereto (the “ Selling Stockholders ”) propose to sell an aggregate of 28,000,000 shares (the “Firm Stock" ) of the Company’s common stock, par value $0.001 per share (the “ Common Stock ”). Of the 28,000,000 shares of the Firm Stock, 13,888,889 shares are being sold by the Company and 14,111,111 shares by the Selling Stockholders. In addition, the Selling Stockholders propose to grant to the underwriters (the “ Underwriters ”) named in Schedule 1 attached to this Agreement (this “ Agreement ”) an option to purchase up to an aggregate of 2,800,000 additional shares of the Common Stock on the terms set forth in Section 3 (the “ Option Stock ”). The Firm Stock and the Option Stock, if purchased, are hereinafter collectively called the “ Stock .” This is to confirm the agreement concerning the purchase of the Stock from the Company and the Selling Stockholders by the


 

2

Underwriters. Lehman Brothers Inc., Credit Suisse Securities (USA) LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley & Co. Incorporated shall act as representatives (the “ Representatives ”) of the Underwriters.
     SECTION 1. Representations, Warranties and Agreements of the Company . The Company represents, warrants and agrees that:
          (a) A registration statement on Form S-1 relating to the Stock has (i) been prepared by the Company in conformity in all material respects with the requirements of the Securities Act of 1933, as amended (the “ Securities Act ”), and the rules and regulations (the “ Rules and Regulations ”) of the Securities and Exchange Commission (the “ Commission ”) thereunder; (ii) been filed with the Commission under the Securities Act; and (iii) become effective under the Securities Act. Copies of such registration statement and any amendment thereto have been made available by the Company to you. As used in this Agreement:
     (i) “ Applicable Time ” means ___[a.m.][p.m.] (New York City time) on the date of this Agreement;
     (ii) “ Effective Date ” means the date and time as of which such registration statement, or the most recent post-effective amendment thereto, if any, was declared effective by the Commission;
     (iii) “ Issuer Free Writing Prospectus ” means each “free writing prospectus” (as defined in Rule 405 of the Rules and Regulations) prepared by or on behalf of the Company or used or referred to by the Company in connection with the offering of the Stock;
     (iv) “ Preliminary Prospectus ” means any preliminary prospectus relating to the Stock included in such registration statement or filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations;
     (v) “ Pricing Disclosure Package ” means, as of the Applicable Time, the most recent Preliminary Prospectus, together with each Issuer Free Writing Prospectus filed or used by the Company on or before the Applicable Time (which Issuer Free Writing Prospectuses are identified on Schedule 3 attached hereto), other than a road show that is an Issuer Free Writing Prospectus but is not required to be filed under Rule 433 of the Rules and Regulations;
     (vi) “ Prospectus ” means the final prospectus relating to the Stock, as filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations; and
     (vii) “ Registration Statement ” means such registration statement, as amended as of the Effective Date, including any Preliminary Prospectus or the Prospectus and all exhibits to such registration statement.
Any reference herein to the “ most recent Preliminary Prospectus ” shall be deemed to refer to the latest Preliminary Prospectus included in the Registration Statement or filed pursuant to Rule


 

3

424(b) prior to or on the date hereof. [ Any reference herein to the term “Registration Statement” shall be deemed to include the abbreviated registration statement to register additional shares of Common Stock under Rule 462(b) of the Rules and Regulations (the “ Rule 462(b) Registration Statement ”). ] The Commission has not issued any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus or suspending the effectiveness of the Registration Statement, and no proceeding or examination for such purpose has been instituted or, to the Company’s knowledge, threatened by the Commission.
          (b) The Company was not at the time of filing of the Registration Statement an “ineligible issuer” in accordance with Rule 405 and Rule 164(h)(2) of the Rules and Regulations.
          (c) The Registration Statement conformed on the Effective Date, and on the date hereof conforms, in all material respects, and any amendment to the Registration Statement filed after the date hereof will conform in all material respects when filed, to the requirements of the Securities Act and the Rules and Regulations. The most recent Preliminary Prospectus conformed, and the Prospectus will conform, in all material respects when filed with the Commission pursuant to Rule 424(b) and on the applicable Delivery Date to the requirements of the Securities Act and the Rules and Regulations.
          (d) The Registration Statement did not, as of the Effective Date, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Registration Statement in reliance upon and in conformity with written information furnished to the Company through the Representatives by or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 10(f).
          (e) The Prospectus will not, as of its date and on the applicable Delivery Date, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Prospectus in reliance upon and in conformity with written information furnished to the Company through the Representatives by or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 10(f).
          (f) The Pricing Disclosure Package (together with the information included on Schedule 4 attached hereto) did not, as of the Applicable Time, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Pricing Disclosure Package in reliance upon and in conformity with written information furnished to the Company through the Representatives by or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 10(f).
          (g) Each Issuer Free Writing Prospectus (including, without limitation, any road show that is a free writing prospectus under Rule 433), when considered together with the Pricing Disclosure Package (together with the information included on Schedule 4 hereto), did


 

4

not, as of the Applicable Time, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Pricing Disclosure Package in reliance upon and in conformity with written information furnished to the Company through the Representatives by or on behalf of any Underwriter specifically for inclusion therein, which information is specified in Section 10(f).
          (h) Each Issuer Free Writing Prospectus conformed or will conform in all material respects to the requirements of the Securities Act and the Rules and Regulations on the date of first use, and the Company has complied with all prospectus delivery and any filing requirements applicable to such Issuer Free Writing Prospectus pursuant to the Rules and Regulations. The Company has not made any offer relating to the Stock that would constitute an Issuer Free Writing Prospectus, other than as listed on Schedule 3 hereto, without the prior written consent of the Representatives. The Company has retained in accordance with the Rules and Regulations all Issuer Free Writing Prospectuses that were not required to be filed pursuant to the Rules and Regulations. The Company has taken all actions necessary under Rule 433(d)(8) of the Rules and Regulations so that any “road show” (as defined in Rule 433) in connection with the offering of the Stock will not be required to be filed pursuant to the Rules and Regulations.
          (i) The Company and each of its subsidiaries (as defined in Section 19) have been duly organized and are validly existing as corporations or other business organizations, as applicable, in good standing under the laws of their respective jurisdictions of incorporation or organization, as applicable, are duly qualified to do business and are in good standing as foreign corporations or other business organizations, as applicable, in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and have all power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged, except where the failure to be so qualified or in good standing would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the condition (financial or otherwise), properties, business or prospects of the Company and its subsidiaries taken as a whole (a “ Material Adverse Effect ”). None of the subsidiaries of the Company (other than Cinemark, Inc., CNMK Holdings, Inc., Cinemark USA, Inc., CNMK Investments, Inc., CNMK Texas Properties, Ltd., Cinemark Partners II, Ltd., Cinemark de Mexico, S.A. Cinemark Media, Inc. and Cinemark Brasil, S.A. (collectively, the " Significant Subsidiaries ”)) is a “significant subsidiary” (as defined in Rule 405 of the Rules and Regulations).
          (j) The Company has an authorized capitalization as of December 31, 2006 as set forth under the “Actual” column in the “Capitalization” section of each of the most recent Preliminary Prospectus and the Prospectus, and all of the issued shares of capital stock of the Company have been duly authorized and validly issued, are fully paid and non-assessable, conform in all material respects to the description thereof contained in the most recent Preliminary Prospectus and were issued in compliance with federal and state securities laws and not in violation of any preemptive right, resale right, right of first refusal or similar right. All of the Company’s options, warrants and other rights to purchase or exchange any securities for


 

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shares of the Company’s capital stock have been duly authorized and validly issued, conform in all material respects to the description thereof contained in the most recent Preliminary Prospectus and were issued in compliance with federal and state securities laws. All of the issued shares of capital stock or membership interests, as applicable, of each subsidiary of the Company have been duly authorized, validly issued and are fully paid and non-assessable and, except as described in the most recent Preliminary Prospectus and for directors’ qualifying shares for foreign subsidiaries, are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims, other than the liens and encumbrances imposed thereon pursuant to the Credit Agreement, dated as of October 5, 2006, among the Company, Cinemark, Inc., CNMK Holdings, Inc., Cinemark USA, Inc. and the banks, financial institutions and other parties signatory thereto, as amended by the First Amendment thereto, dated as of March 14, 2007 (which are described in the most recent Preliminary Prospectus) and any liens, encumbrances, equities or claims as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
          (k) The shares of the Stock to be issued and sold by the Company to the Underwriters hereunder have been duly authorized and, when issued and delivered against payment therefor in accordance with this Agreement, will be validly issued, fully paid and non-assessable; the Stock will conform to the descriptions thereof contained in the most recent Preliminary Prospectus, will be issued in compliance with federal and state securities laws and will be free of statutory and contractual preemptive rights, rights of first refusal and similar rights.
          (l) The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. This Agreement has been duly authorized, executed and delivered by the Company.
          (m) The execution, delivery and performance by the Company of this Agreement, the consummation of the transactions contemplated hereby and the application of the proceeds from the sale of the Stock as described under “Use of Proceeds” in the most recent Preliminary Prospectus do not and will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, lease, pledge or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, (ii) result in any violation of the provisions of the charter or bylaws of the Company or the charter or bylaws or any joint venture, partnership, limited liability company, shareholders’ or other agreement or organizational document of any of the Company’s subsidiaries, or (iii) result in any violation of any statute or any order, rule or regulation of any court or governmental agency or body (whether domestic or foreign) having jurisdiction over the Company or any of its subsidiaries or any of their properties or assets except in the case of clauses (i) and (iii), such conflicts, breaches or violations that in the aggregate would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or impair the ability of the Company to perform its obligations under this Agreement; and, except for the registration of the Stock under the Securities Act and such consents, approvals, authorizations, registrations or qualifications as may be required under the Securities Exchange Act of 1934, as amended (the " Exchange Act ”) by the National Association of Securities Dealers, Inc. (“ NASD ”) and under


 

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applicable state or foreign securities laws in connection with the purchase and distribution of the Stock by the Underwriters, no consent, approval, authorization or order of, or filing or registration with, any such court or governmental agency or body (whether domestic or foreign) is required for the execution, delivery and performance of this Agreement, the consummation by the Company of the transactions contemplated hereby and the application of the proceeds from the sale of the Stock as described under “Use of Proceeds” in the most recent Preliminary Prospectus.
          (n) Except as described in the most recent Preliminary Prospectus, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant to the Registration Statement or in any securities being registered pursuant to any other registration statement filed by the Company under the Securities Act.
          (o) Except as described in the most recent Preliminary Prospectus, the Company has not sold or issued any shares of Common Stock during the six-month period preceding the date of the Prospectus, including any sales pursuant to Rule 144A under, or Regulations D or S of, the Securities Act other than shares issued pursuant to employee benefit plans, qualified stock options plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.
          (p) Neither the Company nor any of its subsidiaries has sustained, since the date of the latest audited financial statements included in the most recent Preliminary Prospectus, any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree (whether domestic or foreign) otherwise than as set forth or contemplated in the most recent Preliminary Prospectus except where such losses or interferences would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; and, since such date, there has not been any change in the capital stock (other than shares issued pursuant to employee benefit plans, qualified stock options plans or other employee compensation plans or pursuant to outstanding options, rights or warrants, in each case as such plans, options rights or warrants are described in each of the most recent Preliminary Prospectus and the Prospectus) or increase in the long-term debt of the Company or any of its subsidiaries or any adverse change, or any development involving a prospective adverse change, that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, otherwise than as set forth or contemplated in the most recent Preliminary Prospectus.
          (q) Since the date as of which information is given in the most recent Preliminary Prospectus, and except as otherwise disclosed in the most recent Preliminary Prospectus, the Company has not (i) issued or granted any securities, (ii) incurred any material liability or obligation, direct or contingent, other than liabilities and obligations which were incurred in the ordinary course of business, (iii) entered into any material transaction not in the ordinary course of business or (iv) declared or paid any dividend on its capital stock.


 

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          (r) The historical financial statements (including the related notes and supporting schedules) included in the most recent Preliminary Prospectus comply as to form in all material respects with the requirements of Regulation S-X under the Securities Act and present fairly in all material respects the financial position, results of operations and cash flows of the entities purported to be shown thereby at the dates and for the periods indicated, and have been prepared in conformity with generally accepted accounting principles in the United States applied on a consistent basis throughout the periods involved. The assumptions used in the preparation of the pro forma financial statements included in the most recent Preliminary Prospectus provide a reasonable basis for presenting the significant effects directly attributable to the transactions and events described therein, the related pro forma adjustments give appropriate effect to those assumptions, and the pro forma columns reflect the proper application of those adjustments to the historical financial statement amounts in such pro forma financial statements. The pro forma financial information included in the most recent Preliminary Prospectus comply as to form in all material respects with the applicable requirements of Regulation S-X under the Act.
          (s) Deloitte & Touche LLP, who have certified certain financial statements of the Company, whose report appears in the most recent Preliminary Prospectus and who have delivered the initial letter referred to in Section 9(h)(i) hereof, are independent public accountants as required by the Securities Act and the Rules and Regulations. Grant Thornton LLP, who have certified certain financial statements of Century Theatres, Inc., whose report appears in the most recent Preliminary Prospectus and who have delivered the initial letter referred to in Section 9(h)(i) hereof, are independent public accountants as required by the Securities Act and the Rules and Regulations.
          (t) The Company and each of its subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them, in each case free and clear of all liens, encumbrances and defects, except such as are described in the most recent Preliminary Prospectus or such as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; and, except as described in the most recent Preliminary Prospectus, all assets held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases, except such as are described in the most recent Preliminary Prospectus or such as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
          (u) The Company and each of its subsidiaries carry, or are covered by, insurance in such amounts and covering such risks which the Company believes are adequate for the conduct of their respective businesses and the value of their respective properties.
          (v) The Company and each of its subsidiaries own or possess adequate rights to use all material patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights and licenses necessary for the conduct of their respective businesses and have no reason to believe that the conduct of their respective businesses will conflict with, and have not received any notice of any claim of conflict with, any such rights of others that, if determined adversely to the Company or any of its subsidiaries would reasonably be likely to have, individually or in the aggregate, a Material Adverse Effect.


 

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          (w) Except as described in the most recent Preliminary Prospectus, there are no legal or governmental proceedings (whether domestic or foreign) pending to which the Company or any of its subsidiaries is a party or of which any property or assets of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; and to the best of the Company’s knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others.
          (x) There are no contracts or other documents which are required to be described in the Registration Statement or the most recent Preliminary Prospectus or filed as exhibits to the Registration Statement by the Securities Act or by the Rules and Regulations that are not described or filed as required.
          (y) No relationship, direct or indirect, exists between or among the Company on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company on the other hand, which is required to be described in the most recent Preliminary Prospectus which is not so described.
          (z) No labor disturbance by the employees of the Company exists or, to the knowledge of the Company, is imminent, which would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
          (aa) The Company and members of its controlled group within the meaning of Sections 414 of the Internal Revenue Code of 1986, as amended, including the regulations and published interpretations thereunder (the “ Code ”) are in compliance in all respects with all presently applicable provisions of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder (“ ERISA ”), except where the failure to be in such compliance would not reasonably be likely to have, individually or in the aggregate, a Material Adverse Effect; no “ reportable event ” (as defined in ERISA) has occurred and is continuing with respect to any “ pension plan ” (as defined in ERISA) for which the Company and such members would have any liability; except for matters that would not reasonably be likely to have, individually or in the aggregate, a Material Adverse Effect; the Company and such members have not incurred and do not expect to incur liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “ pension plan ” or (ii) Sections 412 or 4971 of the Code, and each “ pension plan ” for which the Company and such members would have any liability that is intended to be qualified under Section 401(a) of the Code is so qualified in all material respects and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification.
          (bb) The Company and each of its subsidiaries have filed (or obtained extensions to file) all federal, state, local and foreign income and franchise tax returns required to be filed through the date hereof, except where the failure to so file would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, and have paid all taxes due thereon, other than those (i) currently payable without penalty or interest or (ii) being contested in good faith and by appropriate proceedings and for which, in the case of both (i) and (ii), adequate reserves have been established on the books and records of the Company in accordance with generally accepted accounting principles in the United States. No tax deficiency has been


 

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determined adversely to the Company or any of its subsidiaries which has had (nor does the Company have any knowledge of any tax deficiency which, if determined adversely to the Company or any of its subsidiaries) or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
          (cc) Neither the Company nor any of its subsidiaries (i) is in violation of (A), in the case of the Company, its charter or bylaws or (B) in the case of any of the Company’s subsidiaries, its charter or bylaws or any of its joint venture, partnership, limited liability company, shareholders’ or other agreement or organizational document as the case may be, (ii) is in default in any respect, and no event has occurred which, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, lease, pledge or other agreement or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject or (iii) is in violation in any respect of any law, ordinance, governmental rule, regulation or court decree (whether domestic or foreign) to which it or its property or assets may be subject or has failed to obtain any material license, permit, certificate, franchise or other governmental authorization or permit (whether domestic or foreign) necessary to the ownership of its property or to the conduct of its business, except in the case of clauses (ii) and (iii), such defaults, events, violations or failures that would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
          (dd) The Company and each of its subsidiaries (i) make and keep accurate books and records and (ii) maintain and has maintained effective internal control over financial reporting as defined in Rule 13a-15 under the Exchange Act and a system of internal accounting controls sufficient to provide reasonable assurance that (A) transactions are executed in accordance with management’s general or specific authorization, (B) transactions are recorded as necessary to permit preparation of the Company’s financial statements in conformity with accounting principles generally accepted in the United States and to maintain accountability for its assets, (C) access to the Company’s assets is permitted only in accordance with management’s general or specific authorization and (D) the recorded accountability for the Company’s assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
          (ee) (i) The Company has established and maintain disclosure controls and procedures (as such term is defined in Rule 13a-15 under the Exchange Act), (ii) such disclosure controls and procedures are designed to ensure that the information required to be disclosed by the Company in the reports they will file or submit under the Exchange Act is accumulated and communicated to management of the Company, including their respective principal executive officers and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure to be made and (iii) such disclosure controls and procedures are effective in all material respects to perform the functions for which they were established.
          (ff) There is and has been no failure on the part of the Company and any of the Company’s directors or officers, in their capacities as such, to comply with the provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith.


 

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          (gg) Neither the Company nor any of its subsidiaries, nor to the best of the Company’s knowledge, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of its subsidiaries, has used any corporate or organizational funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.
          (hh) The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “ Money Laundering Laws ”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened, except, in each case, as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
          (ii) Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“ OFAC ”); and the Company will not directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.
          (jj) There has been no storage, disposal, generation, manufacture, refinement, transportation, handling or treatment of toxic wastes, medical wastes, hazardous wastes or hazardous substances by the Company or any of its subsidiaries (or, to the knowledge of the Company, any of their predecessors in interest) at, upon or from any of the property now or previously owned or leased by the Company or its subsidiaries in violation of any applicable law, ordinance, rule, regulation, order, judgment, decree or permit or which would require remedial action under any applicable law, ordinance, rule, regulation, order, judgment, decree or permit, except for any violation or remedial action which would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; there has been no material spill, discharge, leak, emission, injection, escape, dumping or release of any kind onto such property or into the environment surrounding such property of any toxic wastes, medical wastes, solid wastes, hazardous wastes or hazardous substances due to or caused by the Company or any of its subsidiaries or with respect to which the Company or any of its subsidiaries have knowledge, except for any such spill, discharge, leak, emission, injection, escape, dumping or release which would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; and the terms “ hazardous wastes ”, “ toxic wastes ”, “ hazardous substances ” and “ medical wastes ” shall have the meanings specified in any applicable local, state, federal and foreign laws or regulations with respect to environmental protection.


 

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          (kk) The Company is not and, as of each Delivery Date after giving effect to the issuance and sale of the Stock and the application of the net proceeds therefrom as described in the most recent Preliminary Prospectus, will not be, an “ investment company ” as defined in the Investment Company Act of 1940, as amended.
          (ll) The industry, statistical and market-related data included in each of the most recent Preliminary Prospectus and the Prospectus are derived from sources that the Company reasonably and in good faith believes to be accurate, reasonable and reliable, and such data agrees with the sources from which they were derived.
          (mm) The Company has not taken, directly or indirectly, any action designed to cause or result in, or which has constituted or which might reasonably be expected to constitute, the stabilization or manipulation of the price of any security of the Company in connection with this transaction.
          (nn) The Company has not distributed and, prior to the later to occur of any Delivery Date and completion of the distribution of the Stock, will not distribute any offering material in connection with the offering and sale of the Stock other than any Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus to which the Representatives have consented in accordance with Section 1(h) or 6(a)(vi).
          (oo) The Stock has been approved for listing, subject to official notice of issuance and evidence of satisfactory distribution, on the New York Stock Exchange.
          Any certificate signed by any officer of the Company and delivered to the Representatives or counsel for the Underwriters in connection with the offering of the Stock shall be deemed a representation and warranty by the Company, as to matters covered thereby, to each Underwriter.
     SECTION 2. Representations, Warranties and Agreements of the Selling Stockholders . Each Selling Stockholder, severally and not jointly, represents, warrants and agrees that:
          (a) Neither such Selling Stockholder nor any person acting on behalf of such Selling Stockholder (other than, if applicable, the Company and the Underwriters) has used, prior to the completion of the Underwriters’ distribution of the Stock, any “free writing prospectus” (as defined in Rule 405), relating to the Stock.
          (b) Such Selling Stockholder has, and immediately prior to any Delivery Date such Selling Stockholder will have, good and valid title to or a valid “security entitlement” within the meaning of Section 8-501 of the New York Uniform Commercial Code (the “ UCC ”) in respect of, the shares of Stock to be sold by such Selling Stockholder hereunder on such Delivery Date, free and clear of all liens, encumbrances, equities or claims. Upon payment for the Stock to be sold by such Selling Stockholder, delivery of such Stock, as directed by the Underwriters, to Cede & Co. (“ Cede ”) or such other nominee as may be designated by The Depository Trust Company (“ DTC ”), registration of such Stock in the name of Cede or such other nominee and the crediting of such Stock on the books of DTC to securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter has notice of any adverse


 

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claim (within the meaning of Section 8-105 of the UCC) to such Stock), (i) under Section 8-501 of the UCC, the Underwriters will acquire a valid security entitlement in respect of such Stock and (ii) no action based on any valid “adverse claim,” within the meaning of Section 8-102 of the UCC, to such Stock may be asserted against the Underwriters with respect to such security entitlement. For purposes of this representation, such Selling Stockholder may assume that when such payment, delivery and crediting occur, (A) such Shares will have been registered in the name of Cede or another nominee designated by DTC, in each case on the Company’s share registry in accordance with its certificate of incorporation, bylaws and applicable law, (B) DTC will be registered as a “clearing corporation” within the meaning of Section 8-102 of the UCC and (C) appropriate entries to the accounts of the several Underwriters on the records of DTC will have been made pursuant to the UCC.
          (c) Such Selling Stockholder has full right, power and authority, corporate or otherwise, to enter into this Agreement.
          (d) This Agreement has been duly and validly authorized, executed and delivered by or on behalf of such Selling Stockholder.
          (e) The execution, delivery and performance of this Agreement by such Selling Stockholder and the consummation by such Selling Stockholder of the transactions contemplated hereby and thereby do not and will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement, lease, pledge or other agreement or instrument to which such Selling Stockholder is a party or by which such Selling Stockholder is bound or to which any of the property or assets of such Selling Stockholder is subject which conflict, breach, violation or default would impair the ability of such Selling Stockholder to perform its obligations under this Agreement, (ii) result in any violation of the provisions of any partnership or limited liability company agreement, certificate of incorporation, bylaws, operating agreement, deed of trust or other similar agreement or organizational document of such Selling Stockholder or (iii) result in any material violation of any statute or any order, rule or regulation of any court or governmental agency or body (whether domestic or foreign) having jurisdiction over such Selling Stockholder or the property or assets of such Selling Stockholder which violation would impair the ability of such Selling Stockholder to perform its obligations under this Agreement; and, except for the registration of the Stock under the Securities Act, approval by the NASD and under such consents, approvals, authorizations, registrations or qualifications as may be required under the Exchange Act and applicable state or foreign securities laws in connection with the purchase and distribution of the Stock by the Underwriters, no material consent, approval, authorization or order of, or filing or registration with, any such court or governmental agency or body is required for the execution, delivery and performance of this Agreement by such Selling Stockholder and the consummation by such Selling Stockholder of the transactions contemplated hereby.
          (f) The Registration Statement did not as of the Effective Date, the Prospectus will not as of its date and on the applicable Delivery Date, the Pricing Disclosure Package (together with the information included on Schedule 4 attached hereto) did


 

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not as of the Applicable Time, and each Issuer Free Writing Prospectus (including, without limitation, any road show that is a free writing prospectus under Rule 433), when considered together with the Pricing Disclosure Package (together with the information included on Schedule 4 hereto), did not as of the Applicable Time, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the foregoing representation and warranty shall apply only to the extent that any statements in or omissions from the Registration Statement, the Prospectus, the Pricing Disclosure Package or any Issuer Free Writing Prospectus, as applicable, are made in reliance upon and in conformity with written information concerning such Selling Stockholder furnished to the Company by such Selling Stockholder specifically for inclusion therein.
          (g) Such Selling Stockholder is not prompted to sell shares of Common Stock by any material negative information concerning the Company that is not set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
          (h) Such Selling Stockholder has not taken and will not take, directly or indirectly, any action that is designed to or which has constituted or that could reasonably be expected to cause or result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the shares of the Stock.
          Any certificate signed by any officer of any Selling Stockholder and delivered to the Representatives or counsel for the Underwriters in connection with the offering of the Stock shall be deemed a representation and warranty by such Selling Stockholder, as to matters covered thereby, to each Underwriter.
     SECTION 3. Purchase of the Stock by the Underwriters . On the basis of the representations and warranties contained in, and subject to the terms and conditions of, this Agreement, the Company agrees to sell 28,000,000 shares of the Firm Stock and each Selling Stockholder agrees to sell the number of shares of the Firm Stock set forth opposite its name in Schedule 2 hereto, severally and not jointly, to the several Underwriters and each of the Underwriters, severally and not jointly, agrees to purchase the number of shares of the Firm Stock set forth opposite that Underwriter’s name in Schedule 1 hereto. Each Underwriter shall be obligated to purchase from the Company, and from each Selling Stockholder, that number of shares of the Firm Stock that represents the same proportion of the number of shares of the Firm Stock to be sold by the Company and by each Selling Stockholder as the number of shares of the Firm Stock set forth opposite the name of such Underwriter in Schedule 1 hereto represents of the total number of shares of the Firm Stock to be purchased by all of the Underwriters pursuant to this Agreement. The respective purchase obligations of the Underwriters with respect to the Firm Stock shall be rounded among the Underwriters to avoid fractional shares, as the Representatives may determine.
          In addition, each Selling Stockholder grants to the Underwriters an option to purchase up to the number of shares of Option Stock set forth opposite such Selling Stockholder’s name in Schedule 2 hereto, severally and not jointly. Such option is exercisable in the event that the Underwriters sell more shares of Common Stock than the number of Firm Stock in the offering and as set forth in Section 5 hereof. Any such election to purchase Option Stock shall be made in proportion to the maximum number of shares of Option Stock to be sold by each Selling Stockholder as set forth in Schedule 2 hereto. Each Underwriter agrees, severally and not jointly, to purchase the number of shares of Option Stock (subject to such


 

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adjustments to eliminate fractional shares as the Representatives may determine) that bears the same proportion to the total number of shares of Option Stock to be sold on such Delivery Date as the number of shares of Firm Stock set forth in Schedule 1 hereto opposite the name of such Underwriter bears to the total number of shares of Firm Stock.
          The price of both the Firm Stock and any Option Stock purchased by the Underwriters shall be $  per share.
          The Company and the Selling Stockholders shall not be obligated to deliver any of the Firm Stock or Option Stock to be delivered on the applicable Delivery Date, except upon payment for all such Stock to be purchased on such Delivery Date as provided herein.
     SECTION 4. Offering of Stock by the Underwriters.
          Upon authorization by the Representatives of the release of the Firm Stock, the several Underwriters propose to offer the Firm Stock for sale upon the terms and conditions to be set forth in the Prospectus.
     SECTION 5. Delivery of and Payment for the Stock . Delivery of and payment for the Firm Stock by the Company and the Selling Stockholders shall be made at the office of Simpson Thacher & Bartlett, 425 Lexington Avenue, New York, New York at 10:00 A.M., New York City time, on the third full business day following the date of this Agreement or at such other date or place as shall be determined by agreement between the Representatives and the Company. This date and time are sometimes referred to as the “ Initial Delivery Date .” Delivery of the Firm Stock shall be made to the Representatives for the account of each Underwriter against payment by the several Underwriters through the Representatives and of the respective aggregate purchase prices of the Firm Stock being sold by the Company and the Selling Stockholders to or upon the order of the Company and the Selling Stockholders of the purchase price by wire transfer in immediately available funds to the accounts specified by the Company and the Selling Stockholders. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. The Company and the Selling Stockholders shall deliver the Firm Stock through the facilities of DTC unless the Representatives shall otherwise instruct.
          The option granted in Section 3 will expire 30 days after the date of this Agreement and may be exercised in whole or from time to time in part by written notice being given to the Company and the Selling Stockholders by the Representatives; provided that if such date falls on a day that is not a business day, the option granted in Section 3 will expire on the next succeeding business day. Such notice shall set forth the aggregate number of shares of Option Stock as to which the option is being exercised, the names in which the shares of Option Stock are to be registered, the denominations in which the shares of Option Stock are to be issued and the date and time, as determined by the Representatives, when the shares of Option Stock are to be delivered; provided , however , that this date and time shall not be earlier than the Initial Delivery Date nor earlier than the second business day after the date on which the option shall have been exercised nor later than the fifth business day after the date on which the option shall have been exercised. Each date and time the shares of Option Stock are delivered is


 

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sometimes referred to as an “ Option Stock Delivery Date ,” and the Initial Delivery Date and any Option Stock Delivery Date are sometimes each referred to as a “ Delivery Date .”
          Delivery of the Option Stock by the Selling Stockholders and payment for the Option Stock by the several Underwriters through the Representatives shall be made at 10:00 A.M., New York City time, on the date specified in the corresponding notice described in the preceding paragraph or at such other date or place as shall be determined by agreement among the Representatives, the Company and the Selling Stockholders. On the Option Stock Delivery Date, the Selling Stockholders shall deliver or cause to be delivered the Option Stock to the Representatives for the account of each Underwriter against payment by the several Underwriters through the Representatives of the respective aggregate purchase prices of the Option Stock being sold by the Selling Stockholders to or upon the order of the Selling Stockholders of the purchase price by wire transfer in immediately available funds to the accounts specified by the Selling Stockholders. Time shall be of the essence, and delivery at the time and place specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. The Company and the Selling Stockholders shall deliver the Option Stock through the facilities of DTC unless the Representatives shall otherwise instruct.
     SECTION 6. Further Agreements of the Company and the Underwriters . (a) The Company agrees:
(i) To prepare the Prospectus in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Securities Act not later than the Commission’s close of business on the second business day following the execution and delivery of this Agreement; to make no further amendment or any supplement to the Registration Statement or the Prospectus prior to the last Delivery Date except as provided herein; to advise the Representatives, promptly after it receives notice thereof, of the time when any amendment or supplement to the Registration Statement or the Prospectus has been filed and to make available to the Representatives and the Selling Stockholders copies thereof; to advise the Representatives, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of the Prospectus or any Issuer Free Writing Prospectus, of the suspension of the qualification of the Stock for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding or examination for any such purpose or of any request by the Commission for the amending or supplementing of the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of the Prospectus or any Issuer Free Writing Prospectus or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal;
(ii) To furnish promptly to the Representatives, to counsel for the Underwriters and to the Stockholders conformed copies of the Registration Statement as originally filed with the Commission, and each amendment thereto filed with the Commission, including all consents and exhibits filed therewith;


 

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(iii) To deliver promptly to the Representatives such number of the following documents as the Representatives shall reasonably request, and to the Selling Stockholders such number of the following documents as the Selling Stockholders shall reasonably request: (A) conformed copies of the Registration Statement as originally filed with the Commission and each amendment thereto (in each case excluding exhibits), (B) each Preliminary Prospectus, the Prospectus and any amended or supplemented Prospectus and (C) each Issuer Free Writing Prospectus; and, if the delivery of a prospectus is required at any time after the date hereof in connection with the offering or sale of the Stock or any other securities relating thereto and if at such time any events shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary to amend or supplement the Prospectus in order to comply with the Securities Act, to notify the Representatives and, upon their request, to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request, and to the Selling Stockholders as many copies as they may from time to time reasonably request, of an amended or supplemented Prospectus that will correct such statement or omission or effect such compliance;
(iv) To file promptly with the Commission any amendment or supplement to the Registration Statement or the Prospectus that may, in the judgment of the Company or the Representatives, be required by the Securities Act or requested by the Commission;
(v) Prior to filing with the Commission any amendment or supplement to the Registration Statement or the Prospectus, to furnish copies thereof to the Representatives and counsel for the Underwriters and obtain the consent of the Representatives to the filing, and to furnish copies thereof to the Selling Stockholders;
(vi) Not to make any offer relating to the Stock that would constitute an Issuer Free Writing Prospectus, other than as listed on Schedule 3, without the prior written consent of the Representatives.
(vii) To comply with all applicable requirements of Rule 433 with respect to any Issuer Free Writing Prospectus; and if at any time after the date hereof any events shall have occurred as a result of which any Issuer Free Writing Prospectus, as then amended or supplemented, would conflict with the information in the Registration Statement, the most recent Preliminary Prospectus or the Prospectus or would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or, if for any other reason it shall be necessary to amend or supplement any Issuer Free Writing Prospectus, to notify the Representatives and, upon their request, to file such document and to prepare and furnish without charge to each Underwriter as many copies as the Representatives may from time to time reasonably request, and to the Selling Stockholders as many copies as they may from time to time reasonably request,


 

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of an amended or supplemented Issuer Free Writing Prospectus that will correct such conflict, statement or omission or effect such compliance;
(viii) As soon as practicable after the Effective Date (it being understood that the Company shall have until at least 410 days or, if the fourth quarter following the fiscal quarter that includes the Effective Date is the last fiscal quarter of the Company’s fiscal year, 455 days after the end of the Company’s current fiscal quarter), to make generally available to the Company’s security holders and to deliver to the Representatives and the Selling Stockholders an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Securities Act and the Rules and Regulations (including, at the option of the Company, Rule 158);
(ix) Promptly from time to time to take such action as the Representatives may reasonably request to qualify the Stock for offering and sale under the securities laws of Canada and such other jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Stock; provided that in connection therewith the Company shall not be required to (A) qualify as a foreign corporation in any jurisdiction in which it would not otherwise be required to so qualify, (B) file a general consent to service of process in any such jurisdiction or (C) subject itself to taxation in any jurisdiction in which it would not otherwise be subject;
(x) For a period commencing on the date hereof and ending on the 180th day after the date of the Prospectus (the “ Lock-Up Period ”), not to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at any time in the future of) any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than the Stock and shares issued pursuant to employee benefit plans, qualified stock option plans, stock purchase plans or other employee compensation plans existing on the date hereof or pursuant to currently outstanding options not issued under one of those plans), or sell or grant options, rights or warrants with respect to any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than the grant of options, rights, warrants or convertible securities pursuant to plans existing on the date hereof), or (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of ownership of such shares of Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or other securities, in cash or otherwise, (3) file or cause to be filed a registration statement, including any amendments, with respect to the registration of any shares of Common Stock or securities convertible, exercisable or exchangeable into Common Stock or any other securities of the Company (other than any registration statements on Form S-8 or amendments thereto) or (4) publicly disclose the intention to do any of the foregoing, in each case without the prior written consent of Lehman Brothers Inc. on behalf of the Underwriters; and to cause each officer, director and stockholder of the Company set forth on Schedule 5 attached hereto to furnish to Lehman Brothers Inc., prior to the Initial Delivery Date, a letter or letters, substantially in the form of Exhibit A hereto (the “ Lock-Up Agreements ”); notwithstanding the foregoing, if (i) during the last 17 days of the


 

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Lock-Up Period, the Company issues an earnings release or material news or a material event relating to the Company occurs or (ii) prior to the expiration of the Lock-Up Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Lock-Up Period, then the restrictions imposed in this paragraph shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or the occurrence of the material event, unless Lehman Brothers Inc., on behalf of the Underwriters, waives such extension in writing;
(xi) To apply the net proceeds from the sale of the Stock being sold by the Company as set forth in the Prospectus; and
(xii) To take such steps as shall be necessary to ensure that neither the Company nor any subsidiary shall become an “ investment company ” as defined in the Investment Company Act of 1940, as amended.
          (b) Each Underwriter severally agrees that such Underwriter shall not include any “issuer information” (as defined in Rule 433) in any “free writing prospectus” (as defined in Rule 405) used or referred to by such Underwriter without the prior consent of the Company and the Representatives (any such issuer information with respect to whose use the Company has given its consent, “ Permitted Issuer Information ”); provided that (i) no such consent shall be required with respect to any such issuer information contained in any document filed by the Company with the Commission prior to the use of such free writing prospectus and (ii) “issuer information,” as used in this Section 6(b), shall not be deemed to include information prepared by or on behalf of such Underwriter on the basis of or derived from Permitted Issuer Information.
     SECTION 7. Further Agreements of the Selling Stockholders . Each Selling Stockholder agrees:
          (a) During the Lock-Up Period, not to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at any time in the future of) any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other than the Stock), or (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of ownership of such shares of Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or other securities, in cash or otherwise, (3) file or cause to be filed a registration statement, including any amendments, with respect to the registration of any shares of Common Stock or securities convertible, exercisable or exchangeable into Common Stock or any other securities of the Company (other than any registration statements on Form S-8 or amendments thereto) or (4) publicly disclose the intention to do any of the foregoing, in each case without the prior written consent of Lehman Brothers Inc., on behalf of the Underwriters; notwithstanding the foregoing, if (i) during the last 17 days of the Lock-Up Period, the Company issues an earnings release or material news or a material event relating to the Company occurs or (ii) prior to the expiration of the Lock-Up Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Lock-Up Period, then


 

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          the restrictions imposed in this paragraph shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the announcement of the material news or the occurrence of the material event, unless Lehman Brothers Inc., on behalf of the Underwriters, waive such extension in writing.
          The foregoing restrictions shall not apply to: (a) the sale of Stock to the Underwriters pursuant to this Agreement; (b) the exercise of stock options granted pursuant to the Company’s stock option/incentive plans or otherwise outstanding on the date hereof, provided that the restrictions shall apply to any shares of the Company’s capital stock issued upon such exercise, or (c) sales or other dispositions of shares of any class of the Company’s capital stock, in each case that are made exclusively between and among such Selling Stockholder or members of the such Selling Stockholder’s family, or affiliates of the such Selling Stockholder, including its partners (if a partnership) or members (if a limited liability company); provided that it shall be a condition to any such transfer described in clause (c) that (i) the transferee/donee agrees with Lehman Brothers Inc., on behalf of the Underwriters, to be bound by the terms of the lock-up letter agreement substantially in the form of Exhibit A hereto, (ii) no filing by any party (donor, donee, transferor or transferee) under Exchange Act, shall be required or shall be voluntarily made in connection with such transfer or distribution (other than a filing on a Form 5, Schedule 13D or Schedule 13G (or 13D-A or 13G-A) made after the expiration of the Lock-Up Period), (iii) each party (donor, donee, transferor or transferee) shall not be required by law (including without limitation the disclosure requirements of the Securities Act and the Exchange Act) to make, and shall agree to not voluntarily make, any public announcement of the transfer or disposition, and (iv) such Selling Stockholder notifies the Representatives at least two business days prior to the proposed transfer or disposition.
          (b) Prior to engaging in any transaction or taking any other action that is subject to the terms of Section 7(a) during the period from the date of this Agreement to and including the 34 th day following the expiration of the Lock-Up Period, it will give notice thereof to the Company and will not consummate such transaction or take any such action unless it has received written confirmation from the Company that the Lock-Up Period (as such may have been extended pursuant to Section 7(a)) has expired.
          (c) Neither the Selling Stockholders nor any person acting on behalf of the Selling Stockholders (other than, if applicable, the Company and the Underwriters) shall use, prior to the completion of the Underwriters’ distribution of Stock, any “free writing prospectus” (as defined in Rule 405), relating to the Stock;
          (d) To deliver to the Representatives prior to the Initial Delivery Date a properly completed and executed United States Treasury Department Form W-8 (if the Selling Stockholder is a non-United States person) or Form W-9 (if the Selling Stockholder is a United States person).
     SECTION 8. Expenses . The Company agrees, whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, to pay all costs, expenses, fees and taxes incident to and in connection with (a) the authorization, issuance, sale and delivery of the Stock and any stamp duties or other taxes payable in that connection, and the preparation and printing of certificates for the Stock; (b) the preparation, printing and filing


 

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under the Securities Act of the Registration Statement (including any exhibits thereto), any Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus and any amendment or supplement thereto; (c) the distribution of the Registration Statement (including any exhibits thereto), any Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus and any amendment or supplement thereto, all as provided in this Agreement; (d) the production and distribution of this Agreement, any supplemental agreement among Underwriters, and any other related documents in connection with the offering, purchase, sale and delivery of the Stock; (e) any required review by the NASD of the terms of sale of the Stock (including related fees and expenses of counsel to the Underwriters in an amount that is not greater than $25,000); (f the listing of the Stock on the New York Stock Exchange and any other exchange; (g) the qualification of the Stock under the securities laws of the several jurisdictions as provided in Section 6(a)(ix) and the preparation, printing and distribution of a Blue Sky Memorandum (including related reasonable fees and expenses of counsel to the Underwriters); (h) the preparation, printing and distribution of one or more versions of the Preliminary Prospectus and the Prospectus for distribution in Canada often in the form of a Canadian “wrapper” (including related fees and expenses of Canadian counsel to the Underwriters); (i) the investor presentations on any “road show” undertaken in connection with the marketing of the Stock, including, without limitation, expenses associated with any electronic roadshow, travel and lodging expenses of the representatives and officers of the Company and the cost of any aircraft chartered in connection with the road show; and (j) all other costs and expenses incident to the performance of the obligations of the Company under this Agreement and under the Registration Rights Agreement, dated as of August 7, 2006 (the “ Registration Rights Agreement ”), among the Company and certain stockholders of the Company; provided that, except as provided in this Section 8, in accordance with the Registration Rights Agreement, the Selling Stockholders shall pay the respective costs and expenses incurred by them related to their performance hereunder, the respective underwriting discounts and commissions and any transfer taxes related to their sale of Stock hereunder; provided further that, except as provided in this Section 8 and in Section 13, the Underwriters shall pay their own costs and expenses, including the costs and expenses of their counsel, any transfer taxes on the Stock which they may sell and the expenses of advertising any offering of the Stock made by the Underwriters.
          Anything herein to the contrary notwithstanding, the provisions of this Section 8 shall not affect or modify, as amongst themselves, any agreement (including, without limitation, the Registration Rights Agreement) that the Company and the Selling Stockholders have made or may make for the allocation or sharing of such expenses and costs.
     SECTION 9. Conditions of Underwriters’ Obligations . The respective obligations of the Underwriters hereunder are subject to the accuracy, when made and on each Delivery Date, of the representations and warranties of the Company and the Selling Stockholders contained herein, to the performance by the Company and the Selling Stockholders of their respective obligations hereunder, and to each of the following additional terms and conditions:
          (a) The Prospectus shall have been timely filed with the Commission in accordance with Section 6(a)(i); the Company shall have complied with all filing requirements applicable to any Issuer Free Writing Prospectus used or referred to after the date hereof; no stop order suspending the effectiveness of the Registration Statement or preventing or suspending the use of the Prospectus or any Issuer Free Writing Prospectus shall have been issued and no


 

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proceeding or examination for such purpose shall have been initiated or threatened by the Commission; and any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been complied with.
          (b) No Underwriter shall have discovered and disclosed to the Company on or prior to such Delivery Date that the Registration Statement, the Prospectus or the Pricing Disclosure Package, or any amendment or supplement thereto, contains an untrue statement of a fact which, in the opinion of Simpson Thacher & Bartlett LLP, counsel for the Underwriters, is material or omits to state a fact which, in the opinion of such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading.
          (c) All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Stock, the Registration Statement, the Prospectus and any Issuer Free Writing Prospectus, and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to counsel for the Underwriters and the Company and the Selling Stockholders shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters.
          (d) Akin, Gump, Strauss, Hauer & Feld, L.L.P. shall have furnished to the Representatives their written opinion, as counsel to the Company, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Representatives, substantially in the form attached hereto as Exhibit B.
          (e) Michael Cavalier shall have furnished to the Representatives his written opinion, as General Counsel to the Company, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Representatives, substantially in the form attached hereto as Exhibit C.
          (f) The respective counsel for each of the Selling Stockholders shall have furnished to the Representatives their written opinion, as counsel to each of the Selling Stockholders for whom they are acting as counsel, addressed to the Underwriters and dated such Delivery Date, in form and substance reasonably satisfactory to the Representatives, substantially in the form attached hereto as Exhibit D.
          (g) The Representatives shall have received from Simpson Thacher & Bartlett LLP, counsel for the Underwriters, such opinion or opinions, dated such Delivery Date, with respect to the issuance and sale of the Stock, the Registration Statement, the Prospectus and the Pricing Disclosure Package and other related matters as the Representatives may reasonably require, and the Company shall have furnished to such counsel such documents as they reasonably request for the purpose of enabling them to pass upon such matters.
          (h) At the time of execution of this Agreement, the Representatives shall have received from each of (i) Deloitte & Touche LLP and (ii) Grant Thornton LLP a letter, in form and substance satisfactory to the Representatives, addressed to the Underwriters and dated the date hereof (A) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the


 

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qualification of accountants under Rule 2-01 of Regulation S-X of the Commission and (B) stating, as of the date hereof (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the most recent Preliminary Prospectus, as of a date not more than three days prior to the date hereof), the conclusions and findings of such firm with respect to the financial information and other matters ordinarily covered by accountants’ “ comfort letters ” to underwriters in connection with registered public offerings.
          (i) With respect to the letters of (i) Deloitte & Touche LLP and (ii) Grant Thornton LLP referred to in the preceding paragraph and delivered to the Representatives concurrently with the execution of this Agreement (the “ initial letters ”), the Company shall have furnished to the Representatives a letter (the “ bring-down letter ”) of each such accountants, addressed to the Underwriters and dated such Delivery Date (i) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the bring-down letter (or, with respect to matters involving changes or developments since the respective dates as of which specified financial information is given in the Prospectus, as of a date not more than three days prior to the date of the bring-down letter), the conclusions and findings of such firm with respect to the financial information and other matters covered by their initial letter and (iii) confirming in all material respects the conclusions and findings set forth in their initial letter.
          (j) The Company shall have furnished to the Representatives a certificate, dated such Delivery Date, of its Chief Executive Officer and its Chief Financial Officer stating that:
     (i) The representations and warranties of the Company in Section 1 are true and correct on and as of such Delivery Date, and the Company has complied with all its agreements contained herein and satisfied all the conditions on its part to be performed or satisfied hereunder at or prior to such Delivery Date;
     (ii) No stop order suspending the effectiveness of the Registration Statement has been issued; and no proceedings or examination for that purpose have been instituted or, to the knowledge of such officers, threatened; and
     (iii) They have carefully examined the Registration Statement, the Prospectus and the Pricing Disclosure Package, and, in their opinion, (A)(1) the Registration Statement, as of the Effective Date, (2) the Prospectus, as of its date and on the applicable Delivery Date, or (3) the Pricing Disclosure Package (together with the information included on Schedule 4 hereto, as of the Applicable Time, did not and do not contain any untrue statement of a material fact and did not and do not omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and (B) since the Effective Date, no event has occurred that should have been set forth in a supplement or amendment to the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus that has not been so set forth;


 

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          (k) Each Selling Stockholder shall have furnished to the Representatives on such Delivery Date a certificate, dated such Delivery Date, signed by, or on behalf of, the Selling Stockholder stating that the representations and warranties of the Selling Stockholder contained herein are true and correct on and as of such Delivery Date and that the Selling Stockholder has complied with all its agreements contained herein and has satisfied all the conditions on its part to be performed or satisfied hereunder at or prior to such Delivery Date.
          (l) Except as described in the most recent Preliminary Prospectus, (i) neither the Company nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included in the most recent Preliminary Prospectus any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, or (ii) since such date there shall not have been any change in the capital stock or long-term debt of the Company or any of its subsidiaries or any change, or any development involving a prospective change, in or affecting the condition (financial or otherwise), stockholders’ equity, results of operations, properties, business or prospects of the Company and its subsidiaries taken as a whole, the effect of which, in any such case described in clause (i) or (ii), is, in the judgment of the Representatives, so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Stock being delivered on such Delivery Date on the terms and in the manner contemplated in the Prospectus.
          (m) Subsequent to the execution and delivery of this Agreement (i) no downgrading shall have occurred in the rating accorded the Company’s or any of its subsidiaries’ debt securities by any " nationally recognized statistical rating organization ,” as that term is defined by the Commission for purposes of Rule 436(g)(2) of the Rules and Regulations and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company’s or any of its subsidiaries’ debt securities.
          (n) Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the following: (i) trading in securities generally on the New York Stock Exchange or the American Stock Exchange or in the over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market, shall have been suspended or materially limited or the settlement of such trading generally shall have been materially disrupted or minimum prices shall have been established on any such exchange or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction, (ii) a banking moratorium shall have been declared by federal or state authorities, (iii) the United States shall have become engaged in hostilities (for the avoidance of doubt, excluding the current hostilities in Iraq), there shall have been an escalation in hostilities involving the United States or there shall have been a declaration of a national emergency or war by the United States or (iv) there shall have occurred such a material adverse change in general economic, political or financial conditions, including without limitation as a result of terrorist activities after the date hereof, (or the effect of international conditions on the financial markets in the United States shall be such) as to make it, in the judgment of the Representatives, impracticable or inadvisable to proceed with the public offering or delivery of the Stock being delivered on such Delivery Date on the terms and in the manner contemplated in the Prospectus.


 

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          (o) The New York Stock Exchange, Inc. shall have approved the Stock for listing, subject only to official notice of issuance and evidence of satisfactory distribution.
          (p) The Lock-Up Agreements among Lehman Brothers Inc., on behalf of the Underwriters, and the officers, directors and stockholders of the Company set forth in Schedule 5 hereto, delivered to Lehman Brothers Inc. on or before the date of this Agreement, shall be in full force and effect on such Delivery Date.
          All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters. The Representatives may in their sole discretion waive on behalf of the Underwriters compliance with any conditions to the obligations of the Underwriters hereunder.
     SECTION 10. Indemnification and Contribution.
          (a) The Company shall indemnify and hold harmless each Underwriter, its directors, officers and employees and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Securities Act, and each Selling Stockholder, its directors, officers and employees, and each person, if any, who controls any Selling Stockholder within the meaning of Section 15 of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of Stock), to which that Underwriter, Selling Stockholder, director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in (A) any Preliminary Prospectus, the Registration Statement or the Prospectus or in any amendment or supplement thereto, (B) any Issuer Free Writing Prospectus or in any amendment or supplement thereto, (C) any Permitted Issuer Information used or referred to in any “free writing prospectus” (as defined in Rule 405) used or referred to by any Underwriter or (D) any “road show” (as defined in Rule 433) not constituting an Issuer Free Writing Prospectus (a “ Non-Prospectus Road Show ”), or (ii) the omission or alleged omission to state in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto, or in any Permitted Issuer Information, any Non-Prospectus Road Show, any material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse each Underwriter and Selling Stockholder and each such director, officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by that Underwriter, Selling Stockholder, director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred; provided , however , that the Company shall not be liable to any Underwriter in any such case to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any such amendment or supplement thereto or in any Permitted Issuer Information or Non-Prospectus Road Show, in reliance upon and in conformity with written information concerning such Underwriter furnished to the Company


 

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through the Representatives by or on behalf of any Underwriter specifically for inclusion therein which information consists solely of the information specified in Section 10(f); and provided , further , that the Company shall not be liable to any Selling Stockholder or to any director, officer, employee or controlling person of that Selling Stockholder to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any such amendment or supplement thereto or in any Permitted Issuer Information or Non-Prospectus Road Show, in reliance upon and in conformity with written information concerning any Selling Stockholder furnished to the Company by or on behalf of any Selling Stockholder specifically for inclusion therein. The foregoing indemnity agreement is in addition to any liability which the Company may otherwise have to (i) any Underwriter or to any director, officer, employee or controlling person of that Underwriter or (ii) any Selling Stockholder or to any director, officer, employee or controlling person of that Selling Stockholder.
          (b) Each Selling Stockholder, severally but not jointly, shall indemnify and hold harmless each Underwriter, its directors, officers and employees, and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating to purchases and sales of Stock), to which that Underwriter, director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Permitted Issuer Information, any Non-Prospectus Road Show or any “free writing prospectus” (as defined in Rule 405), prepared by or on behalf of such Selling Stockholder or used or referred to by such Selling Stockholder in connection with the offering of the Stock in violation of Section 7(d) (a “ Selling Stockholder Free Writing Prospectus ”), or (ii) the omission or alleged omission to state in any Preliminary Prospectus, Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Permitted Issuer Information, any Non-Prospectus Road Show or any Selling Stockholder Free Writing Prospectus, any material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse each Underwriter, its directors, officers and employees and each such controlling person promptly upon demand for any legal or other expenses reasonably incurred by that Underwriter, its directors, officers and employees or controlling persons in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred; provided , however , that each Selling Stockholder shall be liable in any such case only to the extent that any such loss, claim, damage, liability or action arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or any such amendment or supplement or in any Permitted Issuer Information or Non-Prospectus Road Show in reliance upon and in conformity with written information concerning such Selling Stockholder furnished to the Company by such Selling Stockholder specifically for inclusion therein or arises out of, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any Selling Stockholder Free Writing Prospectus. The liability of each Selling


 

26

Stockholder under the indemnity agreement contained in this paragraph shall be limited to an amount equal to the total net proceeds from the offering of the shares of the Stock purchased under this Agreement received by such Selling Stockholder, as set forth in the table on the cover page of the Prospectus. The foregoing indemnity agreement is in addition to any liability that the Selling Stockholders may otherwise have to any Underwriter or any officer, employee or controlling person of that Underwriter.
          (c) Each Underwriter, severally and not jointly, shall indemnify and hold harmless the Company, each Selling Stockholder, their respective directors, officers and employees, and each person, if any, who controls the Company or such Selling Stockholder within the meaning of Section 15 of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof, to which the Company, such Selling Stockholder or any such director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Non-Prospectus Road Show, or (ii) the omission or alleged omission to state in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Non-Prospectus Road Show, any material fact required to be stated therein or necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information concerning such Underwriter furnished to the Company through the Representatives by or on behalf of that Underwriter specifically for inclusion therein which information is limited to the information specified in Section 10(f), and shall reimburse the Company and any such director, officer or controlling person for any legal or other expenses reasonably incurred by the Company, such Selling Stockholder or any such director, officer, employee or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim, damage, liability or action as such expenses are incurred. The foregoing indemnity agreement is in addition to any liability that any Underwriter may otherwise have to the Company, such Selling Stockholder or any such director, officer, employee or controlling person.
          (d) Promptly after receipt by an indemnified party under this Section 10 of notice of any claim or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 10, notify the indemnifying party in writing of the claim or the commencement of that action; provided , however , that the failure to notify the indemnifying party shall not relieve it from any liability which it may have under this Section 10 except to the extent it has been materially prejudiced by such failure and, provided further, that the failure to notify the indemnifying party shall not relieve it from any liability which it may have to an indemnified party otherwise than under this Section 10. If any such claim or action shall be brought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the


 

27

indemnified party under this Section 10 for any legal or other expenses subsequently incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided , however , that the indemnified party shall have the right to employ counsel to represent jointly the indemnified party and those other indemnified parties and their respective directors, officers, employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may be sought under this Section 10 if (i) the indemnified party and the indemnifying party shall have so mutually agreed; (ii) the indemnifying party has failed within a reasonable time to retain counsel reasonably satisfactory to the indemnified party; (iii) the indemnified party and its directors, officers, employees and controlling persons shall have reasonably concluded that there may be legal defenses available to them that are different from or in addition to those available to the indemnifying party; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the indemnified parties or their respective directors, officers, employees or controlling persons, on the one hand, and the indemnifying party, on the other hand, and representation of both sets of parties by the same counsel would be inappropriate due to actual or potential differing interests between them, and in any such event the fees and expenses of such separate counsel shall be paid by the indemnifying party. No indemnifying party shall (i) without the prior written consent of the indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and does not include any findings of fact or admissions of fault or culpability as to the indemnified party, or (ii) be liable for any settlement of any such action effected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or if there be a final judgment for the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment.
          (e) If the indemnification provided for in this Section 10 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 10(a), 10(b) or 10(c) in respect of any loss, claim, damage or liability, or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other, from the offering of the Stock or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other, with respect to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative benefits received by the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other, with respect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Stock purchased under this Agreement (before deducting expenses) received by the Company and the Selling


 

28

Stockholders, as set forth in the table on the cover page of the Prospectus, on the one hand, and the total underwriting discounts and commissions received by the Underwriters with respect to the shares of the Stock purchased under this Agreement, as set forth in the table on the cover page of the Prospectus, on the other hand. The relative fault shall be determined by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company, the Selling Stockholders or the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company, the Selling Stockholders and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 10(e) were to be determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respect thereof, referred to above in this Section shall be deemed to include, for purposes of this Section 10(e), any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 10(e), (i) no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Stock underwritten by it and distributed to the public was offered to the public exceeds the amount of any damages which such Underwriter has otherwise paid or become liable to pay by reason of any untrue or alleged untrue statement or omission or alleged omission and (ii) no Selling Stockholder shall be required to contribute any amount in excess of the total net proceeds from the offering of the shares of the Stock purchased under this Agreement received by such Selling Stockholder. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’ obligations to contribute as provided in this Section 10(e) are several in proportion to their respective underwriting obligations and not joint.
          (f) The Underwriters severally confirm and the Company and each Selling Stockholder acknowledges and agrees that the statements regarding delivery of shares by the Underwriters set forth on the cover page of, and the concession and reallowance figures and the paragraphs relating to stabilization, electronic distribution and discretionary sales by the Underwriters appearing under the caption “Underwriting” in, the most recent Preliminary Prospectus and the Prospectus constitute the only information concerning such Underwriters furnished in writing to the Company by or on behalf of the Underwriters specifically for inclusion in any Preliminary Prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto or in any Non-Prospectus Road Show.
     SECTION 11. Defaulting Underwriters . If, on any Delivery Date, any Underwriter defaults in the performance of its obligations under this Agreement, the remaining non-defaulting Underwriters shall be obligated to purchase the Stock that the defaulting Underwriter agreed but failed to purchase on such Delivery Date in the respective proportions which the number of shares of the Firm Stock set forth opposite the name of each remaining non-defaulting Underwriter in Schedule 1 hereto bears to the total number of shares of the Firm Stock set forth opposite the names of all the remaining non-defaulting Underwriters in Schedule 1 hereto; provided , however , that the remaining non-defaulting Underwriters shall not be obligated to purchase any of the Stock on such Delivery Date if the total number of shares of the Stock that the defaulting Underwriter or Underwriters agreed but failed to purchase on such date exceeds 9.09% of the total number of shares of the Stock to be purchased on such Delivery Date, and any remaining non-defaulting Underwriter shall not be obligated to


 

29

purchase more than 110% of the number of shares of the Stock that it agreed to purchase on such Delivery Date pursuant to the terms of Section 3. If the foregoing maximums are exceeded, the remaining non-defaulting Underwriters, or those other underwriters satisfactory to the Representatives who so agree, shall have the right, but shall not be obligated, to purchase, in such proportion as may be agreed upon among them, all the Stock to be purchased on such Delivery Date. If the remaining Underwriters or other underwriters satisfactory to the Representatives do not elect to purchase the shares that the defaulting Underwriter or Underwriters agreed but failed to purchase on such Delivery Date, this Agreement (or, with respect to any Option Stock Delivery Date, the obligation of the Underwriters to purchase, and of the Company to sell, the Option Stock) shall terminate without liability on the part of any non-defaulting Underwriter or the Company or the Selling Stockholders, except that the Company will continue to be liable for the payment of expenses to the extent set forth in Sections 8 and 13. As used in this Agreement, the term “ Underwriter ” includes, for all purposes of this Agreement unless the context requires otherwise, any party not listed in Schedule 1 hereto that, pursuant to this Section 11, purchases Stock that a defaulting Underwriter agreed but failed to purchase.
          Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company and the Selling Stockholders for damages caused by its default. If other Underwriters are obligated or agree to purchase the Stock of a defaulting or withdrawing Underwriter, either the Representatives or the Company may postpone the Delivery Date for up to seven full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Underwriters may be necessary in the Registration Statement, the Prospectus or in any other document or arrangement.
     SECTION 12. Termination . The obligations of the Underwriters hereunder may be terminated by the Representatives by notice given to and received by the Company and the Selling Stockholders prior to delivery of and payment for the Firm Stock if, prior to that time, any of the events described in Sections 9(l), 9(m) or 9(n), shall have occurred or if the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement.
     SECTION 13. Reimbursement of Underwriters’ Expenses . If (a) the Company or any Selling Stockholder shall fail to tender the Stock for delivery to the Underwriters for any reason or (b) the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement, the Company will reimburse the Underwriters for all reasonable out-of-pocket expenses (including fees and disbursements of counsel) incurred by the Underwriters in connection with this Agreement and the proposed purchase of the Stock, and upon demand the Company shall pay the full amount thereof to the Representatives. If this Agreement is terminated pursuant to Section 11 by reason of the default of one or more Underwriters, neither the Company nor any Selling Stockholder shall be obligated to reimburse any defaulting Underwriter on account of those expenses.
     SECTION 14. Research Analyst Independence. The Company acknowledges that the Underwriters’ research analysts and research departments are required to be independent from


 

30

their respective investment banking divisions and are subject to certain regulations and internal policies, and that such Underwriters’ research analysts may hold views and make statements or investment recommendations and/or publish research reports with respect to the Company and/or the offering that differ from the views of their respective investment banking divisions. The Company and the Selling Stockholders hereby waive and release, to the fullest extent permitted by law, any claims that the Company or the Selling Stockholders may have against the Underwriters with respect to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Company or the Selling Stockholders by such Underwriters’ investment banking divisions. The Company and the Selling Stockholders acknowledge that each of the Underwriters is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short positions in debt or equity securities of the companies that may be the subject of the transactions contemplated by this Agreement.
          SECTION 15. No Fiduciary Duty. The Company and the Selling Stockholders acknowledge and agree that in connection with this offering, sale of the Stock or any other services the Underwriters may be deemed to be providing hereunder, notwithstanding any preexisting relationship, advisory or otherwise, between the parties or any oral representations or assurances previously or subsequently made by the Underwriters: (i) no fiduciary or agency relationship between the Company, Selling Stockholders and any other person, on the one hand, and the Underwriters, on the other, exists; (ii) the Underwriters are not acting as advisors, expert or otherwise, to either the Company or the Selling Stockholders, including, without limitation, with respect to the determination of the public offering price of the Stock, and such relationship between the Company and the Selling Stockholders, on the one hand, and the Underwriters, on the other, is entirely and solely commercial, based on arms-length negotiations; (iii) any duties and obligations that the Underwriters may have to the Company or Selling Stockholders shall be limited to those duties and obligations specifically stated herein; and (iv) the Underwriters and their respective affiliates may have interests that differ from those of the Company and the Selling Stockholders. The Company and the Selling Stockholders hereby waive any claims that the Company or the Selling Stockholders may have against the Underwriters with respect to any breach of fiduciary duty in connection with this offering.
     SECTION 16. Notices, Etc. All statements, requests, notices and agreements hereunder shall be in writing, and:
          (a) if to the Underwriters, shall be delivered or sent by mail or facsimile transmission to the Representatives, c/o Lehman Brothers Inc., 745 Seventh Avenue, New York, New York 10019, Attention: Syndicate Registration (Fax:646-834-8133), with a copy, in the case of any notice pursuant to Section 10(d), to the Director of Litigation, Office of the General Counsel, Lehman Brothers Inc., 399 Park Avenue, 10th Floor, New York, New York 10022 (Fax: 212-520-0421);
          (b) if to the Company, shall be delivered or sent by mail or facsimile transmission to the address of the Company set forth in the Registration Statement, Attention: Michael Cavalier (Fax: 972-665-1004), with a copy to Akin, Gump, Strauss, Hauer & Feld,


 

31

L.L.P., Attention: Terry M. Schpok, P.C., 1700 Pacific Avenue, Suite 4100, Dallas, Texas 75201; and
          (c) if to any Selling Stockholder, shall be delivered or sent by mail or facsimile transmission to such Selling Stockholder at the address set forth on Schedule 2 hereto.
Any such statements, requests, notices or agreements shall take effect at the time of receipt thereof. The Company and the Selling Stockholders shall be entitled to act and rely upon any request, consent, notice or agreement given or made on behalf of the Underwriters by the Representatives.
     SECTION 17. Persons Entitled to Benefit of Agreement . This Agreement shall inure to the benefit of and be binding upon the Underwriters, the Company, the Selling Stockholders and their respective personal representatives and successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (A) the representations, warranties, indemnities and agreements of the Company and the Selling Stockholders contained in this Agreement shall also be deemed to be for the benefit of the directors, officers and employees of the Underwriters and each person or persons, if any, who control any Underwriter within the meaning of Section 15 of the Securities Act, (B) the representations, warranties, indemnities and agreements of the Company contained in Section 10(a) of this Agreement shall be deemed to be for the benefit of the directors, officers and employees of the Selling Stockholders, and each person, if any, who controls any Selling Stockholder within the meaning of Section 15 of the Securities Act, and (C) the indemnity agreement of the Underwriters contained in Section 10(c) of this Agreement shall be deemed to be for the benefit of the directors of the Company, the officers of the Company who have signed the Registration Statement and any person controlling the Company within the meaning of Section 15 of the Securities Act and of the directors, officers and employees, and each person, if any, who controls any Selling Stockholder within the meaning of Section 15 of the Securities Act. Nothing in this Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section 17, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein.
     SECTION 18. Survival . The respective indemnities, representations, warranties and agreements of the Company, the Selling Stockholders and the Underwriters contained in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall survive the delivery of and payment for the Stock and shall remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them.
     SECTION 19. Definition of the Terms “ Business Day ” and “ Subsidiary " . For purposes of this Agreement, (a) “ business day ” means each Monday, Tuesday, Wednesday, Thursday or Friday that is not a day on which banking institutions in New York are generally authorized or obligated by law or executive order to close and (b) “ subsidiary ” has the meaning set forth in Rule 405 of the Rules and Regulations.
     SECTION 20. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of New York.


 

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     SECTION 21. Counterparts . This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument.
     SECTION 22. Headings . The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement.
[ Remainder of this page intentionally left blank ]


 

 

     If the foregoing correctly sets forth the agreement among the Company, the Selling Stockholders and the Underwriters, please indicate your acceptance in the space provided for that purpose below.
             
        Very truly yours,
 
           
        CINEMARK HOLDINGS, INC.
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        MADISON DEARBORN CAPITAL PARTNERS IV, L.P.
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        NORTHWESTERN UNIVERSITY
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        JOHN W. MADIGAN
 
           
 
      By:    
 
           
        Name:
        Title:


 

2

             
        K&E INVESTMENT PARTNERS, L.L.C.-2004-B DIF
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        QUADRANGLE CAPITAL PARTNERS LP
 
           
 
      By:   Quadrangle GP Investors LP
 
      Its:   General Partner
 
           
 
      By:   Quadrangle GP Investors, LLC
 
      Its:   General Partner
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        QUADRANGLE SELECT PARTNERS LP
 
           
 
      By:   Quadrangle GP Investors LP
 
      Its:   General Partner
 
           
 
      By:   Quadrangle GP Investors, LLC
 
      Its:   General Partner
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        QUADRANGLE CAPITAL PARTNERS A LP
 
           
 
      By:   Quadrangle GP Investors LP
 
      Its:   General Partner
 
           
 
      By:   Quadrangle GP Investors, LLC
 
      Its:   General Partner


 

3

             
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        QUADRANGLE (CINEMARK) CAPITAL PARTNERS LP
 
           
 
      By:   Quadrangle GP Investors LP
 
      Its:   General Partner
 
           
 
      By:   Quadrangle GP Investors, LLC
 
      Its:   General Partner
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
        SYUFY ENTERPRISES LP
 
           
 
      By:    
 
           
        Name:
        Title:
 
           
Accepted:        
 
           
Lehman Brothers Inc.        
 
           
By:
           
 
           
Authorized Representative        
 
           
Credit Suisse Securities (USA) LLC        
 
           
By:
           
 
           
Authorized Representative        


 

4

             
Merrill Lynch, Pierce, Fenner & Smith Incorporated        
 
           
By:
           
 
           
Authorized Representative        
 
           
Morgan Stanley & Co. Incorporated        
 
           
By:
           
 
           
Authorized Representative        
 
           
For themselves and as Representatives of the several Underwriters named in Schedule 1 hereto        
 

EXHIBIT 4.6
CINEMARK HOLDINGS, INC.
DIRECTOR NOMINATION AGREEMENT
     This Director Nomination Agreement (this “ Agreement ”) is made as of April 9, 2007, among Cinemark Holdings, Inc., a Delaware corporation (the “ Company ”), Madison Dearborn Capital Partners IV, L.P., a Delaware limited partnership (“ MDCP ”), each of the investors listed on the Schedule of Mitchell Investors attached hereto (collectively, the “ Mitchell Investors ”), each of the investors listed on the Schedule of Quadrangle Investors attached hereto, (collectively, the “ Quadrangle Investors ”), Syufy Enterprises, LP, a California limited partnership (the “ Syufy Investor ”) and the additional investors listed on the Schedule of Additional Investors (collectively, the “ Additional Investors ”). MDCP, the Mitchell Investors, the Quadrangle Investors, the Syufy Investor and the Additional Investors are collectively referred to herein as the “ Stockholders ” and individually as a “ Stockholder .” Unless otherwise specified herein, all of the capitalized terms used herein are defined in Section 6 hereof.
      WHEREAS , the Company and the stockholders of the Company entered into that certain Stockholders Agreement dated as of August 7, 2006 (the “ Stockholders Agreement ”) (capitalized terms used herein but not otherwise defined shall have the meanings assigned to such terms in the Stockholders Agreement);
      WHEREAS , the Stockholders own shares of common stock, par value, $0.001 per share, of the Company (the “ Common Stock ”) and, in some cases, options to acquire shares of Common Stock;
      WHEREAS , the Company is contemplating an offer and sale of its Common Stock to the public in an underwritten initial public offering registered under the Securities Act (the “ IPO ”);
      WHEREAS , the parties hereto desire to terminate the Stockholders Agreement upon the consummation of an IPO.
      WHEREAS , the Company has agreed to permit MDCP, the Mitchell Investors, the Quadrangle Investors and the Syufy Investor to designate persons for nomination for election to the board of directors of the Company (the “ Board ”) on the terms and conditions set forth herein.
      NOW, THEREFORE , in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:
     1.  Board of Directors .
          (a) From and after the Effective Time and until the provisions of this Section 1 cease to be effective and subject to the terms and conditions of this Agreement, the following holders of Stockholder Shares shall have the right to designate persons to be appointed or nominated, as the case may be, for election to the Board (each a “ Nominee ”) as follows:

 


 

          (i) two representatives designated by the Mitchell Investors (determined by a vote of the Mitchell Investors owning a majority of the Stockholder Shares held by all Mitchell Investors) (the “ Mitchell Nominees ”), who shall be initially: Lee Roy Mitchell and one other individual to be nominated by Lee Roy Mitchell; provided that at least one of such Mitchell Nominees shall be Independent so long as the Company is required by NYSE Rules to have a majority of Independent directors on the Board;
          (ii) five representatives designated by MDCP (the “ MDCP Nominees ”) provided that at least three of such MDCP Nominees shall be Independent so long as the Company is required by NYSE Rules to have a majority of Independent directors on the Board;
          (iii) one representative designated by the Quadrangle Investors (the “ Quadrangle Nominee ”), who shall initially be Peter Ezersky; provided that such Quadrangle Nominee shall be Independent so long as the Company is required by NYSE Rules to have a majority of Independent directors on the Board; and
          (iv) one representative designated by the Syufy Investor (the “ Syufy Nominee ”), who shall initially be Raymond W. Syufy; and one Observer (as defined below) designated by the Syufy Investor in accordance with Section 1(a)(iv) below, who shall initially be Joseph A. Syufy.
          (b) Notwithstanding the foregoing, in the event that a Person loses its right to designate a director for appointment or nomination in accordance with Section 1(e) below, the director designated by such Person may be removed at the request of a majority of the Board (excluding such director or directors) upon the occurrence of such event and the total authorized number of directors may be reduced upon such action by a majority of the Board (excluding such director or directors) by the number of directors that such Person loses its rights to nominate.
          (c) The representatives designated hereunder by any Stockholder shall be nominated or appointed, as the case may be, to serve as a Class I, Class II or Class III director (as defined in the Company’s Certificate of Incorporation), as the case may be, as set forth on the Schedule of Directors attached hereto. The initial term of each Class I, Class II and Class III Director shall expire as set forth in the Company’s Certificate of Incorporation. Any director designated by a Stockholder hereunder to fill a vacancy on the board of directors shall be designated as the same class of director as the director whose termination of services as a director created such vacancy or to fill a vacancy as listed on the Schedule of Directors.
          (d) The Company shall pay the reasonable out-of-pocket expenses incurred by each director in connection with attending the meetings of the Board and any committee thereof.
          (e) Notwithstanding anything to the contrary contained herein,
          (i) at such time as the Mitchell Investors and their Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock; the rights of the Mitchell Investors under this Section 1 to nominate any Mitchell Nominee shall terminate automatically and cease to have any further force or

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effect. In the event that the Mitchell Investors and their Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock, the Mitchell Investors shall have the right to designate one observer to the Board (an “ Observer ”), which shall either be Lee Roy Mitchell or Tandy Mitchell. An Observer shall be entitled to attend all meetings of the Board but shall not be entitled to (x) attend meetings of the Board with counsel which may constitute privileged communications, (y) attend meetings of the Board which include topics of discussion which may constitute a conflict of interest between the Company and the Mitchell Investors, or (z) vote on any matters voted on by the Board. The determination of whether a conflict of interest exists for purposes of clause (y) in the immediately preceding sentence shall be made by a majority of the Board. If such a determination is made prior to a Board meeting, the Board shall provide written notice to the Mitchell Investors setting forth in reasonable detail the basis for such conflict of interest. Such a determination may be made during an ongoing Board meeting by a majority of the Board and, upon such determination, the Observer shall immediately leave the meeting. Upon the conclusion of the discussion (including any action by the Board thereon) which constitutes a conflict of interest between the Company and the Mitchell Investors, the Observer shall be invited to return to the meeting. The Mitchell Investors’ right to designate an Observer shall terminate automatically and cease to have any further force or effect upon the earlier to occur of (i) the Observer designated under this Section 1(e)(i) is not Lee Roy Mitchell or Tandy Mitchell; and (ii) the Mitchell Investors and their Permitted Transferees cease to hold in the aggregate at least 2% of the outstanding shares of Common Stock. The right of the Mitchell Investors to designate an Observer hereunder shall not be transferable or assignable under any circumstances;
          (ii) the rights of the Mitchell Investors under this Section 1 shall terminate automatically and cease to have any further force or effect at such time as the Mitchell Investors and their Permitted Transferees hold, directly or indirectly, more than a 5% interest of any business (other than the Company) that owns, operates or manages theatres with more than 800 movie screens in the aggregate in the Western Hemisphere;
          (iii) the rights of the Quadrangle Investors under this Section 1 to nominate the Quadrangle Nominee shall terminate automatically and cease to have any further force or effect at such time as the Quadrangle Investors and their Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock. In the event that the Quadrangle Investors and their Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock, the Quadrangle Investors shall have the right to designate an Observer, which shall be a member or employee of Quadrangle Group LLC. An Observer shall be entitled to attend all meetings of the Board but shall not be entitled to (x) attend meetings of the Board with the Company’s counsel or the Board’s special counsel which may constitute privileged communications, (y) attend meetings of the Board which include topics of discussion which may constitute a conflict of interest between the Company and the Quadrangle Investors or (z) vote on any matters voted on by the Board. The determination of whether a conflict of interest exists for purpose of clause (y) in the immediately preceding sentence shall be made by a majority of the Board. If such a determination is made prior to a Board meeting, the Board shall provide written notice to the Quadrangle Investors

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setting forth in reasonable detail the basis for such conflict of interest. Such a determination may be made during an ongoing Board meeting by a majority of the Board and upon such determination the Observer shall immediately leave the meeting. Upon the conclusion of the discussion (including any action by the Board thereon) which constitutes a conflict of interest between the Company and the Quadrangle Investors, the Observer shall be invited to return to the meeting. The Quadrangle Investors’ right to designate an Observer shall terminate automatically and cease to have any further force or effect upon the earlier to occur of (i) the Observer designated under this Section 1(e)(iii) is not a member or employee of Quadrangle Group LLC (it being understood and agreed that, should the current Observer at any time cease to be a member or employee of Quadrangle Group LLC, the Quadrangle Investors’ right to designate an Observer shall not terminate unless the Quadrangle Investors do not designate a replacement Observer who is a member or employee of the Quadrangle Group LLC within 5 business days thereof); and (ii) the Quadrangle Investors and their Permitted Transferees cease to hold in the aggregate at least 2% of the outstanding shares of Common Stock. The rights of the Quadrangle Investors to nominate the Quadrangle Director or designate an Observer hereunder shall not be transferable or assignable under any circumstances, except to a Permitted Transferee of the Quadrangle Investors;
          (iv) the rights of the Syufy Investor under this Section 1 to nominate the Syufy Nominee shall terminate automatically and cease to have any further force or effect at such time as the Syufy Investor and its Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock. In addition, the rights of the Syufy Investor under this Section 1 to nominate the Syufy Nominee and designate an Observer shall terminate automatically and cease to have any further force or effect at such time as (1) the Syufy Investor, Raymond W. Syufy or Joseph Syufy breach the terms of Section 3 of the Non-Competition and Non-Disclosure Agreement, dated August 7, 2006, by and among the Syufy Investor, Raymond W. Syufy, Joseph Syufy and the Company (the “ Syufy Non-Competition Agreement ”) (this clause (1), a “ Non-Curable Termination Event ”) or (2) the Syufy Investor or its Permitted Transferees, Raymond Syufy or Joseph Syufy (each, a “ Syufy Person ”) holds, directly or indirectly, any interest of any business (other than the Company) that owns, operates or manages movie theatres that are not drive-in theaters (a “ Competing Business ”) but where such ownership would not violate Section 3 of the Syufy Non-Competition Agreement (this clause (2), a “ Curable Termination Event ”); provided that the foregoing loss of rights upon the ownership, operation or management of a Competing Business shall not apply to (i) holding up to a 5% interest in any publicly traded company; or (ii) holding an ownership interest in a Competing Business that (x) owns, operates or manages less than 100 screens in the aggregate in any one or more states in which the Company does not, at the time the Syufy Person first acquires such ownership interest, own, operate or manage a movie theater and/or (y) owns, operates or manages less than 32 screens in the aggregate in any one or more states in which the Company, at the time the Syufy Person first acquires such ownership interest, owns, operates or manages a movie theater. For purposes of calculating the number of screens for purposes of clause (ii) of the foregoing sentence, movie screens acquired by a Syufy Person following an event of default under a lease under which the Syufy Person is the lessor and which gives such lessor the right to regain possession of and operate such theatre shall be disregarded

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unless the Syufy Person demolishes and rebuilds a new theatre on the property. In the event that the rights of the Syufy Investor to nominate the Syufy Nominee terminates by reason of a Curable Termination Event, the Syufy Investor shall have the right to cure such Curable Termination Event and the Syufy Investor’s rights to nominate the Syufy Nominee and designate an Observer shall be reinstated at such time as there is no longer a Curable Termination Event in effect. In the event that the Syufy Investor and its Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock, the Syufy Investor shall continue to have the right to designate an Observer, which shall be a director of the general partner of, or an executive officer of, Syufy Enterprises; provided, however, that this right to designate an Observer shall not be granted to the Syufy Investor if the Syufy Investor is in violation of the terms of the preceding sentence. An Observer shall be entitled to attend all meetings of the Board but shall not be entitled to (x) attend meetings of the Board with the Company’s counsel or the Board’s special counsel which may constitute privileged communications, (y) attend meetings of the Board which include topics of discussion which may constitute a conflict of interest between the Company and the Syufy Investor or (z) vote on any matters voted on by the Board. The determination of whether a conflict of interest exists for purpose of clause (y) in the immediately preceding sentence shall be made by a majority of the Board. If such a determination is made prior to a Board meeting, the Board shall provide written notice to the Syufy Investor setting forth in reasonable detail the basis for such conflict of interest. Such a determination may be made during an ongoing Board meeting by a majority of the Board and upon such determination the Observer shall immediately leave the meeting. Upon the conclusion of the discussion (including any action by the Board thereon) which constitutes a conflict of interest between the Company and the Syufy Investor, the Observer shall be invited to return to the meeting. The Syufy Investor’s right to designate an Observer shall terminate automatically and cease to have any further force or effect upon the earlier to occur of (i) the Observer designated under this Section 1(e)(iii) is not a director of the general partner or an executive officer of Syufy Enterprises (it being understood and agreed that, should the current Observer at any time cease to be a director of the general partner or an executive officer of Syufy Enterprises, the Syufy Investor’s right to designate an Observer shall not terminate unless the Syufy Investor does not designate a replacement Observer who is a member of the board of directors of the general partner or an executive officer of Syufy Enterprises within 5 business days thereof); and (ii) the Syufy Investor and their Permitted Transferees cease to hold in the aggregate at least 2% of the outstanding shares of Common Stock. The rights of the Syufy Investor to nominate the Syufy Nominee or designate an Observer hereunder shall not be transferable or assignable under any circumstances, except to a Permitted Transferee of the Syufy Investor; and
          (v) the rights of MDCP under this Section 1 shall terminate automatically and cease to have any further force or effect at such time as MDCP and its Permitted Transferees hold in the aggregate less than 3% of the outstanding shares of Common Stock.
          (f) At every meeting of the Board, or a committee thereof, for which Directors are appointed or are nominated to stand for election by stockholders of the Company, each Stockholder will have the right to designate those persons to be appointed or nominated for election to the Board for each Retiring Director that was a prior Nominee of such Stockholder in accordance with this Section 1 .

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          (g) If a vacancy occurs because of the death, disability, disqualification, resignation or removal of a Nominee, the Stockholders who designated such person shall be entitled to designate such person’s successors in accordance with this Agreement and the Board, subject to a determination of the Board in good faith, after consultation with outside legal counsel, that such action would not constitute a breach of its fiduciary duties or applicable law, shall fill the vacancy with such successor Nominee.
          (h) If a Nominee is not nominated or elected to the Board because of the Nominee’s death, disability, disqualification, withdrawal as a nominee or for other reason is unavailable or unable to serve on the Board, the Stockholder who designated such person shall be entitled to designate promptly another Nominee and the director position for which such Nominee was nominated shall not be filled pending such designation.
     2.  Company Obligations .
          (a) The Company agrees to use its best efforts to assure that (i) each Nominee is included in the Board’s slate of nominees to the stockholders for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in connection with soliciting proxies for every meeting of the stockholders of the Company called with respect to the election of members of the Board, and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
          (b) Notwithstanding anything herein to the contrary, the Company shall not be obligated to cause to be nominated for election to the Board or recommend to the stockholders the election of any Nominee (i) who fails to submit to the Company on a timely basis such questionnaires as the Company may reasonably require of its directors generally and such other information as the Company may reasonably request in connection with the preparation of its filings under the Securities Laws; or (ii) the Board or the Nominating Committee determines in good faith, after consultation with outside legal counsel, that such action would constitute a breach of its fiduciary duties or applicable law or violate the Company’s Certificate of Incorporation; provided, however , that upon the occurrence of either (i) or (ii) above, the Company shall promptly notify the applicable Stockholder of the occurrence of such event and permit the applicable Stockholder to provide an alternate Nominee sufficiently in advance of any Board action, the meetings of the stockholders called or written action of stockholders with respect to such election of nominees and the Company shall use commercially reasonable efforts to perform its obligations under Section 2(a) with respect to such alternate Nominee (provided that if the Company provides at least 45 days advance notice of the occurrence of any such event such alternative nominee must be designated by the applicable Stockholder not less than 30 days in advance of any Board action, notice of meeting of the stockholders or written action of stockholders with respect to such election of nominees). The Company shall use commercially reasonable efforts to perform its obligations under Section 2(a) with respect to such alternate Nominee provided, in no event shall the Company be obligated to postpone, reschedule or delay any scheduled meeting of the stockholders with respect to such election of Nominees.

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          (c) At any time a vacancy occurs because of the death, disability, resignation or removal of a Nominee, then the Board, or any committee thereof, shall not fill such vacancy until the earliest to occur of (i) such Stockholder has designated a successor Nominee and the Board has filled the vacancy and appointed such successor Nominee; (ii) such Stockholder fails to designate a successor Nominee within 30 business days after receiving notification of the vacancy from the Company; and (iii) such Stockholder has specifically waived its right under this Section 2(c) .
          (d) At any time that any Stockholder shall have any rights of designation under this Section 2 , the Company shall not take any action to reduce the size of the Board from 9, except as provided herein.
     3.  Termination of Stockholders Agreement . Upon the Effective Time, the Stockholders Agreement shall be hereby terminated and of no further force and effect, and no party thereto shall have any surviving obligations, rights, or duties thereunder after the Effective Time. From and after the Effective Time, the Additional Investors shall have no further obligations, rights or duties under this Agreement.
     4.  Effectiveness . The parties are entering into this Agreement in connection with a currently proposed IPO. This Agreement shall become automatically effective upon, and only upon, the time as of which the underwriters for the IPO shall have paid for all of the shares of Common Stock that they are obligated to purchase pursuant to the related underwriting agreement (the “ Underwriting Agreement ”), excluding any shares that the underwriters may have an option to purchase pursuant to the over-allotment option (the “ Effective Time ”). In the event the Effective Time does not occur on or before the earlier of (i) June 30, 2007 or (ii) the termination of the Underwriting Agreement, this Agreement shall, without further action, become null and void and of no further force and effect.
     5.  Definitions .
           “Affiliate ” of any Person is any other Person controlled by, controlling or under common control with such Person and in the case of any Stockholder that is a partnership or limited liability company, any partner or member of such Stockholder (provided that the Company shall not be deemed to be an affiliate of any Stockholder) or in the case of any Stockholder that is a trust, any beneficiary, trust for the benefit of the beneficiary or successor trust; provided that under no circumstances shall (i) any of the Mitchell Investors or their Permitted Transferees be Affiliates of (A) any of the Quadrangle Investors or their Permitted Transferees or (B) any of the Syufy Investor or their Permitted Transferees; (ii) any of the Quadrangle Investors or their Permitted Transferees be Affiliates of (A) any of the Mitchell Investors or their Permitted Transferees or (B) any of the Syufy Investor or their Permitted Transferees; or (iii) any of the Syufy Investor or their Permitted Transferees be Affiliates of (A) any of the Mitchell Investors or their Permitted Transferees or (B) any of the Quadrangle Investors or their Permitted Transferees, for purposes of this Agreement.
           “Agreement ” has the meaning set forth in the preamble.
           “Board ” has the meaning set forth in Section 1(a) .

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          “ Certificate of Incorporation ” means the Company’s Second Amended and Restated Certificate of Incorporation as the same may be amended from time to time.
          “ Common Stock ” has the meaning set forth in the preamble.
          “ Company ” has the meaning set forth in the preamble.
          “ Competing Business ” has the meaning set forth in Section 1(e)(iv) .
          “ Curable Termination Event ” has the meaning set forth in Section 1(e)(iv) .
          “ Effective Time ” has the meaning set forth in Section 4 .
          “ Family Group ” with respect to any Stockholder, means, such Stockholder’s spouse and descendants (whether natural or adopted) and any trust that is and remains solely for the benefit of such Stockholder and/or such Stockholder’s spouse and/or descendants.
          “ Independent ” means an “independent director” as defined by the NYSE Rules. The definition of “Independent” does not incorporate the additional independence requirements for audit committee members set forth in the NYSE Rules or Rule 10A-3 under the Securities Exchange Act of 1934.
          “ Independent Third Party ” means any Person other than MDCP or the Mitchell Investors.
          “ IPO ” has the meaning set forth in the recitals.
          “ Major Investor ” means MDCP, the Mitchell Investors, the Quadrangle Investors and the Syufy Investor.
          “ MDCP ” has the meaning set forth in the preamble.
          “ Mitchell Investors ” has the meaning set forth in the preamble.
          “ Mitchell Nominees ” has the meaning set forth in Section 1(a)(i) .
          “ Non-Curable Termination Event ” has the meaning set forth in Section 1(e)(iv) .
          “ NYSE Rules ” means the rules and policies of the New York Stock Exchange.
          “ Observer ” has the meaning set forth in Section 1(e)(i) .
          “ Permitted Transferee ” means any Transfer of Stockholder Shares by a Stockholder who is not a natural person to such Stockholder’s Affiliates or, in the case of a Stockholder who is a natural person, any Transfer by will or pursuant to the applicable laws of descent and distribution and any Transfer to or among such Stockholder’s Affiliates, and members of such holder’s Family Group or such Family Group member’s Affiliates.

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          “ Person ” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
          “ Quadrangle Nominee ” has the meaning set forth in Section 1(a)(iii) .
          “ Quadrangle Group LLC ” means Quadrangle Group LLC, a Delaware limited liability company.
          “ Quadrangle Investors ” has the meaning set forth in the preamble.
          “ Retiring Director ” means any director whose term expires at the next annual meeting of the Stockholders of the Company pursuant to the terms of the Company’s Certificate of Incorporation.
          “ Securities Laws ” means the Securities Act of 1933, as amended from time to time and the Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder.
          “ Stockholder Shares ” means (i) any Company Common Stock owned by any Stockholder; and (ii) any capital stock or other equity securities issued or issuable directly or indirectly with respect to the Common Stock referred to in clause (i) above by way of stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization. As to any particular shares constituting Stockholder Shares, such shares shall cease to be Stockholder Shares when they have been (x) effectively registered under the Securities Act and disposed of in accordance with the registration statement covering them or (y) sold to the public through a broker, dealer or market maker on a securities exchange or in the over the counter market pursuant to Rule 144 (or any similar provision then in force) under the Securities Act.
          “ Stockholders ” has the meaning set forth in the preamble.
          “ Syufy Non-Competition Agreement ” has the meaning set forth in Section 1(e)(iv) .
          “ Syufy Enterprises ” means Syufy Enterprises, LP, a California limited partnership.
          “ Syufy Investor ” has the meaning set forth in the preamble.
          “ Syufy Nominee ” has the meaning set forth in Section 1(a)(iv) .
          “ Syufy Person ” has the meaning set forth in Section 1(e)(iv) .
          “ Transfer ” means any sale, transfer, assignment or other disposition of (whether with or without consideration and whether voluntary or involuntary or by operation of law) of Stockholder Shares.

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           “Western Hemisphere ” means the continents of North America, Central America and South America.
     6.  Amendment and Waiver . Except as otherwise provided herein, no modification, amendment or waiver of any provision of this Agreement shall be effective against the Company or any holder of Stockholder Shares unless such modification is approved in writing by the Company and each Major Investor. The failure of any party to enforce any of the provisions of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect the right of such party thereafter to enforce each and every provision of this Agreement in accordance with its terms.
     7.  Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of any other provision of this Agreement in such jurisdiction or affect the validity, legality or enforceability of any provision in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
     8.  Entire Agreement . Except as otherwise expressly set forth herein, this Agreement embodies the complete agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
     9.  Benefit of Parties; Transfer . This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors, legal representatives and Permitted Transferees. In the event of a Transfer by a Stockholder, the transferee shall not have the rights and powers of a Stockholder unless the transferee is a Permitted Transferee of the Stockholder prior to and following the Transfer. Nothing herein contained shall confer or is intended to confer on any third party or entity that is not a party to this Agreement any rights under this Agreement.
     10.  Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which taken together shall constitute one and the same agreement.
     11.  Remedies . The Company and the Stockholders shall be entitled to enforce their rights under this Agreement specifically, to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights existing in their favor. The parties hereto agree and acknowledge that a breach of this Agreement would cause irreparable harm and money damages would not be an adequate remedy for any such breach and that, in addition to other rights and remedies hereunder, the Company and the Stockholders shall be entitled to specific performance and/or injunctive or other equitable relief (without posting a bond or other security) from any court of law or equity of competent jurisdiction in order to enforce or prevent any violation of the provisions of this Agreement.

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     12.  Notices . Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, or mailed first class mail (postage prepaid, return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the Company at the addresses set forth below and to any applicable Stockholder at the address indicated on the schedules hereto. Notices shall be deemed to have been given hereunder when delivered personally, three days after deposit in the U.S. mail and one day after deposit with a reputable overnight courier service.
         
 
  The Company’s address is:   Cinemark Holdings, Inc.
 
      3900 Dallas Parkway, Suite 500
 
      Plano, Texas 75093
 
      Facsimile:     (972) 665-1004
 
      Attention:     Michael D. Cavalier
     13.  Governing Law . All issues and questions concerning the construction, validity, interpretation and enforceability of this Agreement and the exhibits and schedules hereto shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.
     14.  Business Days . If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or legal holiday in the state in which the Company’s chief executive office is located, the time period shall automatically be extended to the business day immediately following such Saturday, Sunday or legal holiday.
     15.  Descriptive Headings . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.
     16.  No Strict Construction . The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party.
     17.  Mutual Waiver of Jury Trial . The parties hereto hereby irrevocably waive any and all rights to trial by jury in any legal proceeding arising out of or related to this Agreement. Any action or proceeding whatsoever between the parties hereto relating to this Agreement shall be tried in a court of competent jurisdiction by a judge sitting without a jury.
[SIGNATURE PAGES FOLLOW]

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      IN WITNESS WHEREOF , the parties hereto have executed this Agreement on the day and year first above written.
             
    CINEMARK HOLDINGS, INC.
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
 
           
    MADISON DEARBORN CAPITAL
PARTNERS IV, L.P.
 
           
 
  By:   Madison Dearborn Partners, IV L.P.,
its General Partner
   
 
           
 
  By:   Madison Dearborn Partners, LLC,
its General Partner
   
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
 
           
    THE MITCHELL SPECIAL TRUST
 
           
 
  By:        
 
           
 
      Lee Roy Mitchell, Trustee    
 
  By:        
 
           
 
      Gary D. Witherspoon, Trustee    
Cinemark Holdings, Inc.
Signature Page to Director Nomination Agreement

 


 

             
    QUADRANGLE CAPITAL PARTNERS LP
 
           
 
  By:   Quadrangle GP Investors LP,
its General Partner
   
 
           
 
  By:   Quadrangle GP Investors, LLC,
its General Partner
   
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
 
           
    QUADRANGLE SELECT PARTNERS LP
 
           
 
  By:   Quadrangle GP Investors LP,
its General Partner
   
 
           
 
  By:   Quadrangle GP Investors, LLC,
its General Partner
   
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
 
           
    QUADRANGLE CAPITAL PARTNERS A LP
 
           
 
  By:   Quadrangle GP Investors LP,
its General Partner
   
 
           
 
  By:   Quadrangle GP Investors, LLC,
its General Partner
   
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Cinemark Holdings, Inc.
Signature Page to Director Nomination Agreement

 


 

             
    QUADRANGLE (CINEMARK) CAPITAL PARTNERS LP
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Cinemark Holdings, Inc.
Signature Page to Director Nomination Agreement

 


 

             
    SYUFY ENTERPRISES, LP
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Cinemark Holdings, Inc.
Signature Page to Director Nomination Agreement

 


 

             
    K&E INVESTMENT PARTNERS, LLC
- 2004-B DIF
 Lee Roy Mitchell    
 
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Alan Stock
           
 
           
    PIOLA INVESTMENTS LTD.
 
           
     
Timothy Warner
           
 
  By:        
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Robert Copple
           
 
           
     
    John Madigan
     
Michael Cavalier
           
         
 
           
NORTHWESTERN UNIVERSITY    
 
           
By:
       
 
       
Name:
       
 
       
Title:
       
 
       
Cinemark Holdings, Inc.
Signature Page to Director Nomination Agreement

 


 

SCHEDULE OF DIRECTORS
         
Name   Nominated as   Class of Director
Lee Roy Mitchell   Mitchell Nominee   III
Vacancy   Mitchell Nominee   II
Benjamin D. Chereskin   MDCP Nominee   III
James N. Perry, Jr.   MDCP Nominee   I
Robin P. Selati   MDCP Nominee   I
Vahe A. Dombalagian   MDCP Nominee   II
Enrique F. Senior   MDCP Nominee   I
Peter R. Ezersky   Quadrangle Nominee   II
Raymond W. Syufy   Syufy Nominee   III

 


 

SCHEDULE OF MITCHELL INVESTORS
         
    Number of Shares of Company
Name and Address   Common Stock
Lee Roy Mitchell
3900 Dallas Parkway, Suite 500
Plano, Texas 75093
    2,258,273  
 
       
The Mitchell Special Trust
3900 Dallas Parkway, Suite 500
Plano, Texas 75093
    2,169,713  
 
       
 
       
TOTAL
    4,427,986  

 


 

SCHEDULE OF MDCP INVESTORS
         
    Number of Shares of Company
Name and Address   Common Stock
Madison Dearborn Capital Partners IV, L.P.
Three First National Plaza
70 West Madison Street, Suite 3800
Chicago, Illinois 60602
    20,676,263  

 


 

SCHEDULE OF QUADRANGLE INVESTORS
         
    Number of Shares of Company
Name and Address   Common Stock
Quadrangle Capital Partners LP
c/o Quadrangle Capital Partners LLC
375 Park Avenue, 14 th Floor
New York, NY 10152
Attention: Kimberly Carlson
Facsimile: (212) 418-1783
    1,402,915  
 
       
Quadrangle Select Partners LP
c/o Quadrangle Capital Partners LLC
375 Park Avenue, 14 th Floor
New York, NY 10152
Attention: Kimberly Carlson
Facsimile: (212) 418-1783
    80,986  
 
       
Quadrangle (Cinemark) Capital Partners LP
c/o Quadrangle Capital Partners LLC
375 Park Avenue, 14 th Floor
New York, NY 10152
Attention: Kimberly Carlson
Facsimile: (212) 418-1783
    163,025  
 
       
Quadrangle Capital Partners A LP
c/o Quadrangle Capital Partners LLC
375 Park Avenue, 14 th Floor
New York, NY 10152
Attention: Kimberly Carlson
Facsimile: (212) 418-1783
    567,067  
 
   
 
       
TOTAL
    2,213,993  
NOTE: Notices sent to the Quadrangle Investors above shall also be copied to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
Attn: Phillip R. Mills
Fax: (212) 450-3800

 


 

SCHEDULE OF SYUFY INVESTOR
         
    Number of Shares of Company
Name and Address   Common Stock
Syufy Enterprises, LP
150 Pelican Way
San Rafael, CA 94901
Attn: Chief Executive Officer
Facsimile: (415) 448-8475
    3,388,466  
NOTE: Notices sent to the Syufy Investor above shall also be copied to:
Morrison & Foerster
425 Market Street
San Francisco, California 94105
Attn: John Campbell
Fax: (415) 268-7522

 


 

SCHEDULE OF ADDITIONAL INVESTORS
Lee Roy Mitchell
Alan Stock
Timothy Warner
Robert Copple
Michael Cavalier
Northwestern University
K&E Investment Partners, LLC — 2004-B DIF
Piola Investments Ltd.
John Madigan

 

 

(AKIN GUMP STRAUSS HAUER & FELD LLP HEADER)
Exhibit 5
April 18, 2007
Cinemark Holdings, Inc.
3900 Dallas Parkway
Suite 500
Plano, Texas 75093
     
Re:
  Cinemark Holdings, Inc. Registration Statement on Form S-1
 
  (Registration No. 333-140390)
Ladies and Gentlemen:
     We have acted as special counsel to Cinemark Holdings, Inc., a Delaware corporation (the “ Company ”), in connection with the registration, pursuant to a registration statement on Form S-1, as amended (the “ Registration Statement ”), filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “ Act ”), of the offering and sale by the Company of 13,888,889 shares (the “ Company Shares ”) of the Company’s common stock, par value $0.001 per share (“ Common Stock ”) , and the offering and sale by the selling stockholders listed in the Registration Statement (the “ Selling Stockholders ”) of up to 16,911,111 shares of Common Stock (the “ Selling Stockholder Shares ”) and sold pursuant to the terms of an underwriting agreement to be executed by the Company and Lehman Brothers, Inc. Credit Suisse Securities (USA) LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Morgan Stanley & Co. Incorporated. The Company Shares and the Selling Stockholder Shares are collectively referred to as the “ Shares .”
     We have examined originals or certified copies of such corporate records of the Company and other certificates and documents of officials of the Company, public officials and others as we have deemed appropriate for purposes of this letter. We have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals and the conformity to authentic original documents of all copies submitted to us as conformed and certified or reproduced copies.
     Based upon the foregoing and subject to the assumptions, exceptions, qualifications and limitations set forth hereinafter, we are of the opinion that (i) when the Registration Statement relating to the Company Shares has become effective under the Act, the terms of the sale of the Company Shares have been duly established in conformity with the Company’s certificate of incorporation and, when issued, sold and delivered as described in the Registration Statement, the Company Shares will be duly authorized and validly issued and are fully paid and non-assessable, and (ii) when the Registration Statement relating to the Selling Stockholder Shares has become effective under the Act, when sold and delivered as described in the Registration Statement, the Selling Stockholder Shares will be duly authorized and validly issued and are fully paid and non-assessable.
1700 Pacific Avenue, Suite 4100 / Dallas, Texas 75201-4675 / 214.969.2800 / fax: 214.969.4343 / akingump.com

 


 

(AKIN GUMP STRAUSS HAUER & FELD LLP HEADER)
Cinemark Holdings, Inc.
April 18, 2007
Page 2
     The opinions and other matters in this letter are qualified in their entirety and subject to the following:
A.   We express no opinion as to the laws of any jurisdiction other than any published constitutions, treaties, laws, rules or regulations or judicial or administrative decisions (“ Laws ”) of the Laws of the General Corporation Law of the State of Delaware .
     We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the Prospectus forming a part of the Registration Statement under the caption “Legal Matters.” In giving this consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Act and the rules and regulations thereunder. We also consent to your filing copies of this opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ Akin, Gump, Strauss, Hauer & Feld, L.L.P.
AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.
1700 Pacific Avenue, Suite 4100 / Dallas, Texas 75201-4675 / 214.969.2800 / fax: 214.969.4343 / akingump.com

 

 

EXHIBIT 10.10(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent/Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions Proration of Taxes
    6  
5.03 Omitted
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

i


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking—Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking—Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       
ii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  
iii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
        Page No.
Exhibit A
  Description of Premises   A-l
Exhibit B
  Site Plan of Premises   B-l
Exhibit C
  Form of Memorandum   C-l
Exhibit D
  Guaranty of Lease   D-l
iv

 


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
          Attached to this Lease and hereby made a part hereof are the following:
          EXHIBIT A — a description of the Entire Premises.
          EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red..
          EXHIBIT C — Form of Memorandum of Lease
          EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
          The following terms for purposes of this Lease shall have the meanings hereinafter specified:
          The term “Commencement Date” shall mean October 1, 1995.
          The term “Effective Date” shall mean October 1, 1995.
          The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
          The Term “Initial Rent Due Date” shall mean October 1, 1995.
          The term “Initial Term” is defined in Section 2.02 herein.
          The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

1


 

               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean *** successive separate periods of *** each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the Leased Premises.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate *** thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of*** each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted a non-exclusive easement for parking and ingress and egress on and over the Entire Premises. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use. Tenant shall be responsible for all costs related to the Entire Premises exclusive of Landlord’s Buildings.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of *** The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every *** after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the *** Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the *** Lease Year and on the first day of each *** Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco- Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than *** greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
     Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any other items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which are assessed on any Buildings exclusive of the Entire Premises, Tenant shall pay all such impositions. With respect to Impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election, Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be. In the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Leased Premises located on the Entire Premises.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’s buildings.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

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ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of Landlord’s Buildings), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (Landlord’s Buildings excluded), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood, but including Builders Risk, to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.

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     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively, they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cuared within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
By: /s/ Joseph Syufy
Print Name: Joseph Syufy
Title: V.P.
LANDLORD:
SYUFY ENTERPRISES
a California Limited Partnership
By: /s/ Raymond W. Syufy
Print Name: Raymond W. Syufy
Title: G.P.

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EXHIBIT 10.10(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located on Ethan Way in Sacramento, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***             of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
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imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
             
SYUFY ENTERPRISES, L.P.
      CENTURY THEATRES, INC.    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond W. Syufy
 
Raymond W. Syufy
      /s/ Joseph Syufy
 
Joseph Syufy
   
Chief Executive Officer
      President    
[STAMP]
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EXHIBIT 10.10(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment to Lease
      This Second Amendment to Lease (this “ Amendment ”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres , Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at Century Complex Sacramento, 1590 Ethan Way, Sacramento, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Renewal Option
     The “Option to Extend Lease Term” set forth in Section 2.03 of the Lease is hereby deleted in its entirety and replaced with the following:
     2.03 Option to Extend Lease Term .
  A)   Tenant may, at Tenant’s option, extend the Initial Term of this Lease for***      additional period of***      (the “ Renewal Term ”), subject to all the provisions of this Lease. The Renewal Term shall commence at the expiration of the Initial Term, and shall terminate on the*** of the date of commencement of the Renewal Term, unless sooner terminated as provided herein.
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  B)   Failure to duly exercise the option for the Renewal Term shall nullify the option.
 
  C)   Tenant’s right to the option to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
  (1)   This Lease being in full force and effect on the last day of the Initial Term.
 
  (2)   Compliance with the following procedure for exercising the option in question:
  (a)   At least nine (9) months before the last day of the Initial Term, Tenant shall give Landlord written notice exercising the option.
 
  (b)   Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If the option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
  (3)   Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
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     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “ FF&E ”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment
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or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
 
Raymond Syufy,
      /s/ Joseph Syufy
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
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EXHIBIT 10.10(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “ Amendment ”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”) and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at Century Complex Sacramento, 1590 Ethan Way, Sacramento, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
 
Raymond Syufy,
      /s/ Joseph Syufy
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
Century Stadium 14 Sacramento - Sacramento, California

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EXHIBIT 10.10(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Stadium 14, Sacramento)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P. , a California limited partnership (“Landlord”), and CENTURY THEATRES, INC. , a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises (“Original Landlord”)) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Sacramento, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE , for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3. Initial Term of Lease and Extension Options Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***      and rather than***       Renewal Terms of***      each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for***       consecutive Renewal Terms of***       each, followed by ***       additional and final Renewal Term of***
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Sacramento typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure, (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

 


 

     6.  Damage and Destruction – Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

 


 

not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:

 


 

     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;

 


 

  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12. Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 5 of this Amendment hereof.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without

 


 

limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
14.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
(i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
(ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
(iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Nonleased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food), a liquor store (other than first-class or upper-end wine and liquor store such as “BevMo”); a bulk candy store, (other than upperend candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.

 


 

  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     16.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     17.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     18.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease,

 


 

including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     19.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     20.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either

 


 

party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
         
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.

 


 

         
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
     Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     21.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     22.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio - it being the intent of the parties hereto that this Amendment shall supercede such Second Amendment and Third Amendment in their entirety.
     23.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord;
SYUFY ENTERPRISES L.P., a California limited partnership
             
 
  By:
Name:
  /s/ Joseph Syufy
 
Joseph Syufy
   
 
  Title:   President, Syufy Properties, Inc., General Partner    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:
Name:
  /s/ Raymond W. Syufy
 
Raymond W. Syufy,
   
 
  Title:   Chairman    

 

 

EXHIBIT 10.11(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Co-tenancy
       
2.01 Lease of Premises
    3  
2.02 Term of Lease
    3  
2.03 Option to Extend Lease Term
    4  
2.04 Covenant of Title
    4  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    5  
 
       
ARTICLE IV: Rent
       
4.01 Annual Fixed Rent
    6  
4.02 Percentage Rent
    6  
4.03 Rent Payments
    7  
4.04 Place for Payment of Rent
    7  
4.05 Late Payment of Rent
    7  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    8  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions
    8  
5.03 Contest of Taxes
    9  
5.04 Utilities
    9  
5.05 Personal Property Taxes
    9  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    9  
6.02 Types of Required Insurance
    9  
6.03 Terms of Insurance
    10  
6.04 Landlord’s Acquisition of Insurance
    11  
6.05 Insurance Money and Other Funds Held In Trust
    11  
6.06 Application or Proceeds of Physical Damage Insurance
    11  

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Table of Contents
         
    Page No.  
6.07 Cooperation for Insurance Proceeds
    12  
6.08 Waiver of Right of Recovery
    12  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    13  
7.02 Repairs — Maintenance
    13  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    14  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    14  
8.03 Remedial Work
    16  
8.04 Maintenance of Premises
    17  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    17  
8.06 Landlord Inspection
    18  
8.07 Effect of Termination
    18  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant Improvements
    19  
9.02 Hold Harmless
    19  
9.03 Permits, Compliance With Codes
    19  
9.04 Ownership of Improvements
    19  
9.05 Control
    20  
 
       
ARTICLE X: Indemnity
       
10.01 Landlord’s Indemnity
    20  
10.02 Tenant’s Indemnity
    20  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    21  
11.02 Notice to Landlord
    21  
 
       
ARTICLE XII: Mortgage Subordination
       
12.01 Existing Mortgages
    21  
12.02 Future Mortgages
    21  
 
       
ARTICLE XIII: Condemnation — Eminent Domain
       

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LEASE
Table of Contents
         
    Page No.  
13.01 Definitions
    22  
13.02 Notice to Other Party
    23  
13.03 Total Taking — Effect on Rent and Term
    23  
13.04 Distribution of Award for Taking
    23  
13.05 Partial Taking — Rent Adjustments
    23  
13.06 Partial Taking — Option to Terminate
    23  
13.07 Separate Tenant’s Award
    24  
 
       
ARTICLE XIV: Default
       
14.01 Tenant’s Default
    24  
14.02 Landlord’s Remedies Cumulative
    24  
14.03 Landlord’s Default
    26  
14.04 Waiver of Redemption
    26  
14.05 Dispute Resolution
    26  
14.06 Attorney Fees
    27  
 
       
ARTICLE XV: Representations and Warranties
       
15.01 Landlord’s Representations and Warranties
    27  
15.02 Tenant’s Representations and Warranties
    28  
 
       
ARTICLE XVI: Damage or Destruction
       
16.01 Repairs, Alterations and Further Improvements
    28  
16.02 Prompt Repair
    30  
16.03 Rent Adjustment
    30  
16.04 Damage During Last Ten (10) Years of Term
    30  
 
       
ARTICLE XVII: Miscellaneous
       
17.01 Limitation on Liability
    30  
17.02 Brokers
    30  
17.03 Modification
    31  
17.04 Severability
    31  
17.05 Governing Law
    31  
17.06 Terminology
    31  
17.07 Counterparts
    31  
17.08 Binding Effect
    31  
17.09 Captions
    31  

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LEASE
Table of Contents
         
    Page No.  
17.10 Notice to Landlord and Tenant
    31  
17.11 Addresses for Notices to Landlord and Tenant
    32  
17.12 Entire Agreement
    32  
17.13 Sale or Transfer of Premises
    33  
17.14 Force Majeure
    33  
17.15 Waiver
    33  
17.16 Estoppel Certificate
    33  
17.17 Number and Gender
    34  
17.18 No Holding Over
    34  
17.19 Mechanics Liens
    34  
17.20 Relationship of Parties
    34  
17.21 Time of the Essence
    34  
17.22 Facsimile Copies
    34  
17.23 Anti-Merger
    34  
Signature Page
     
Exhibit A
  A Description of Entire Premises
Exhibit B
  A Site Plan of Entire Premises
Exhibit C
  Form of Memorandum of Lease
Exhibit D
  Guaranty of Lease

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LEASE
     THIS INDENTURE OF LEASE, dated as of December 1,1995, by and between Syufy Enterprises, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, CA, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in a parcel of land described on Exhibit A attached hereto.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
          Attached to this Lease and hereby made a part hereof are the following:
          EXHIBIT A — a description of the tract of land hereinafter referred to as “Entire Premises”.
          EXHIBIT B — a site plan of the Entire Premises showing (i) the location of the Tenant’s Building, outlined in red.
          EXHIBIT C — Form of Memorandum of Lease
          EXHIBIT D — Guaranty of Lease.
     1.02. Definitions.
          The following terms for purposes of this Lease shall have the meanings hereinafter specified:
          The term “Commencement Date” shall mean July 1, 1996.

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          The term “Common Facilities” or “Common Areas” shall include the parking areas, streets, driveways, curb cuts, access facilities, aisles, sidewalks, malls, landscaped areas, and other common and service areas within the Entire Premises with the improvements thereon, whether or not shown on Exhibit B.
          The term “Effective Date” shall mean December 1, 1995.
          The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
          The term “Entire Premises” shall mean the tract of land described on Exhibit B.
          The Term “Initial Rent Due Date” shall mean July 1, 1996.
          The term “Initial Term” is defined in Section 2.02 herein.
          The term “Leased Premises” or “Premises” shall mean Tenant’s Building outlined in red on Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
          The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
          The term “Number of Tenant Working Days” shall mean 365 days.
          The term “Number of Term Years” shall mean***          
          The term “Option Periods” shall mean ***          successive separate periods of *** each.
          The term “Percentage Rate” shall mean ***          
          The term “Planned Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
          The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime

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Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
          The term “Tenant’s Building” shall mean the building to be erected by Tenant at Tenant’s sole cost.
          The term “term of this Lease” or “term hereof shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date.
          D) During the Lease Term, Landlord grants to Tenant and its employees, agents, customers and other invitees a non-exclusive easement for free parking and ingress and egress on and over the Entire Premises for Tenant, Tenant’s employees, agents, contractors, customers and invitees. Tenant shall be responsible for all costs associated with the Entire Premises exclusive of any Landlord’s Buildings that may be constructed thereon. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use.
     2.02 Term of Lease.
               Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate***           thereafter and shall terminate on the last day of the calendar month during which the date which is***           after the Commencement Date occurs. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***          consecutive additional periods of ***           each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***           of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default (meaning the breach of any obligation hereunder and failure to cure that breach within the time permitted in Section 14.01) at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple.

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               (B) Landlord shall give Tenant prior written notice before commencing any work upon the Entire Premises, and shall cause all work to be performed by Landlord to be conducted in such a manner that does not unreasonably interfere with Tenant’s customers or its business operations. Tenant shall give Landlord prior written notice before commencing any work upon the Premises, and shall cause all work to be performed by Tenant to be conducted in such a manner that the same does not unreasonably interfere with the other tenant’s customers or their business operations.
               (C) “Exterior Common Facilities” shall consist of all driveways, parking areas, utilities and utility lines, service areas, including loading and unloading areas, landscape areas, if any, lighting facilities and equipment, and any and all other exterior facilities upon or below the Entire Premises designed for use by or benefit of the occupants of the Entire Premises.,
               (D) Maintenance of Entire Premises At all times during the Term, Tenant shall keep and maintain the Exterior Common Facilities in the Entire Premises and Tenant’s Building in good order and repair and in a clean and safe condition, reasonably free of debris. The lighting for the Exterior Common Facilities shall be turned on by Tenant on each day that business is conducted on the Premises at or about the same time that the municipality turns on street lights, and same shall be kept lighted for one (1) hour after all Tenants close for business. Tenant’s obligation hereunder shall included maintaining the parking areas of the Entire Premises free of potholes and assuring that they are properly coated and sealed and striped as needed. Tenant shall make any and all additions to and all alterations and repairs in, on and about the Exterior Common Facilities, which may be required by, and shall otherwise observe and comply with, all public laws, ordinances and regulations from time to time applicable to the Exterior Common Facilities. Tenant shall indemnify and save harmless Landlord from and against all actions, claims and damages by reason of Tenant’s failure to comply with and perform its obligations under this section.
               (E) Tenant’s Liens Tenant will not permit the Entire Premises to become subject to any mechanics’, laborers’ or materialmen’s lien on account of labor or material furnished to Tenant or claimed to have been furnished to Tenant in connection with work of any character performed or claimed to have been performed on the Entire Premises by or at the direction or sufferance of Tenant; provided, however, Tenant shall have the right to contest in good faith and with reasonable diligence the validity of any such lien or claimed lien and on final determination of the lien or claim for the lien, Tenant will immediately pay any judgment rendered with all proper costs and charges, and will, at its own expense, have the lien released and any judgment satisfied.
ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Planned Use no other purpose.

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          B) Landlord shall agree and consent to such utility and other easements encumbering the Premises or benefiting the Premises and encumbering the Fee Parcels and/or the Leasehold Parcel as Tenant may reasonably require for its use and occupancy of the Premises.
          C) Landlord agrees that no use of the Entire Premises shall be permitted which is inconsistent with the operation of the Planned Use. Landlord further agrees not to permit or allow any portion of the Entire Premises to be used by any other tenant, subtenant, licensee, or occupant (including Landlord) for the exhibition of commercial movies or as a commercial movie theater complex.
ARTICLE IV
RENT
     4.01 Annual Fixed Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term Annual Fixed Rent in the amount of***           . The Annual Fixed Rent shall be payable in advance in twelve (12) equal monthly installments. The Annual Fixed Rent shall be subject to adjustment every***           after the Initial Rent Due Date as set forth in Section 4.01 (B) below.
          B) The Annual Fixed Rent shall apply from the Rent Commencement Date through the end of the***      Lease Year of the Term. The Annual Fixed Rent shall be increased (but never decreased) on the first day of the ***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for all Urban Consumers, Sacramento, Subgroup “All Items”, (1982-84+100) (the Consumers Price Index”; provided however, in no event shall the Annual Fixed Rent be increased by an amount that is less than ***      greater than the Annual Fixed Rent payable before the adjustment date in question.
               In the event that the Consumer Price Index is not available, the successor or substitute index, shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent.
          In addition to the payment of Annual Fixed Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      of the Gross Sales for such Lease Year exceeds the Annual Fixed Rent which is payable for such Lease

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Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross sales and the annual fixed rate percentage for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Annual Fixed Rate and Gross Sales for the first Lease Year.
          Gross Sales shall mean all box office receipts, and receipts from sales of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant and returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions”. Commissions paid to agencies or other third parties for selling tickets and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.

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ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay when due all Impositions (exclusive of Landlord’s Buildings, if any) assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises (exclusive of Landlord’s Buildings, if any).. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
          B) In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          C) Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against Landlord’s Buildings, if any.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the

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taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.03 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.03. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.03.
     5.04 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities consumed on the Entire Premises exclusive of Landlord’s Buildings, if any. Any utility improvements presently serving the Entire Premises shall be maintained, repaired and replaced by Tenant, at Tenant’s expense.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:

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          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises, Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) as well as any and all improvements on the Common Area and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) including Builder’s Risk but excluding earthquake and flood to the extent of not less than 100% of the full replacement cost thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Upon written request, Tenant shall name Landlord and any parties requested by Landlord and the holder of the first mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Tenant in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.

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          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or proceeds received by the Tenant and/or Landlord shall be held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and Second, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVI hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Tenant and Landlord shall apply the proceeds of the insurance collected to the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Tenant and Landlord by the licensed architect or engineer in charge of the work. Any amounts payable to Tenant or any Affiliate of Tenant for work or services performed or materials provided as part of any such repair, replacement, restoration or rebuilding shall not exceed competitive rates for such services or materials and Tenant shall, upon request of Landlord, make available to Landlord and its representatives all books and records of Tenant relating to such work, services and materials. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Tenant or Landlord with respect to the damage or destruction involved, and not used, shall be and remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Tenant and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:

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               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unleasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.

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ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained, which approval shall not be unreasonably withheld.
          B) Tenant shall at all times keep the Entire Premises, Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          C) Upon termination of this Lease, Tenant may, at its option, remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance.
          A) Tenant shall, at its sole cost and expense, maintain and repair the Entire Premises and Tenant’s Building and all improvements on the Entire Premises exclusive of Landlord’s Buildings if any and including all exterior lighting and signs.
          B) Tenant shall also be responsible for any losses or damages resulting to Landlord’s Buildings, if any. from any materials, substances or liquids which are leaked or discharged from any area outside Landlord’s Buildings, if any, unless such leakage or discharge is caused by Landlord or Landlord’s agents or employees.
          Tenant shall commence all of the repairs and maintenance within 3 days after receiving notice thereof from Landlord (provided that in the case of an emergency Tenant shall commence such work immediately upon receiving notice) and shall be diligently completed in a good and workmanlike manner. Notwithstanding the foregoing, Landlord shall have the right and option (but not the obligation) to undertake any such repair, maintenance or other items, in which event Tenant shall reimburse Landlord for all of the costs thereof within 30 days after Landlord’s request therefor. If Tenant fails to reimburse Landlord within the 30 day period, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum until such payment has been made.

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ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought

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upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property

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wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and

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payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Landlord’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees,

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beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate often percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.

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          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant Improvements. Tenant at its sole cost and expense shall complete all the required on-site and off-site improvements, including all signs, required for the development of the Entire Premises. In addition Tenant shall construct a motion picture theater building on the Premises containing approximately sixty thousand (60,000) square feet with sixteen auditoriums. Landlord will provide Tenant with a site and building allowance of $4,992,180.00. The site and building allowance will be paid by Landlord to Tenant the latter of July 1, 1996 or the date Tenant opens to the public for business.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of by Tenant of Tenant’s Building or Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership of Improvements.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and

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improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein excluding moveable trade fixtures and personal property of Tenant, shall become the property of Landlord, unless and to the extent Tenant elects to remove any of the foregoing pursuant to Section 9.04 (B).
          B) Tenant shall have the right to remove all trade fixtures, equipment and furnishings, including seats, carpets, draperies, screen, sound reproducing equipment, projection equipment, furniture and lobby frames from the Premises without notice to Landlord and the foregoing shall remain the property of the Tenant at the expiration or earlier termination of the Lease. In addition, Tenant shall have the right if Tenant so elects by giving written notice to Landlord of such election at any time before ninety (90) days prior to the end of the Term (including any renewals or extensions) hereof to remove any other Improvements and all additions, alterations and improvements thereto or replacements thereof erected, constructed, or installed on the Premises. The removal of any of the foregoing shall be completed within thirty (30) days following the end of the Term hereof (including any renewals thereof or any earlier termination permitted by this Lease.
     9.07 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Landlord’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Tenant, its agents, employees, licensees, invitees or contractors on the Leased Premises, occurring within the Leased Premises or (ii) arising from Tenant’s or its employees use of the Leased Premises.
     10.02 Tenant’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Tenant and its agents, employees, tenants, licensees and contractors, Landlord shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant (and its successors, assigns and subletees), and all of their directors, officers, employees and agents, hereinafter referred to as “Tenant Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Landlord, its agents, employees, licensees, invitees on the Entire Premises or contractors, occurring within the Entire Premises, or (ii) arising from Landlord’s use of the Entire Premises.

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ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease. Landlord shall be entitled to all rent from any assignment or sublease in excess of the Annual Fixed Rent set forth in this Lease.
          B) Any assignment of this Lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without Landlord’s consent, assign this Lease (a) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (b) to Tenant’s Parent Corporation, or (e) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, provided that such corporation duly and validly then guarantees the performance of the obligations under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord in writing of any assignment of the Lease ten (10) days prior to such event.
ARTICLE XII
MORTGAGE SUBORDINATION
     12.01 Existing Mortgages. If there is an existing mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises or in any other part of the Entire Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     12.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises

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in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIII
CONDEMNATION — EMINENT DOMAIN
     13.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Entire Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.

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     13.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     13.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     13.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any for the Fair Market Value of all Land, buildings and other improvements on the Entire Premises and all Severance Damages.
          B) To Tenant, the amount awarded, if any, for loss of goodwill, lost business, lost profits, relocation expenses and fixtures; and
          C) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 13.04 out of amounts awarded by the governmental body taking the Premises.
     13.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises or the parking taken bears to the total area of the Premises or the parking.
     13 06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty-three percent (33%) of the Building or thirty-three (33%) of the parking is taken by condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice

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of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     13.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses, fixtures and relocation expenses against the acquiring governmental Agency.
ARTICLE XIV
DEFAULT
     14.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Fixed Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
     14.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively, they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a

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receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 14.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 14.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 14.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.

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          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 14.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 14.02(C), Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 14.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     14.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord. Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     14.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     14.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 14.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective,

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Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party, which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. Arbitration shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association.
     14.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XV
REPRESENTATIONS AND WARRANTIES
     15.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.

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          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     15.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVI
DAMAGE OR DESTRUCTION
     16.01 Repairs. Alterations and Further Improvements.

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          A) Tenant’s Obligation to Repair. In the event of damage to or destruction of the Tenant’s Building or any Improvements on or to the Premises to be covered by the insurance described in Article 6:
               (1) Damages of Less Than Fifty Percent (50%) of Replacement Cost. If the cost of repairing or reconstructing the Tenant’s Building or Improvements to the condition and form prior to such damage or destruction is not in excess of Fifty percent (50%) of the then new replacement cost of the Improvements and such repairs or reconstruction of any such damage or destruction can be made under then existing laws, ordinances, statutes or regulations of any governmental authorities applicable thereto (or can be so made with minor and non-material changes to the former condition and form of property damaged or destroyed), Tenant shall effect, and Landlord and Tenant agree that the funds derived from insurance acquired pursuant to Article 6 shall be made available to effect, such repair and reconstruction of the structure or improvement so damaged or destroyed to substantially its condition prior to said damage or destruction with such alterations thereto as Tenant shall reasonably determine prudent or valuable under the circumstances, including any changes required to comply with applicable law, with the then prevailing construction practices applicable to the Premises. Tenant shall be responsible for all costs in excess of Insurance proceeds available All such work shall be carried on in accordance with Drawings prepared by a licensed architect or architects approved by Landlord (acting reasonably) if such an architect is reasonably required, given the scope and nature of the work. In disbursing insurance proceeds the Tenant and Landlord may rely upon and accept the certified determinations of such architect with respect to estimated costs, awarding of contracts, sufficiency of bonds, progress of construction, interpretation of plans and specifications, compliance with same, and completion of construction. No extras or changes in Drawings shall be made by Tenant without first giving written notice of such changes to Landlord and obtaining Landlord’s approval thereof (which approval shall not be unreasonably withheld or delayed).
               (2) Damage in Excess of Fifty Percent (50%) . If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of the Fifty percent (50%) provided in subparagraph (A)(1) of this Section 16.01, or if such cost is less than Fifty percent (50%), but such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto (and cannot be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), and, in any such event, the parties hereto are unable during a period of ninety (90) days after the determination by Tenant with respect to such damage or destruction to agree in writing on a construction program, then, at Tenant’s sole option, the Term shall end as of the date of such damage or destruction, provided that Tenant notifies Landlord of its election to exercise such termination option within such ninety (90) day period. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), but the cost of so repairing or reconstructing such damage or destruction is in excess of the Fifty percent (50%) provided for in subparagraph (A)(1) of this Section 16.01, Tenant shall have the absolute right to treat such damage as under subparagraph (A)(1) of this Section 16.01 as if the damage or destruction met the description thereof set forth in the first sentence of that Section if Tenant (i) gives

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notice to the effect to Landlord within such ninety (90) days period after Tenant’s determination with respect to said damage or destruction; and (ii) promptly demonstrates to the reasonable satisfaction of any Leasehold Mortgagee (if any) that it can provide the funds required or that will be required under the provisions of subparagraph (A)(1) of this Section 16.01 to effect such repair or restoration, whereupon the provisions of said subparagraph (A) of this Section 16.01 shall be fully applicable to such damage or destruction.
     16.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated or elects to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided and subject to the provisions of subparagraph (B) of Section 16.01), and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     16.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall thereafter not abate but continue for as long as and to the extent such Improvements are untenantable.
     16.04 Damage During Last Two (2) Years of Term. If there occurs during the last ten (10) years of the Initial Term or at any time during a Renewal Period damage or destruction to any Improvement on or in the Premises and the costs of repairing, restoring, replacing or rebuilding the same exceed Five Thousand Dollars ($500,000), then Tenant may elect to terminate the Term and, in such event, Tenant shall give notice to Landlord of its election within sixty (60) days after its determination of the amount of damage, and the Term shall thereupon terminate as of the date of such notice.
ARTICLE XVII
MISCELLANEOUS
     17.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Entire Premises and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Entire Premises.
     17.02 Brokers. Landlord and Tenant each represent to the other that neither has any obligation to any broker or finder in connection with this transaction, and that no fee or commission is due any broker, finder, or similar person in connection herewith. Landlord and Tenant each indemnifies the

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other and agrees to hold the other harmless from and against any and all claims, demands, liabilities, lawsuits, costs, and expenses (including reasonable attorneys’ fees) for any fee or commission due to any other broker, finder, or similar person in connection with this transaction and arising out of the act of the indemnifying party.
     17.03 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     17.04 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     17.05 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     17.06 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     17.07 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     17.08 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     17.09 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     17.10 Notices to Landlord and Tenant
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 17.11 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 17.11 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     17.11 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Real Estate Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     17.12 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.

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     17.13 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     17.14 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     17.15 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     17.16 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party

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failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     17.17 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     17.18 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     17.19 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     17.20 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     17.21 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     17.22 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     17.23 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or

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          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
             
         Executed as of the date first written above.    
 
           
TENANT:
           
    CENTURY THEATRES OF CALIFORNIA, INC.,
a California corporation
   
 
           
 
  By:
Print Name:
  /s/ Joseph Syufy
 
Joseph Syufy
   
 
  Title:   Senior Exec. VP    
 
           
LANDLORD:
           
 
           
    SYUFY ENTERPRISES, a
California Limited Partnership
   
 
           
 
  By:
Print Name:
  /s/ Raymond W. Syufy
 
Raymond W. Syufy
   
 
  Title:   President    

35

 

EXHIBIT 10.11(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated December 1, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Elk Grove, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Sacramento” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***           of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Elk Grove, CA

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Surrender
     After the first sentence of Section 14.02(E), the following sentence is hereby inserted:
     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
Elk Grove, CA

 


 

     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
             
SYUFY ENTERPRISES, L.P.
      CENTURY THEATRES, INC.    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond W. Syufy
      /s/ Joseph Syufy    
 
Raymond W. Syufy
     
 
Joseph Syufy
   
Chief Executive Officer
      President   [STAMP]
Elk Grove, CA

 

 

EXHIBIT 10.11(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”) and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas , Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated December 1, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at Red Elk Drive and Big Horn Boulevard, Laguna, County of Sacramento, California and known as Century Laguna 16; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01 (a) of the Lease, the following is hereby inserted:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “ Development ”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or impede Tenant’s access to the Premises other than as expressly set forth herein. In addition to developing some or all of the Entire Premises that are outside of the
Century Laguna 16 — Laguna, California

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Building, Landlord’s Development rights set forth above shall include the rights to develop and lease at least one (1) pad for retail purposes substantially as shown on Exhibit A attached hereto (the “Retail Pad”) and all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, (a) Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use and (b) in the event that Landlord develops and leases the Retail Pad, at Landlord’s option, Tenant shall enter into a reciprocal parking agreement granting Landlord and the Retail Pad tenant(s) nonexclusive access to and use, without charge or restriction, of the parking areas serving the Premises and described in the Lease. Notwithstanding the foregoing, Landlord and Tenant agree that in connection with the Development, Landlord may, among other things, require Tenant to remove up to two hundred (200) theatre seats from the Premises (the “Agreed Upon Reduction”) in order to accommodate the parking requirements of both Tenants’ use of the Premises and the Development, as such parking requirements are reasonably determined by Landlord. In no event shall Tenant be entitled to an abatement of Rent or consideration of any kind in connection with the Agreed Upon Reduction.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the
Century Laguna 16 — Laguna, California

2


 

Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century Laguna 16 — Laguna, California

3


 

      In Witness Whereof , Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P .,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
     
 
   
Raymond Syufy
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century Laguna 16 — Laguna, California

4

 

EXHIBIT 10.11(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Enterprises, L,P., a California limited partnership (“ Landlord ”) and Century Theatres, inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated December 1, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “Premises”) located at Red Elk Drive and Big Horn Boulevard, Laguna, County of Sacramento, California and known as Century Laguna 16; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE) ”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas , Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
Century Laguna 16 — Laguna, California

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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
 
Raymond Syufy,
     
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
Century Laguna 16 — Laguna, California

2

 

EXHIBIT 10.11(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Laguna)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres of California, Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of December 1, 1995 (the “Original Lease”), for certain premises located in Laguna, Elk Grove, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”) and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***           and rather than ***          Renewal Terms of ***           each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***           consecutive Renewal Terms of ***          each, followed by ***          additional and final Renewal Term of***          .
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Sacramento typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.

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     6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in subsection (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     9.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:

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  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant.
          Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
          Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theatre complex. Tenant shall be required to complete all alterations, improvements and changes undertaken by Tenant. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.

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     13.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end

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      wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     16.  No Obligation To Continuously Operate. Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     17.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.

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     18.  ***      Rent Conversion and Early Termination.
     (a) As of the Effective Date hereof, the parties have been made aware of the possibility that a new motion picture theatre complex may be developed and operated in the *** located in South Sacramento, California (the “Nearby Theatre”).
     (b) If the Nearby Theatre opens for business and thereafter during any consecutive twelve (12) calendar month period (the “First Test Period”), the Theatre Level Cash Flow (“TLCF”), as defined in Exhibit “A-3” hereto, for the Leased Premises over such First Test Period is less than ***, then upon notice from Tenant to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Test Period, the ***     Rent Conversion (defined below) will become effective; provided , however, that such notice and Tenant’s right pursuant to the ***      Rent Conversion as provided in this subparagraph (b) shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined in Section 3 above) throughout the First Test Period. In order to be effective, Tenant’s notice to Landlord under this subparagraph (b) shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the First Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then effective as of the first day of the first calendar month following Landlord’s receipt of Tenant’s notice as provided above and thereafter so long as Tenant continues to satisfy the Operating Condition, in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of Impositions or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease) Tenant shall pay to Landlord on a monthly basis an amount equal to ***     of Tenant’s Gross Sales, as defined in Section 10 above (the “***      Rent Conversion”). Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the applicable period, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     (c) (i) If the***      Rent Conversion occurs and thereafter during any consecutive twelve (12) calendar month period (the “Second Test Period”), the TLCF for the Leased Premises is less than ***, then Tenant shall have the right to be exercised by written notice to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Second Test Period, to terminate the Lease as provided below in this subparagraph (c); provided , however , that such notice and Tenant’s right to terminate the Lease as provided in this subparagraph (c) shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined above) continuously throughout the Second Test Period. In order to be effective, Tenant’s notice to Landlord under this subparagraph (c) shall include a written certification to Landlord from Tenant’s chief financial officer or controller that the TLCF for the Second Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the expiration of the termination notice.

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     (ii) If the***      Rent Conversion occurs, and if at anytime thereafter, Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased Premises in excess of *** which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that (1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 18(d) below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 18(d) below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
Notwithstanding anything to the contrary set forth in the Lease, including Section 16 above, if Tenant elects to terminate this Lease pursuant to this Section 17 and Landlord demolishes the theatre building of the Leased Premise within twelve (12) months after the date of termination, then Tenant shall reimburse Landlord for the actual out-of-pocket costs incurred by Landlord to demolish the theatre building (including, without limitation, the costs to remove from the Leased Premises all building materials and debris and all footings, foundations, utility lines and other underground installations that serve the Leased Premises and the costs to restore the surface of the Premises to a graded and landscaped surface); provided, however, that Tenant’s reimbursement obligations shall not exceed an amount equal to the product of *** psf multiplied by the ground floor area of the theatre building (in square feet). Tenant shall pay the amount due under this paragraph within thirty (30) days after receiving Landlord’s written demand for reimbursement, which shall include reasonable supporting documentation confirming the costs so incurred by Landlord. Tenant’s obligations under this paragraph shall expressly survive the termination of the Lease.
     (d) If the***      Rent Conversion occurs, then Landlord shall have the right at anytime thereafter to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.

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     19.  California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     20.  Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”

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     21.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       

12


 

         
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     22.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     23.  Prior Amendments. All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. Paragraph B concerning Surrender in the Second Amendment is hereby deleted in its entirety and of no further force and effect. The Third Amendment is hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Third Amendment in its entirety.
     24.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.

13


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond W. Syufy    
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
 A3-1 

 

EXHIBIT 10.12(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent /Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions Proration of Taxes
    6  
5.03 Omitted
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

iii


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Exhibit A            Description of Premises
    A-l  
Exhibit B            Site Plan of Premises
    B-l  
Exhibit C            Form of Memorandum
    C-l  
Exhibit D            Guaranty of Lease
    D-l  

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Entire Premises.
               EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red..
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
      1.02. Definitions .
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

1


 

               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean***      successive separate periods of ***      each.
               The term “Percentage Rate” shall mean***
               The term “Premises” shall mean the Leased Premises.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises .
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease .
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***        thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term .
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to***      consecutive additional periods of***      each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***       of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                         (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                         (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title .
                         (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted a non-exclusive easement for parking and ingress and egress on and over the Leased Premises. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***      The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***      Lease Year and on the first day of each***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco- Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***       greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent . In addition to the payment of Base Rent. Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments . Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent . The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions .
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any other items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which are assessed on any Buildings exclusive of the Entire Premises, Tenant shall pay all such impositions. With respect to impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election, Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other properly or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be. In the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Leased Premises located on the Entire Premises.
     5.04 Contest of Taxes . Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’s buildings.
     5.06 Personal Property Taxes . During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

6


 

ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies . Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance . Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance . Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of Landlord’s Buildings), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance . During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (Landlord’s Buildings excluded), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance . The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “ A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.

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     6.04 Landlord’s Acquisition of Insurance . If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance . In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds . At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds . Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery . Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes .
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance . Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition . For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity .
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work . In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises .
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity .
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection . Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not Limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination .
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs .
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless . Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
9.04 Ownership.
     A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
     B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control . Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification . Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting .
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord . Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages .
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages . If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions . The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party . The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term . On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking . On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments . On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate . Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default . The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative . Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance . Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination . Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession . No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions . As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender . Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver . If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption . Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute . The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation . A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration . With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to § 1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
     15.06 Attorneys’ Fees . Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties . Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties . Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a parry.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements .
          A) Tenant’s Obligation to Repair . If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%) . If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair . If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other properly as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability . The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability . In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law . This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology . All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa, “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions . Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant .
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn: Real Estate Department
 
   
 
   
To Tenant:
  Century Theatres of California, Inc.
 
  150 Golden Gate Avenue
 
  San Francisco, CA 94102
 
  Attention: Legal Department
 
   
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises . Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure . In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate . Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender . Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens . Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties . Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence . Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies . Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger . The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
             
TENANT:
           
 
           
    CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
   
 
           
 
  By:   /s/ Joseph Syufy    
 
           
    Print Name: Joseph Syufy    
    Title: V.P.    
 
           
LANDLORD:
           
 
           
    SYUFY ENTERPRISES
a California Limited Partnership
   
 
           
 
  By:   /s/ Raymond W. Syufy    
 
           
    Print Name: Raymond W. Syufy    
    Title: G.P.    

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EXHIBIT 10.12(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located on Hillcap Avenue in San Jose, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***     of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
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imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01 (C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01 (B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
“Landlord”
  CENTURY THEATRES, INC.
“Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
 
   
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
(STAMP)
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EXHIBIT 10.12(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and Century Theatres , Inc., a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Century Capitol, 3690 Hillcap Avenue, San Jose, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”) , succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore , the parties hereto mutually agree that the Lease shall be amended as follows:
A. Deletion of Renewal Option
     The “Option to Extend Lease Term” set forth in Section 2.03 of the Lease is hereby deleted in its entirety and replaced with the following:
2.03 Option to Extend Lease Term .
  A)   Tenant may, at Tenant’s option, extend the Initial Term of this Lease for***              additional period of***              (the “Renewal Term” ), subject to all the provisions of this Lease. The Renewal Term shall commence at the expiration of the Initial Term, and shall terminate on the *** of the date of commencement of the Renewal Term, unless sooner terminated as provided herein.
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  B)   Failure to duly exercise the option for the Renewal Term shall nullify the option.
  C)   Tenant’s right to the option to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
  (1)   This Lease being in full force and effect on the last day of the Initial Term.
 
  (2)   Compliance with the following procedure for exercising the option:
  (a)   At least nine (9) months before the last day of the Initial Term, Tenant shall give Landlord written notice exercising the option.
 
  (b)   Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option has been exercised. If the option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
  (3)   Tenant is not in default at time of the exercise of the renewal and at the commencement of the Renewal Term.
B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01 (a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for
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any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
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     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership “Landlord”
  a California corporation “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
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EXHIBIT 10.12(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres, Inc., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises”) located at Century Capitol, 3690 Hillcap Avenue, San Jose, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”) , succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now , Therefore , the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership “Landlord”
  a California corporation “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
Capitol 16 — San Jose, California

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EXHIBIT 10.12(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Capitol City, SJ)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS:
     A. Landlord (then known as Syufy Enterprises (the “Original Landlord”) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in San Jose, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease, the current Term of the Lease shall expire on the date that is ***

 


 

after the Effective Date hereof. Thereafter, the Term of this Lease shall automatically renew on a ***                basis unless Tenant delivers written notice to Landlord at least sixty (60) days prior to the then-current expiration date of the Term that Tenant elects not to extend the Term of the Lease.
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Santa Clara typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty); provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the
so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.
     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:

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          (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
          (B) If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the uninsured cost to repair such damage or to restore the Leased Premises (including deductibles) exceeds $50,000, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises (provided, however, that Landlord may nullify Tenant’s election not to undertake the repairs and restoration, within thirty (30) days after receiving Tenant’s notice by confirming either (x) that Landlord shall reimburse Tenant for such excess costs within 30 days after the completion of the repairs and restoration and Landlord’s receipt of reasonable supporting documentation of such costs or (y) that Landlord waives its right to terminate this Lease pursuant to Section 18 prior to the date which is 12 months after the repairs and restoration are completed), and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
      7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.

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No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l” .
     9.  [Intentionally Omitted]
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and

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other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant .
          Notwithstanding anything in the Lease to the contrary, the following shall apply and control:

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          Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements entered into after the Effective Date by Landlord and a licensee or lessee regarding Rooftop Equipment provided that such Rooftop Equipment does not interfere with Tenant’s Rooftop Equipment installed pursuant to this Section.
     14.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex (whether operated as a so-called “first run” theater and/or an “art house” theatre. In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second-run” or “adult” theater complex.
     15.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said

6


 

expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine
     16.  Alternate Rent . As of the Effective Date and if and for so long as Tenant continues to satisfy the Operating Condition (defined in Section 4 above), then in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of real estate taxes or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease), Tenant shall pay to Landlord on a monthly basis an amount equal to ***        of Tenant’s Gross Sales, as defined hereinabove. Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the prior year, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     17.  Early Termination — Tenant. (i) If, during any consecutive twelve (12) calendar month period after the Effective Date (the “Test Period”), the TLCF (defined on Exhibit “A-2” hereto) for the Leased Premises is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Test Period, to terminate the Lease as provided below in this Section; provided, however, that such notice and Tenant’s right to terminate the Lease as provided in this Section shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined in Section 4 above) continuously throughout the Test Period. In order to be effective, Tenant’s notice to Landlord under this Section shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice.
          (ii) If, at anytime during which Tenant is paying Alternate Rent, Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased Premises in excess of *** which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject

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to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that (1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) exceed ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 18 below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 18 below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
     Notwithstanding anything to the contrary set forth in the Lease, including Section 15 above, if Tenant elects to terminate this Lease pursuant to this Section and Landlord demolishes the theatre building of the Leased Premise within twelve (12) months after the date of termination, then Tenant shall reimburse Landlord for the actual out-of-pocket costs incurred by Landlord to demolish the theatre building (including, without limitation, the costs to remove from the Leased Premises all building materials and debris and all footings, foundations, utility lines and other underground installations that serve the Leased Premises and the costs to restore the surface of the Premises to a graded and landscaped surface); provided, however, that Tenant’s reimbursement obligations shall not exceed an amount equal to the product of *** psf multiplied by the ground floor area of the theatre building (in square feet). Tenant shall pay the amount due under this paragraph within thirty (30) days after receiving Landlord’s written demand for reimbursement, which shall include reasonable supporting documentation confirming the costs so incurred by Landlord. Tenant’s obligations under this paragraph shall expressly survive the termination of the Lease.
     18.  Early Termination — Landlord . Landlord shall have the right, at anytime after the Effective Date of this Amendment, to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.
     19.  Restrictive Covenant . Landlord covenants and agrees that upon the termination of the Lease for any reason other than the default of the Tenant, no portion of the Entire Premises including the Leased Premises shall be used as a motion picture theater complex for a period of ten (10) years from the date of termination. The terms and provisions of this Section shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after the request by

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Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the cost of all such recording fees.
     20.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     21.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its

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     obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     22.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President

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with a copy to:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: General Counsel
 
   
and a copy to:
  DLA Piper
 
  203 North LaSalle
 
  Suite 1900
 
  Chicago, IL 60601
 
  Attention: David Sickle, Esq.
 
   
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Plano, TX 75093
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     23.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     24.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     25.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
           
    Name:    
    Title:    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond W. Syufy    
 
           
    Name:    
    Title:    

 


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
  

 

EXHIBIT 10.13(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions Proration of Taxes
    6  
5.03 Omitted
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  
i

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII: Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       
ii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII : Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  
iii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
        Page No.
Exhibit A
  Description of Premises   A-1
Exhibit B
  Site Plan of Premises   B-1
Exhibit C
  Form of Memorandum   C-1
Exhibit D
  Guaranty of Lease   D-1
iv

 


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
                    Attached to this Lease and hereby made a part hereof are the following:
                    EXHIBIT A — a description of the Entire Premises.
                    EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red..
                    EXHIBIT C — Form of Memorandum of Lease
                    EXHIBIT D — Guaranty of Lease
      1.02. Definitions.
                    The following terms for purposes of this Lease shall have the meanings hereinafter specified:
                    The term “Commencement Date” shall mean October 1, 1995.
                    The term “Effective Date” shall mean October 1, 1995.
                    The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
                    The Term “Initial Rent Due Date” shall mean October 1, 1995.
                    The term “Initial Term” is defined in Section 2.02 herein.
                    The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

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                    The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
                    The term “Number of Term Years” shall mean ***
                    The term “Option Periods” shall mean ***   successive separate periods of ***        each.
                    The term “Percentage Rate” shall mean ***
                    The term “Premises” shall mean the Leased Premises.
                    The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
                    The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
                    The term “term of this Lease” or “term hereof shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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                    The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***          thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***          consecutive additional periods of ***          each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***         of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
                    (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
                    (2) Compliance with the following procedure for exercising the option in question:
                         (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                         (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
                    (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
                    (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted a non-exclusive easement for parking and ingress and egress on and over the Entire Premises. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use. Tenant shall be responsible for all costs related to the Entire Premises other than Landlord’s Building as set forth in the site plan attached.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***           The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***         after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***          Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***        Lease Year and on the first day of each ***           Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco- Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***            greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable there from, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any other items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which are assessed on any Buildings exclusive of the Leased Premises, Landlord shall pay Tenant all such impositions. With respect to Impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election, Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be. In the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Leased Premises located on the Entire Premises.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’s buildings.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

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ARTICLE VI

INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of Landlord’s Buildings), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (Landlord’s Buildings excluded), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord

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     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
                    (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
                    (2) Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such parry’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such parry’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible there for should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises .
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity .
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection . Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate often percent (10%) per annum.
     8.07 Effect of Termination .
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs .
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default .
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other parry which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
     15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severabilitv. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
                 
TENANT:
               
 
               
    CENTURY THEATRES OF CALIFORNIA, INC.,    
    a California Corporation    
 
               
    By: /s/ Joseph Syufy    
           
    Print Name: Joseph Syufy    
 
  Title:   V.P.        
 
               
LANDLORD:
               
 
               
    SYUFY ENTERPRISES    
    a California Limited Partnership    
 
               
    By: /s/ Raymond W. Syufy    
           
    Print Name: Raymond W. Syufy    
 
  Title:   G. P.        

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EXHIBIT 10.13(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located on North Capital Avenue in San Jose, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01 (B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than***           of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city
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admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
             
SYUFY ENTERPRISES, L.P
      CENTURY THEATRES, INC.    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond W. Syufy
      /s/ Joseph Syufy    
 
Raymond W. Syufy
     
 
Joseph Syufy
   
Chief Executive Officer
      President    
(STAMP)

Berryessa San Jose

 

 

EXHIBIT 10.13(c)
Second Amendment to Lease
      This Second Amendment To Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and CENTURY THEATRES, INC., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at 1171 North Capitol Avenue in San Jose, California and known as Century Berryessa; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas , Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Alterations — Changes
     Section 7.01 is hereby amended as follows:
     1. The last sentence of Section 7.01(A) is deleted in its entirety and replaced with the following:
Except as set forth in Section 7.01(E) below, Tenant must obtain Landlord’s prior written approval, which approval may be given or withheld in Landlord’s sole and absolute discretion, prior to making any changes, alterations or additions which are structural or exterior in nature.
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     2. The following shall be inserted at the end of Section 7.01 (B):
If any such lien attaches to the Premises or any part thereof, and Tenant does not cause the same to be released by payment, bonding or otherwise within ten (10) days after the attachment thereof, Landlord shall have the right but not the obligation to cause the same to be released, and any sums expended by Landlord (plus Landlord’s administrative costs) in connection therewith shall be payable by Tenant on demand with interest thereon from the date of expenditure by Landlord at the rate of eighteen percent (18%) per annum. Tenant shall give Landlord at least ten (10) days’ notice prior to the commencement of any alterations, additions or changes, and cooperate with Landlord in posting and maintaining notices of non-responsibility in connection therewith.
     3. The following new Section 7.01(D) shall be inserted after Section 7.01(C):
Tenant shall obtain liability insurance, in form and amount and from an insurance company acceptable to Landlord, insuring against damage and injury to person and property arising out of any alteration, addition or change. Tenant shall deliver to Landlord reasonably satisfactory documentary evidence that such insurance is in force before starting any work.
     4. The following new Section 7.01(E) shall be inserted after Section 7.01(D) and before Section 7.02:
Notwithstanding the terms and provisions of Section 7.01(A) above, Tenant may, without first obtaining Landlord’s prior written approval, construct a movie theater containing up to fifty-thousand (50,000) square feet with up to sixteen (16) movie screens and up to two thousand seven hundred (2,700) seats (the “ New Theater ”), subject to the following:
(i) Prior to the construction of the New Theater, Tenant shall provide Landlord with copies of the following: (a) detailed final plans and specifications prepared by a licensed architect or engineer, (b) building permits and all other required governmental approvals for the construction of the New Theater, (c) a copy of the construction contract, including the name of the contractor and all subcontractors proposed by Tenant to construct the New Theater, and (d) a copy of the contractor’s license.
(ii) During the construction of the New Theater, Tenant shall continue to pay Landlord all Rent due and payable to Landlord pursuant to Article IV of this Lease.
(iii) Within forty-five (45) days following the completion of the New Theater, Tenant shall provide Landlord with copies of the following documents: (a) the as-built plans and specifications for the New Theater, and (b) all certificates of occupancy for the New Theater.
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(iv) The construction and operation of the New Theater shall not obstruct or interfere with the parking and access rights of other tenants (and their employees and invitees) on or about the Entire Premises or any property adjacent thereto and owned by Landlord or an affiliate of Landlord.
(v) Landlord shall contribute no funds towards and shall have no ownership interest in the New Theater subject to the rights and obligations of the parties in Section C (“Surrender”) below.
B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building (which for all purposes herein shall include the New Theater), Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from
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Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P .,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
     
 
   
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
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EXHIBIT 10.13(d)
Third Amendment to Lease
      This Third Amendment To Lease (this “ Amendment ”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”) and CENTURY THEATRES, INC., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “Premises”) located at 1171 North Capitol Avenue in San Jose, California and known as Century Berryessa; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof , Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
 
Raymond Syufy,
     
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
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EXHIBIT 10.13(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Berryessa)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, a California Limited Partnership) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in San Jose, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) that certain Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease, the current Term of the Lease shall expire on the date that is ***

 


 

***          after the Effective Date hereof. Thereafter, the Term of this Lease shall automatically renew on a ***           basis unless Tenant delivers written notice to Landlord at least sixty (60) days prior to the then-current expiration date of the Term that Tenant elects not to extend the Term of the Lease.
     4.   Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Santa Clara typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.
     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:

 


 

     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the uninsured cost to repair such damage or to restore the Leased Premises (including deductibles) exceeds $50,000, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises (provided, however, that Landlord may nullify Tenant’s election not to undertake the repairs and restoration, within thirty (30) days after receiving Tenant’s notice by confirming either (x) that Landlord shall reimburse Tenant for such excess costs within 30 days after the completion of the repairs and restoration and Landlord’s receipt of reasonable supporting documentation of such costs or (y) that Landlord waives its right to terminate this Lease pursuant to Section 18 prior to the date which is 12 months after the repairs and restoration are completed), and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease. No assignment, subletting or other transfer of the Lease or the Leased Premises

 


 

shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1 ”.
     9.  [Intentionally Omitted] .
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and

 


 

other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment
     12.  Alterations by Tenant .

 


 

     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements entered into after the Effective Date by Landlord and a licensee or lessee regarding Rooftop Equipment provided that such Rooftop Equipment does not interfere with Tenant’s Rooftop Equipment installed pursuant to this Section.
     14.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex (whether operated as a so called “first run” theatre and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second-run” theater complex or a so-called “adult” theater complex.
     15.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease

 


 

beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine
     16.  Alternate Rent . As of the Effective Date and if and for so long as Tenant continues to satisfy the Operating Condition (defined above), then in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of Impositions or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease), Tenant shall pay to Landlord on a monthly basis an amount equal to ***           of Tenant’s Gross Sales, as defined hereinabove. Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the prior year, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     17.  Early Termination — Tenant . (i) If, during any consecutive twelve (12) calendar month period after the Effective Date (the “Test Period”), the TLCF (defined on Exhibit “A-2” hereto) for the Leased Premises is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Test Period, to terminate the Lease as provided below in this Section; provided , however , that such notice and Tenant’s right to terminate the Lease as provided in this Section shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined in Section 4 above) continuously throughout the Test Period. In order to be effective, Tenant’s notice to Landlord under this Section shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice.
     (ii) If, at anytime during which Tenant is paying Alternate Rent, Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased Premises in excess of ***

 


 

which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that (1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) exceed ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 18 below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 18 below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
     Notwithstanding anything to the contrary set forth in the Lease, including Section 15 above, if Tenant elects to terminate this Lease pursuant to this Section and Landlord demolishes the theatre building of the Leased Premise within twelve (12) months after the date of termination, then Tenant shall reimburse Landlord for the actual out-of-pocket costs incurred by Landlord to demolish the theatre building (including, without limitation, the costs to remove from the Leased Premises all building materials and debris and all footings, foundations, utility lines and other underground installations that serve the Leased Premises and the costs to restore the surface of the Premises to a graded and landscaped surface); provided, however, that Tenant’s reimbursement obligations shall not exceed an amount equal to the product of *** psf multiplied by the ground floor area of the theatre building (in square feet). Tenant shall pay the amount due under this paragraph within thirty (30) days after receiving Landlord’s written demand for reimbursement, which shall include reasonable supporting documentation confirming the costs so incurred by Landlord. Tenant’s obligations under this paragraph shall expressly survive the termination of the Lease.
     18.  Early Termination — Landlord. Landlord shall have the right, at anytime after the Effective Date of this Amendment, to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.
     19.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to

 


 

possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     20.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     21 Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:

 


 

     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       

 


 

         
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     22.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     23.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     24.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:
Name:
Title:
  /s/ Joseph Syufy
 
 
 
    
 
     
 
   
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:
Name:
Title:
  /s/ Raymond W. Syufy
 
 
 
    
 
     
 
   

 


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
  

 

EXHIBIT 10.14(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
Table of Contents
         
    Page No.
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Co-tenancy
       
2.01 Lease of Premises
    3  
2.02 Term of Lease
    3  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    4  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    5  
 
       
ARTICLE IV: Rent
       
4.01 Annual Fixed Rent
    5  
4.02 Percentage Rent
    6  
4.03 Rent Payments
    7  
4.04 Place for Payment of Rent
    7  
4.05 Late Payment of Rent
    7  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    7  
5.02 Proration of Taxes
    8  
5.03 Exceptions from Impositions; Charges in Lieu of Impositions
    8  
5.04 Contest of Taxes
    8  
5.05 Utilities
    8  
5.06 Personal Property Taxes
    8  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    9  
6.02 Types of Required Insurance
    9  
6.03 Terms of Insurance
    9  
6.04 Landlord’s Acquisition of Insurance
    10  
6.05 Insurance Money and Other Funds Held In Trust
    10  

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Table of Contents
         
    Page No.
6.06 Application or Proceeds of Physical Damage Insurance
    10  
6.07 Cooperation for Insurance Proceeds
    11  
6.08 Waiver of Right of Recovery
    11  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    12  
7.02 Repairs — Maintenance
    12  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    13  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    13  
8.03 Remedial Work
    15  
8.04 Maintenance of Premises
    16  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    16  
8.06 Landlord Inspection
    17  
8.07 Effect of Termination
    18  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant Improvements
    18  
9.02 Hold Harmless
    18  
9.03 Permits; Compliance With Codes
    18  
9.04 Ownership of Improvements
    19  
9.05 Control
    19  
 
       
ARTICLE X: Indemnity
       
10.01 Landlord’s Indemnity
    19  
10.02 Tenant’s Indemnity
    19  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    20  
11.02 Notice to Landlord
    20  
 
       
ARTICLE XII: Mortgage Subordination
       
12.01 Existing Mortgages
    21  
12.02 Future Mortgages
    21  

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Table of Contents
         
    Page No.
 
       
ARTICLE XIII: Condemnation — Eminent Domain
       
13.01 Definitions
    21  
13.02 Notice to Other Party
    22  
13.03 Total Taking — Effect on Rent and Term
    22  
13.04 Distribution of Award for Taking
    22  
13.05 Partial Taking — Rent Adjustments
    23  
13.06 Partial Taking — Option to Terminate
    23  
13.07 Separate Tenant’s Award
    23  
 
       
ARTICLE XIV: Default
       
14.01 Tenant’s Default
    23  
14.02 Landlord’s Remedies Cumulative
    23  
14.03 Landlord’s Default
    25  
14.04 Waiver of Redemption
    26  
14.05 Dispute Resolution
    26  
14.06 Attorney Fees
    27  
 
       
ARTICLE XV: Representations and Warranties
       
15.01 Landlord’s Representations and Warranties
    27  
15.02 Tenant’s Representations and Warranties
    27  
 
       
ARTICLE XVI: Damage or Destruction
       
16.01 Repairs, Alterations and Further Improvements
    28  
16.02 Prompt Repair
    29  
16.03 Rent Adjustment
    29  
16.04 Damage During Last Ten (10) Years of Term
    29  
 
       
ARTICLE XVII: Miscellaneous
       
17.01 Limitation on Liability
    30  
17.02 Brokers
    30  
17.03 Modification
    30  
17.04 Severability
    30  
17.05 Governing Law
    30  
17.06 Terminology
    30  
17.07 Counterparts
    30  
17.08 Binding Effect
    31  

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Table of Contents
         
    Page No.
17.09 Captions
    31  
17.10 Notice to Landlord and Tenant
    31  
17.11 Addresses for Notices to Landlord and Tenant
    31  
17.12 Entire Agreement
    32  
17.13 Sale or Transfer of Premises
    32  
17.14 Force Majeure
    32  
17.15 Waiver
    32  
17.16 Estoppel Certificate
    33  
17.17 Number and Gender
    33  
17.18 No Holding Over
    33  
17.19 Mechanics Liens
    33  
17.20 Relationship of Parties
    33  
17.21 Time of the Essence
    34  
17.22 Facsimile Copies
    34  
17.23 Anti-Merger
    34  
 
       
Signature Page
       
 
       
Exhibit A       A Description of Entire Premises
       
Exhibit B       A Site Plan of Entire Premises
       
Exhibit C       Form of Memorandum of Lease
       
Exhibit D       Guaranty of Lease
       

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LEASE
     THIS INDENTURE OF LEASE, dated as of December 1, 1995, by and between Syufy Enterprises, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, CA, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in a parcel of land described on Exhibit A attached hereto.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
     ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
          Attached to this Lease and hereby made a part hereof are the following:
          EXHIBIT A — a description of the tract of land hereinafter referred to as “Entire Premises”.
          EXHIBIT B — a site plan of the Entire Premises showing Tenant’s Building.
          EXHIBIT C — Form of Memorandum of Lease.
          EXHIBIT D — Guaranty of Lease.
      1.02. Definitions .
          The following terms for purposes of this Lease shall have the meanings hereinafter specified:
          The term “Commencement Date” shall mean July 1, 1996.

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          The term “Effective Date” shall mean December 1, 1995.
          The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
          The term “Entire Premises” shall mean the tract of land described on Exhibit B.
          The term “Initial Rent Due Date” shall mean July 1, 1996.
          The term “Initial Term” is defined in Section 2.02 herein.
          The term “Leased Premises” or “Premises” shall mean the Entire Premises.
          The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
          The term “Number of Tenant Working Days” shall mean 365 days.
          The term “Number of Term Years” shall mean***
          The term “Option Periods” shall mean***           successive separate periods of *** each.
          The term “Percentage Rate” shall mean ***
          The term “Planned Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
          The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.

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               The term “Tenant’s Building” shall mean the building to be erected by Tenant at Tenant’s sole cost.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises .
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date.
     2.02 Term of Lease .
               Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***     thereafter and shall terminate on the last day of the calendar month during which the date which is***     after the Commencement Date occurs. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term .
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***     consecutive additional periods of***     each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***     of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.

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          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                         (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                         (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default (meaning the breach of any obligation hereunder and failure to cure that breach within the time permitted in Section 14.01) at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple.
               (B) Tenant shall give Landlord prior written notice before commencing any work upon the Premises, and shall cause all work to be performed by Tenant to be conducted in such a manner that the same does not unreasonably interfere with the other tenant’s customers or their business operations.
               (C)  Maintenance of Entire Premises . At all times during the Term, Tenant shall keep and maintain the Exterior Common Facilities in the Entire Premises and Tenant’s Building in good order and repair and in a clean and safe condition, reasonably free of debris. Tenant’s obligation hereunder shall included maintaining the parking areas of the Entire Premises free of potholes and assuring that they are properly coated and sealed and striped as needed. Tenant shall make any and all additions to and all alterations and repairs in, on and about the Entire Premises, which may be required by, and shall otherwise observe and comply with, all public laws, ordinances and regulations from time to time applicable to the Entire Premises. Tenant shall indemnify and save harmless Landlord from and

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against all actions, claims and damages by reason of Tenant’s failure to comply with and perform its obligations under this section.
               (D)  Tenant’s Liens Tenant will not permit the Entire Premises to become subject to any mechanics’, laborers’ or materialmen’s lien on account of labor or material furnished to Tenant or claimed to have been furnished to Tenant in connection with work of any character performed or claimed to have been performed on the Entire Premises by or at the direction or sufferance of Tenant; provided, however, Tenant shall have the right to contest in good faith and with reasonable diligence the validity of any such lien or claimed lien and on final determination of the lien or claim for the lien, Tenant will immediately pay any judgment rendered with all proper costs and charges, and will, at its own expense, have the lien released and any judgment satisfied.
ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Planned Use no other purpose.
          B) Landlord shall agree and consent to such utility and other easements encumbering the Premises or benefiting the Premises and encumbering the Fee Parcels as Tenant may reasonably require for its use and occupancy of the Premises.
          C) Landlord agrees that no use of the Entire Premises shall be permitted which is inconsistent with the operation of the Planned Use. Tenant shall be subject to and responsible for all costs and granted all rights as set forth in the Covenants, Conditions, Restrictions and Grants of Easements covering the Premises.
ARTICLE IV
RENT
     4.01 Annual Fixed Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term Annual Fixed Rent in the amount of *** The Annual Fixed Rent shall be payable in advance in twelve (12) equal monthly installments. The Annual Fixed Rent shall be subject to adjustment every ***        after the Initial Rent Due Date as set forth in Section 4.01 (B) below.
          B) The Annual Fixed Rent shall apply from the Rent Commencement Date through the end of the ***        Lease Year of the Term. The Annual Fixed Rent shall be increased (but never decreased) on the first day of the ***         Lease Year and on the first day of each ***        Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor,

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Bureau of Labor Statistics Consumer Price Index for all Urban Consumers, Sacramento, Subgroup “All Items”, (1982-84+100) (the Consumers Price Index”; provided however, in no event shall the Annual Fixed Rent be increased by an amount that is less than *** greater than the Annual Fixed Rent payable before the adjustment date in question.
               In the event that the Consumer Price Index is not available, the successor or substitute index, shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent.
            In addition to the payment of Annual Fixed Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***     of the Gross Sales for such Lease Year exceeds the Annual Fixed Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross sales and the annual fixed rate percentage for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Annual Fixed Rate and Gross Sales for the first Lease Year.
            Gross Sales shall mean all box office receipts, and receipts from sales of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant and returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions”. Commissions paid to agencies or other third parties for selling tickets and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
            Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
            The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined

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as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof.
     4.03 Rent Payments . Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions .
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay when due all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises.. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
          B) In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall

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immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions .
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.03 Contest of Taxes . Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.03. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.03.
     5.04 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities consumed on the Entire Premises exclusive of Landlord’s Buildings, if any. Any utility improvements presently serving the Entire Premises shall be maintained, repaired and replaced by Tenant, at Tenant’s expense.
     5.06 Personal Property Taxes . During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’

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fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies . Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance . Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance . Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises, Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance . During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) as well as any and all improvements on the Entire Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) including Builder’s Risk but excluding earthquake and flood to the extent of not less than 100% of the full replacement cost thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Upon written request, Tenant shall name Landlord and any parties requested by Landlord and the holder of the first mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Tenant in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance . The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:

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          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance . If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or proceeds received by the Tenant and/or Landlord shall be held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and Second, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance . In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVI hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Tenant and Landlord shall apply the proceeds of the insurance collected to the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Tenant and Landlord by the licensed architect or engineer in charge of the work. Any amounts payable to Tenant or any Affiliate of Tenant for work or services performed or materials provided as part of any such repair, replacement, restoration or rebuilding shall not exceed competitive rates for such services or materials and Tenant

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shall, upon request of Landlord, make available to Landlord and its representatives all books and records of Tenant relating to such work, services and materials. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Tenant or Landlord with respect to the damage or destruction involved, and not used, shall be and remain the property of Landlord.
          A) Distribution of Unutilized Proceeds . At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Tenant and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds . Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery . Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unleasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have

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released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes .
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto.. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained, which approval shall not be unreasonably withheld.
          B) Tenant shall at all times keep the Entire Premises, Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          C) Upon termination of this Lease, Tenant may, at its option, remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance .
          A) Tenant shall, at its sole cost and expense, maintain and repair the Entire Premises and Tenant’s Building and all improvements on the Entire Premises and including all exterior lighting and signs.
          B) Tenant shall also be responsible for any losses or damages resulting from any materials, substances or liquids which are leaked or discharged from the Entire Premises.
          Tenant shall commence all of the repairs and maintenance within 3 days after receiving notice thereof from Landlord (provided that in the case of an emergency Tenant shall commence such work immediately upon receiving notice) and shall be diligently completed in a good and workmanlike manner. Notwithstanding the foregoing, Landlord shall have the right and option (but not the

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obligation) to undertake any such repair, maintenance or other items, in which event Tenant shall reimburse Landlord for all of the costs thereof within 30 days after Landlord’s request therefor. If Tenant fails to reimburse Landlord within the 30 day period, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum until such payment has been made.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition . For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the

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Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.

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          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar

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information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises .
          A) Subject to Landlord’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity .
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify

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Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.

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     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant Improvements. Tenant at its sole cost and expense shall complete all the required on-site and off-site improvements, including all signs, required for the development of the Entire Premises. In addition Tenant shall construct a motion picture theater building on the Premises containing approximately sixty thousand (50,000) square feet with fourteen auditoriums. Landlord will provide Tenant with a site and building allowance of $5,294,200.00. The site and building allowance will be paid by Landlord to Tenant the latter of July 1, 1996 or the date Tenant opens to the public for business.
     9.02 Hold Harmless . Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of by Tenant of Tenant’s Building and Improvements or repairs made at any time to the Entire Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.

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     9.04 Ownership of Improvements .
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein excluding moveable trade fixtures and personal property of Tenant, shall become the property of Landlord, unless and to the extent Tenant elects to remove any of the foregoing pursuant to Section 9.04 (B).
          B) Tenant shall have the right to remove all trade fixtures, equipment and furnishings, including seats, carpets, draperies, screen, sound reproducing equipment, projection equipment, furniture and lobby frames from the Premises without notice to Landlord and the foregoing shall remain the property of the Tenant at the expiration or earlier termination of the Lease. In addition, Tenant shall have the right if Tenant so elects by giving written notice to Landlord of such election at any time before ninety (90) days prior to the end of the Term (including any renewals or extensions) hereof to remove any other Improvements and all additions, alterations and improvements thereto or replacements thereof erected, constructed, or installed on the Premises. The removal of any of the foregoing shall be completed within thirty (30) days following the end of the Term hereof (including any renewals thereof or any earlier termination permitted by this Lease.
     9.07 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Landlord’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Tenant, its agents, employees, licensees, invitees or contractors on the Leased Premises, occurring within the Leased Premises or (ii) arising from Tenant’s or its employees use of the Leased Premises.
     10.02 Tenant’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Tenant and its agents, employees, tenants, licensees and contractors, Landlord shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant)

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and save Tenant (and its successors, assigns and subletees), and all of their directors, officers, employees and agents, hereinafter referred to as “Tenant Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Landlord, its agents, employees, licensees, invitees on the Entire Premises or contractors, occurring within the Entire Premises, or (ii) arising from Landlord’s use of the Entire Premises.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting .
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease. Landlord shall be entitled to all rent from any assignment or sublease in excess of the Annual Fixed Rent set forth in this Lease.
          B) Any assignment of this Lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without Landlord’s consent, assign this Lease (a) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (b) to Tenant’s Parent Corporation, or (e) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, provided that such corporation duly and validly then guarantees the performance of the obligations under this Lease.
     11.02 Notice to Landlord . Tenant shall give notice to Landlord in writing of any assignment of the Lease ten (10) days prior to such event.

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ARTICLE XII

MORTGAGE SUBORDINATION
     12.01 Existing Mortgages. If there is an existing mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises or in any other part of the Entire Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     12.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIII
CONDEMNATION — EMINENT DOMAIN
     13.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Entire Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     13.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     13.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     13.04 Distribution of Award for Taking . On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any for the Fair Market Value of all Land, buildings and other improvements on the Entire Premises and all Severance Damages.

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          B) To Tenant, the amount awarded, if any, for loss of goodwill, lost business, lost profits, relocation expenses and fixtures; and
          C) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 13.04 out of amounts awarded by the governmental body taking the Premises.
     13.05 Partial Taking — Rent Adjustments . On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises or the parking taken bears to the total area of the Premises or the parking.
     13.06 Partial Taking — Option to Terminate . Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty-three percent (33%) of the Building or thirty-three (33%) of the parking is taken by condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     13.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses, fixtures and relocation expenses against the acquiring governmental Agency.
ARTICLE XIV
DEFAULT
     14.01 Tenant’s Default . The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Fixed Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease; provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
     14.02 Landlord’s Remedies Cumulative . Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03.

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These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance . Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination . Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 14.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession . No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and

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               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
          D) Definitions . As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 14.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 14.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender . Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 14.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver . If Tenant defaults under Section 14.02(C), Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 14.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     14.03 Landlord’s Default .
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.

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          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     14.04 Waiver of Redemption . Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     14.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 14.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute . The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation . A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter.
          C) Arbitration . With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party, which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. Arbitration shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association.

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     14.06 Attorneys’ Fees . Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XV
REPRESENTATIONS AND WARRANTIES
     15.01 Landlord’s Representations and Warranties . Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     15.02 Tenant’s Representations and Warranties . Tenant represents and warrants:

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          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVI
DAMAGE OR DESTRUCTION
     16.01 Repairs. Alterations and Further Improvements .
          A) Tenant’s Obligation to Repair . In the event of damage to or destruction of the Tenant’s Building or any Improvements on or to the Premises to be covered by the insurance described in Article 6:
               (1)  Damages of Less Than Fifty Percent (50%) of Replacement Cost . If the cost of repairing or reconstructing the Tenant’s Building or Improvements to the condition and form prior to such damage or destruction is not in excess of Fifty percent (50%) of the then new replacement cost of the Improvements and such repairs or reconstruction of any such damage or destruction can be made under then existing laws, ordinances, statutes or regulations of any governmental authorities applicable thereto (or can be so made with minor and non-material changes to the former condition and form of property damaged or destroyed), Tenant shall effect, and Landlord and Tenant agree that the funds derived from insurance acquired pursuant to Article 6 shall be made available to effect, such repair and reconstruction of the structure or improvement so damaged or destroyed to substantially its condition prior to said damage or destruction with such alterations thereto as Tenant shall reasonably determine prudent or valuable under the circumstances, including any changes required to comply with applicable law, with the then prevailing construction practices applicable to the Premises. Tenant shall be responsible for all costs in excess of Insurance proceeds available All such work shall be carried on in accordance with Drawings prepared by a licensed architect or architects approved by Landlord (acting reasonably) if such an architect is reasonably required, given the scope and nature of the work. In disbursing insurance proceeds the Tenant and Landlord may rely upon and accept the certified determinations of such architect with respect to estimated costs, awarding of contracts, sufficiency of bonds, progress of construction, interpretation of plans and specifications, compliance with same, and completion of construction. No extras or changes in Drawings shall be made by Tenant without first giving written notice of such changes to Landlord and obtaining Landlord’s approval thereof (which approval shall not be unreasonably withheld or delayed).

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               (2)  Damage in Excess of Fifty Percent (50%) . If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of the Fifty percent (50%) provided in subparagraph (A)(1) of this Section 16.01, or if such cost is less than Fifty percent (50%), but such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto (and cannot be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), and, in any such event, the parties hereto are unable during a period of ninety (90) days after the determination by Tenant with respect to such damage or destruction to agree in writing on a construction program, then, at Tenant’s sole option, the Term shall end as of the date of such damage or destruction, provided that Tenant notifies Landlord of its election to exercise such termination option within such ninety (90) day period. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), but the cost of so repairing or reconstructing such damage or destruction is in excess of the Fifty percent (50%) provided for in subparagraph (A)(1) of this Section 16.01, Tenant shall have the absolute right to treat such damage as under subparagraph (A)(1) of this Section 16.01 as if the damage or destruction met the description thereof set forth in the first sentence of that Section if Tenant (i) gives notice to the effect to Landlord within such ninety (90) days period after Tenant’s determination with respect to said damage or destruction; and (ii) promptly demonstrates to the reasonable satisfaction of any Leasehold Mortgagee (if any) that it can provide the funds required or that will be required under the provisions of subparagraph (A)(1) of this Section 16.01 to effect such repair or restoration, whereupon the provisions of said subparagraph (A) of this Section 16.01 shall be fully applicable to such damage or destruction.
     16.02 Prompt Repair . If Tenant, pursuant to the terms hereof, is obligated or elects to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided and subject to the provisions of subparagraph(B) of Section 16.01), and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     16.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall thereafter not abate but continue for as long as and to the extent such Improvements are untenantable.
     16.04 Damage During Last Two (2) Years of Term . If there occurs during the last ten (10) years of the Initial Term or at any time during a Renewal Period damage or destruction to any Improvement on or in the Premises and the costs of repairing, restoring, replacing or rebuilding the

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same exceed Five Thousand Dollars ($500,000), then Tenant may elect to terminate the Term and, in such event, Tenant shall give notice to Landlord of its election within sixty (60) days after its determination of the amount of damage, and the Term shall thereupon terminate as of the date of such notice.
ARTICLE XVII
MISCELLANEOUS
     17.01 Limitation on Liability . The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Entire Premises and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Entire Premises.
     17.02 Brokers . Landlord and Tenant each represent to the other that neither has any obligation to any broker or finder in connection with this transaction, and that no fee or commission is due any broker, finder, or similar person in connection herewith. Landlord and Tenant each indemnifies the other and agrees to hold the other harmless from and against any and all claims, demands, liabilities, lawsuits, costs, and expenses (including reasonable attorneys’ fees) for any fee or commission due to any other broker, finder, or similar person in connection with this transaction and arising out of the act of the indemnifying party.
     17.03 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     17.04 Severability . In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     17.05 Governing Law . This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     17.06 Terminology . All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     17.07 Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.

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     17.08 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     17.09 Captions . Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     17.10 Notices to Landlord and Tenant .
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 17.11 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 17.11 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent..
     17.11 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102

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  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Real Estate Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     17.12 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     17.13 Sale or Transfer of Premises . Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     17.14 Force Majeure . In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     17.15 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other

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than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     17.16 Estoppel Certificate . Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     17.17 Number and Gender . Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     17.18 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     17.19 Mechanics Liens . Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     17.20 Relationship of Parties . Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities,

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     17.21 Time of the Essence . Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     17.22 Facsimile Copies . Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     17.23 Anti-Merger . The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
          Executed as of the date first written above.
TENANT:
             
    CENTURY THEATRES OF CALIFORNIA, INC.,
a California corporation
   
 
           
 
  By:   /s/ JOE SYUFY    
 
           
 
  Print Name:   Joe Syufy    
 
  Title:   Senior Exec VP    
LANDLORD:
             
    SYUFY ENTERPRISES, a
California Limited Partnership
   
 
           
 
  By:   /s/ RAYMOND SYUFY    
 
           
 
  Print Name:   Raymond Syufy    
 
  Title:   President    

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EXHIBIT 10.14(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated December 1, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Folsom, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Sacramento” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***       of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Folsom

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VEL”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Surrender
     After the first sentence of Section 14.02(E), the following sentence is hereby inserted:
     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
Folsom

 


 

     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
         
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.    
“Landlord”
  “Tenant”    
/s/ Raymond W. Syufy
  /s/ Joseph Syufy    
 
       
Raymond W. Syufy
  Joseph Syufy    
Chief Executive Officer
  President    
[STAMP]

Folsom

 

 

EXHIBIT 10.14(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”), and Century Theatres, Inc., a California corporation (“ Tenant ”).
WITNESSETH:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated December 1, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000, between Syufy Enterprises, L.P. and Century Theatres, Inc., a Delaware corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at Las Alhambras Center, Iron Point Road, Folsom, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01 (a) of the Lease, the following is hereby inserted:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and
Century 14 — Folsom, CA

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advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “ FF&E ”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
Century 14 — Folsom, CA

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     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century 14 — Folsom, CA

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises , L.P.
  CENTURY THEATRES, INC.
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ RAYMOND W. SYUFY
  /s/ JOSEPH SYUFY
 
   
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  Chief Executive Officer
Century 14 — Folsom, CA

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EXHIBIT 10.14(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “ Amendment ”) dated September 29,2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres , Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated December 1, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease”), for a motion picture building and related parking (the “ Premises ”) located at Las Alhambras Center, Iron Point Road, Folsom, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     1. Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
Century 14 — Folsom, CA

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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.
  Century Theatres, Inc.
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ RAYMOND SYUFY
  /s/ JOSEPH SYUFY
 
   
Raymond Syufy
  Joseph Syufy
Chief Executive Officer
  Chief Executive Officer
Century 14 — Folsom, CA

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EXHIBIT 10.14(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Folsom)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres of California, Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of December 1, 1995 (the “Original Lease”), for certain premises located in Folsom, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) that certain Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***         and rather than ***         Renewal Terms of ***         each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for consecutive Renewal Terms of ***         each, followed by one (1) additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in Sacramento, California metropolitan area typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

 


 

     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in subsection (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

 


 

not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:

 


 

     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
     (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;

 


 

     (ii) Attributable to the annual inflationary increases in real estate taxes; or
     (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theatre complex. Tenant shall be required to complete all alterations, improvements and changes undertaken by Tenant. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission

 


 

devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
     (a) Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
     (b) Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
     (c) Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.

 


 

     (d) Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
     (e) Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex (whether operated as a so-called “first run” theatre and/or an “art house” theatre. In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second-run” theatre complex or as a so-called “adult” theatre complex.
     16.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  ***     Rent Conversion and Early Termination .
     (a) As of the Effective Date hereof, the parties have been made aware of the possibility that a new motion picture theatre complex may be developed and operated at the location of the *** on the site which is approximately *** acres on the *** (the “Nearby Theatre”).
     (b) If the Nearby Theatre opens for business and thereafter during any consecutive twelve (12) calendar month period (the “First Test Period”), the Theatre Level Cash Flow (“TLCF”), as defined in Exhibit “A-3” hereto, for the Leased Premises over such First Test Period is less than ***, then upon notice from Tenant to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Test Period, the ***     Rent Conversion (defined below) will become effective; provided , however , that such notice and Tenant’s right pursuant to the ***     Rent Conversion as

 


 

provided in this subparagraph (b) shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined in Section 3 above) throughout the First Test Period. In order to be effective, Tenant’s notice to Landlord under this subparagraph (b) shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the First Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then effective as of the first day of the first calendar month following Landlord’s receipt of Tenant’s notice as provided above and thereafter so long as Tenant continues to satisfy the Operating Condition, in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of Impositions or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease) Tenant shall pay to Landlord on a monthly basis an amount equal to ***     of Tenant’s Gross Sales, as defined in Section 9 above (the “***     Rent Conversion”). Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the applicable period, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     (c) (i) If the ***     Rent Conversion occurs and thereafter during any consecutive twelve (12) calendar month period (the “Second Test Period”), the TLCF for the Leased Premises is less than ***, then Tenant shall have the right to be exercised by written notice to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Second Test Period, to terminate the Lease as provided below in this subparagraph (c); provided , however , that such notice and Tenant’s right to terminate the Lease as provided in this subparagraph (c) shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined above) continuously throughout the Second Test Period. In order to be effective, Tenant’s notice to Landlord under this subparagraph (c) shall include a written certification to Landlord from Tenant’s chief financial officer or controller that the TLCF for the Second Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the expiration of the termination notice.
          (ii) If the ***    Rent Conversion occurs, and if at any time thereafter, Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased Premises in excess of *** which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that

 


 

(1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) exceed ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 17(d) below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 17(d) below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
Notwithstanding anything to the contrary set forth in the Lease, including Section 16 above, if Tenant elects to terminate this Lease pursuant to this Section 17 and Landlord demolishes the theatre building of the Leased Premise within twelve (12) months after the date of termination, then Tenant shall reimburse Landlord for the actual out-of-pocket costs incurred by Landlord to demolish the theatre building (including, without limitation, the costs to remove from the Leased Premises all building materials and debris and all footings, foundations, utility lines and other underground installations that serve the Leased Premises and the costs to restore the surface of the Premises to a graded and landscaped surface); provided, however, that Tenant’s reimbursement obligations shall not exceed an amount equal to the product of *** psf multiplied by the ground floor area of the theatre building (in square feet). Tenant shall pay the amount due under this paragraph within thirty (30) days after receiving Landlord’s written demand for reimbursement, which shall include reasonable supporting documentation confirming the costs so incurred by Landlord. Tenant’s obligations under this paragraph shall expressly survive the termination of the Lease.
     (d) If the ***     Rent Conversion occurs, then Landlord shall have the right at anytime thereafter to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.
     18.  Restrictive Covenant . Landlord covenants and agrees that upon the termination of the Lease for any reason other than the default of the Tenant, no portion of the Entire Premises including the Leased Premises shall be used as a motion picture theater complex for a period of 10 years from the date of termination. The terms and provisions of this Section shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after the request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the cost of all such recording fees.
     19.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:

 


 

Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     20.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     21.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:

 


 

     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
          Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.

 


 

         
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     22.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     23.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     24.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures appear on following page]

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ JOSEPH SYUFY    
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ RAYMOND W. SYUFY    
 
           
 
  Name:        
 
           
 
  Title:        
 
           

 


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
 A-3-1 

 

EXHIBIT 10.15(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions – Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    3  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Proration of Taxes
    6  
5.03 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII: Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15 02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15 05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

iii


 

LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
Exhibit A
  Description of Premises     A-l  
Exhibit B
  Site Plan of Premises     B-l  
Exhibit C
  Form of Memorandum     C-l  
Exhibit D
  Guaranty of Lease     D-l  

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LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF NEVADA, INC., a Nevada corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building and Theatre Improvements located in the State of Nevada as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
          Attached to this Lease and hereby made a part hereof are the following:
          EXHIBIT A — a description of the Premises.
          EXHIBIT B — a site plan of the Premises.
          EXHIBIT C — Form of Memorandum of Lease
          EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
          The following terms for purposes of this Lease shall have the meanings hereinafter specified:
          The term “Commencement Date” shall mean October 1, 1995.
          The term “Effective Date” shall mean October 1, 1995.
          The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
          The Term “Initial Rent Due Date” shall mean October 1, 1995.
          The term “Initial Term” is defined in Section 2.02 herein.

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          The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
          The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
          The term “Number of Term Years” shall mean***
          The term “Option Periods” shall mean ***     successive separate periods of ***     each.
          The term “Percentage Rate” shall mean ***
          The term “Premises” shall mean the real property set forth in Exhibit A.
          The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
          The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
          The term “term of this Lease” or “term hereof shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***     thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***     consecutive additional periods of ***     each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***     of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted an easement for ingress, egress and parking under all reciprocal agreements that Landlord is entitled to for this property. In addition Tenant shall be obligated to pay all costs and is granted all rights under all leases Landlord is a party to for this property.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***     The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every***     after the Initial Rent Due Date as set forth, in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the***     Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the***     Lease Year and on the first day of each***     Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Las Vegas Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***     greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***     of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or Pass Admissions” including EBF charges on ‘Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations-Changes.
          A) At any time and from time to time during the Lease Term Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises that all such alterations or changes in Improvements and new Improvement shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions, on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at above actionable levels by Tenant its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used; generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (as) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parries for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however. Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof shall become the property of Landlord and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Tenant.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Tenant at the termination of this lease.
     9.05 Control Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
          14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purpose of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,’’ as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination and under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is-no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to pacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs. Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortage of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of Nevada and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine or neuter gender, shall include all other genders; the singular shall include the plural and vice versa “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of Nevada, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
CENTURY THEATRES OF NEVADA, INC.,
a Nevada Corporation
By: /s/ Joseph Syufy
Print Name: Joseph Syufy
Title: V. P.
LANDLORD:
SYUFY ENTERPRISES
a California Limited Partnership
By: /s/ Raymond W. Syufy
Print Name: Raymond W. Syufy
Title: G. P.

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EXHIBIT 10.15(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of Nevada, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”), known as the Cinedome Theater, located in Henderson, Nevada; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of Nevada, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of Nevada, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Las Vegas” is hereby deleted and in its place is inserted the “Los Angeles-Orange County Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***            of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city
Cinedome Henderson

 


 

admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
Cinedome Henderson

 


 

     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
“Landlord”
  CENTURY THEATRES, INC.
“Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
Cinedome Henderson

 

 

EXHIBIT 10.15(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment” ) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ), and Century Theatres, Inc. , a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of Nevada, Inc. entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000, between Syufy Enterprises, L.P. and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at 851 So. Boulder Highway, Henderson, Nevada; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of Nevada, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of Nevada, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and
Cinedome 12 — Henderson, NV

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advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
Cinedome 12 — Henderson, NV

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     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Cinedome 12 — Henderson, NV

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
“Landlord”
  a California, corporation
“Tenant”
   
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
Cinedome 12 — Henderson, NV

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EXHIBIT 10.15(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “ Amendment ”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”), and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of Nevada, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at 851 So. Boulder Highway, Henderson, Nevada; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), succeeded Century Theatres of Nevada, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of Nevada, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
Cinedome 12 — Henderson, NV

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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
“Landlord”
  a California, corporation
“Tenant”
   
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
Cinedome 12 — Henderson, NV

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EXHIBIT 10.15(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Henderson, Nevada)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS:
     A. Landlord (then known as Syufy Enterprises (“Original Landlord”)) and Century Theatres of Nevada Inc., a Nevada corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Henderson, Nevada.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) that certain Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

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      3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***       and rather than ***       Renewal Terms of ***       each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***       consecutive Renewal Terms of ***       each, followed by ***       additional and final Renewal Term of: ***
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the State of Nevada typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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      6. Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7. Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture

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theatre complex. Tenant shall be required to complete all alterations, improvements and changes that Tenant undertakes. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     12.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     13.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.

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  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     14.  Removal of Equipment. Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     15.  ***       Rent Conversion and Early Termination upon opening of Nearby Theatre.
     (a) If a motion picture theatre complex (other than motion picture theatre complexes that exist as of the Effective Date) located within *** of the theatre (the “Nearby Theatre”) commences operation after the Effective Date of this Amendment

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and thereafter during any consecutive twelve (12) calendar month period (the “First Test Period”), the Theatre Level Cash Flow (“TLCF”), as defined in Exhibit “A-3” hereto, for the Leased Premises is less than ***, then upon notice from Tenant to Landlord at any time when the most current trailing twelve (12) month period was *** or within forty-five (45) days after such First Test Period, the ***       Rent Conversion (defined below) will become effective; provided , however , that such notice and Tenant’s right to the ***       Rent Conversion as provided in this subparagraph (a) shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined above) continuously throughout the First Test Period. In order to be effective, Tenant’s notice to Landlord under this subparagraph (a) shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the First Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then effective as of the first day of the first calendar month following Landlord’s receipt of Tenant’s notice as provided above and thereafter so long as Tenant continues to satisfy the Operating Condition, in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of Impositions or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease) Tenant shall pay to Landlord on a monthly basis an amount equal to ***      of Tenant’s Gross Sales, as defined in Section 10 above (the“ ***       Rent Conversion”). Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days following the end of each fiscal year, Tenant shall provide certification of Tenant’s Gross Sales for the applicable period, executed by the chief financial officer or the controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     (b) (i) If the ***       Rent Conversion occurs and thereafter during any consecutive twelve (12) calendar month period (the “Second Test Period”), the TLCF for the Leased Premises is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Second Test Period to terminate the Lease as provided below in this subparagraph (b); provided , however , that such notice and Tenant’s right to terminate the Lease as provided in this subparagraph (b) shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined above) continuously throughout the Second Test Period. In order to be effective, Tenant’s notice to Landlord under this subparagraph (b) shall include a written certification to Landlord from Tenant’s chief financial officer or controller that the TLCF for the Second Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice.
     (ii) If the ***       Rent Conversion occurs and if, at anytime thereafter Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased

8


 

Premises in excess of *** which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that (1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) exceed ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 15(c) below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 15(c) below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
Notwithstanding anything to the contrary set forth in the Lease, including Section 14 above, if Tenant elects to terminate this Lease pursuant to this Section 15 and Landlord demolishes the theatre building of the Leased Premise within twelve (12) months after the date of termination, then Tenant shall reimburse Landlord for the actual out-of-pocket costs incurred by Landlord to demolish the theatre building (including, without limitation, the costs to remove from the Leased Premises all building materials and debris and all footings, foundations, utility lines and other underground installations that serve the Leased Premises and the costs to restore the surface of the Premises to a graded and landscaped surface); provided, however, that Tenant’s reimbursement obligations shall not exceed an amount equal to the product of *** psf multiplied by the ground floor area of the theatre building (in square feet). Tenant shall pay the amount due under this paragraph within thirty (30) days after receiving Landlord’s written demand for reimbursement, which shall include reasonable supporting documentation confirming the costs so incurred by Landlord. Tenant’s obligations under this paragraph shall expressly survive the termination of the Lease.
     (c) If the ***       Rent Conversion occurs, then Landlord shall have the right at anytime thereafter to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.
     16.  Remedies . The references in Article XV of the Lease to California Code Sections shall be disregarded. In the event of a breach or default by Tenant which is not cured within the

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applicable cure periods (if any) set forth in the Lease, Landlord shall have any and all remedies now or later allowed by law or equity.
     17.  [Intentionally Omitted] .
     18.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with applicable law.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel

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  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     19.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     20.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio - it being the intent of the parties hereto that this Amendment shall supersede such Second Amendment and Third Amendment in their entirety.
     21.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Raymond Syufy    
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Joseph Syufy    
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   

 


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
 A3-1 

 

EXHIBIT 10.16(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.
Recitals
        1  
 
           
ARTICLE I: Definitions — Exhibits        
1.01
  Attachments to Lease and Exhibits     1  
1.02
  Definitions     1  
 
           
ARTICLE II: Premises — Term — Options — Covenant of Title        
2.01
  Lease of Premises     2  
2.02
  Term of Lease     2  
2.03
  Option to Extend Lease Term     3  
2.04
  Covenant of Title     3  
 
           
ARTICLE III: Use of Premises        
3.01
  Use     4  
 
           
ARTICLE IV: Rent        
4.01
  Base Rent / Minimum Monthly Rent     4  
4.02
  Percentage Rent     4  
4.03
  Rent Payments     5  
4.04
  Place for Payment of Rent     5  
4.05
  Late Payment of Rent     5  
 
           
ARTICLE V: Taxes, Assessments and Utilities        
5.01
  Impositions     5  
5.02
  Proration of Taxes     6  
5.03
  Exceptions from Impositions; Charges in Lieu of Impositions     6  
5.04
  Contest of Taxes     6  
5.05
  Utilities     7  
5.06
  Personal Property Taxes     7  
 
           
ARTICLE VI: Insurance        
6.01
  Acquisition of Insurance Policies     7  
6.02
  Types of Required Insurance     7  
6.03
  Terms of Insurance     8  
6.04
  Landlord’s Acquisition of Insurance     8  
6.05
  Insurance Money and Other Funds Held In Trust     8  
6.06
  Application or Proceeds of Physical Damage Insurance     8  
6.07
  Cooperation for Insurance Proceeds     9  
6.08
  Waiver of Right of Recovery     9  
 
           
ARTICLE VII: Maintenance, Repairs And Alterations        
7.01
  Alterations — Changes     9  

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.
7.02
  Repairs — Maintenance     10  
 
           
ARTICLE VIII: Environmental Matters        
8.01
  Definition     10  
8.02
  Tenant’s Responsibilities and Landlord Indemnity     10  
8.03
  Remedial Work     11  
8.04
  Maintenance of Premises     12  
8.05
  Landlord’s Responsibilities and Tenant’s Indemnity     12  
8.06
  Landlord Inspection     13  
8.07
  Effect of Termination     13  
 
           
ARTICLE IX: Improvements        
9.01
  Tenant’s Signs     14  
9.02
  Hold Harmless .     14  
9.03
  Permits; Compliance With Codes     14  
9.04
  Ownership     14  
9.05
  Control     15  
 
           
ARTICLE X: Indemnity        
10.01
  Indemnification     15  
 
           
ARTICLE XI: Assignment and Subletting        
11.01
  Assignment and Subletting     15  
11.02
  Notice to Landlord     16  
 
           
ARTICLE XII: Encumbrance of Leasehold Estate        
12.01
  Leasehold Mortgages     16  
 
           
ARTICLE XIII: Mortgage Subordination        
13.01
  Existing Mortgages     16  
13.02
  Future Mortgages     16  
 
           
ARTICLE XIV: Condemnation — Eminent Domain        
14.01
  Definitions     16  
14.02
  Notice to Other Party     17  
14.03
  Total Taking — Effect on Rent and Term     17  
14.04
  Distribution of Award for Taking     17  
14.05
  Partial Taking — Rent Adjustments     18  
14.06
  Partial Taking — Option to Terminate     18  
14.07
  Separate Tenant’s Award     18  
 
           
ARTICLE XV: Default        

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.
15.01
  Tenant’s Default     18  
15.02
  Landlord’s Remedies Cumulative     18  
15.03
  Landlord’s Default     20  
15.04
  Waiver of Redemption     20  
15.05
  Dispute Resolution     20  
15.06
  Attorney Fees     21  
 
           
ARTICLE XVI: Representations and Warranties        
16.01
  Landlord’s Representations and Warranties     21  
16.02
  Tenant’s Representations and Warranties     22  
 
           
ARTICLE XVII: Damage or Destruction        
17.01
  Repairs, Alterations and Further Improvements     22  
17.02
  Prompt Repair     22  
17.03
  Rent Adjustment     23  
 
           
ARTICLE XVIII: Miscellaneous        
18.01
  Limitation on Liability     23  
18.02
  Modification     23  
18.03
  Severability     23  
18.04
  Governing Law     23  
18.05
  Terminology     23  
18.06
  Counterparts     23  
18.07
  Binding Effect     23  
18.08
  Captions     23  
18.09
  Notice to Landlord and Tenant     23  
18.10
  Addresses for Notices to Landlord and Tenant     24  
18.11
  Entire Agreement     24  
18.12
  Sale or Transfer of Premises     24  
18.13
  Force Majeure     25  
18.14
  Waiver     25  
18.15
  Estoppel Certificate     25  
18.16
  Number and Gender     25  
18.17
  No Holding Over     25  
18.18
  Mechanics Liens     25  
18.19
  Relationship of Parties     25  
18.20
  Time of the Essence     26  
18.21
  Facsimile Copies     26  
18.22
  Anti-Merger     26  
 
           
Signature Page     26  

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LEASE
CENTURY THEATRES
Table of Contents
         
        Page No.
Exhibit A
  Description of Premises   A-l
Exhibit B
  Site Plan of Premises   B-l
Exhibit C
  Form of Memorandum   C-l
Exhibit D
  Guaranty of Lease   D-l

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
                         Attached to this Lease and hereby made a part hereof are the following:
                         EXHIBIT A — a description of the Entire Premises.
                         EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red.
                         EXHIBIT C — Form of Memorandum of Lease
                         EXHIBIT D — Guaranty of Lease
     1.02 Definitions.
                         The following terms for purposes of this Lease shall have the meanings hereinafter specified:
                         The term “Commencement Date” shall mean October 1,1995.
                         The term “Effective Date” shall mean October 1, 1995.
                         The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
                         The Term “Initial Rent Due Date” shall mean October 1, 1995.
                         The term “Initial Term” is defined in Section 2.02 herein.
                         The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

1


 

                         The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
                         The term “Number of Term Years” shall mean ***
                         The term “Option Periods” shall mean ***     successive separate periods of ***      each.
                         The term “Percentage Rate” shall mean ***
                         The term “Premises” shall mean the Leased Premises.
                         The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
                         The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
                         The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES-TERM-OPTIONS-COVENANT OF TITLE
     2.01 Lease of Premises.
               A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
               B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
               C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
               A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***       thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
               A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***      consecutive additional periods of: ***      each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
               B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
               C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
                    (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
                    (2) Compliance with the following procedure for exercising the option in question:
                         (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                         (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
                    (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
                    (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted a non-exclusive easement for parking and ingress and egress on and over the Entire Premises. Tenant is responsible for all costs associated with the Entire Premises exclusive of Landlord’s Building. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***          The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***          after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***          Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***           Lease Year and on the first day of each ***            Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Las Vegas, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***          greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***           of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
     Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord..
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations-Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up,containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without Limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however . Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
     15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise hereto provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section rifles or captions contained hereto are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
                    A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
                    B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of mist, or ground or underlying lessor, Tenant shall give such party notice of any default by landlord hereunder by certified or private express mail carrier.

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                    C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco,CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default ff such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no fight to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
                    A) Terminate any existing subleases or subtenancies; or
                    B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
By: /s/ Joseph Syufy
Print Name: Joseph Syufy
Title: V.P.
LANDLORD:
SYUFY ENTERPRISES
a California Limited Partnership
By: /s/ Raymond W. Syufy
Print Name: Raymond Syufy
Title: [ILLEGIBLE]

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EXHIBIT 10.16(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
          This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
          WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Redwood City, California; and
          WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
          WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
          WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
          NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
           A.      Consumer Price Index
          The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
               Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***                                    of the Minimum Monthly Rent payable before the adjustment date in question.
           B.      Gross Sales
          The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
               Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shalI exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
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imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
           C.       Insurance
          The reference in Section 6.03(D) to a Bests rating of“A-” is hereby deleted and in its place inserted a Bests rating of“A-/VII.”
           D.      Alterations
          The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
               If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
           E.      Indemnity and Hold Harmless
          The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
           F.      Assignment
          The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
           G.       Surrender
          After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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               Alternatively, Landlord may elect in its sole and absolute, discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
          This First Amendment to Lease is hereby executed and shall be effective as of date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
             
SYUFY ENTERPRISES, L.P.
“Landlord”
      CENTURY THEATRES, INC.
“Tenant”
   
 
           
/s/ Raymond W. Syufy
 
Raymond W. Syufy
      /s/ Joseph Syufy
 
Joseph Syufy
   
Chief Executive Officer
      President    
[STAMP]
Redwood City

 

 

EXHIBIT 10.16(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment to Lease
           This Second Amendment to Lease (this “ Amendment ”) dated April 15, 2005 is executed by and between Syufy Enterprises , L.P., a California limited partnership (“ Landlord ”) and Century Theatres, Inc., a California corporation (“ Tenant ”).
WlTNESSETH:
           Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at Century 12 Park Redwood, 557 E. Bayshore, Redwood City, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
           Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres ( DE )”), succeeded Century Theatres of California, Inc., as Tenant; and
           Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
           Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
           Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
           Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
           Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A.      Abatement of Rent
          From and after the date the movie theatre operated by Tenant and located *** in downtown Redwood City (the “Downtown Theater”) opens for business (the “Opening Date ”), Tenant’s obligation to pay Rent shall abate for the Term of the Lease; provided, however, that (i) Tenant shall at all times operate a first-class motion picture theatre showing only first-run films at the Premises, and (ii) Tenant shall not be in default under the Lease.
B.       Termination Right Upon Downtown Theater Opening
          From and after the Opening Date, Landlord may but shall not be obligated to terminate the Lease by delivering written notice (the “Termination Notice ”) to Tenant indicating the desired termination date (the “Termination Date”); provided, however, that if after the Opening Date Landlord has, in the exercise of reasonable diligence, executed a new lease for the Entire Premises and has obtained all necessary and appropriate entitlements and final approvals from all
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governmental or quasi-governmental authorities for the particular use contemplated by the new lease, and the appeal periods for all such entitlements and approvals have expired without the filing of an appeal, or if an appeal has been filed, such appeal has been resolved to Landlord’s sole satisfaction, Landlord shall be obligated to terminate the Lease and the Termination Date shall be the date on which all of the aforesaid conditions have, in Landlord’s sole and absolute discretion, been satisfied. If Landlord delivers a Termination Notice to Tenant as set forth above, then, as of the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, with the exception of any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C.      Landlord’s Right to Develop
          1. The second sentence of Section 2.01 (a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include the right to develop at least two (2) retail pads anywhere in the Entire Premises, subject to Landlord’s ability to provide sufficient additional parking to satisfy applicable governmental requirements, and all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
          2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
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D.       Surrender
          Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’ s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’ s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
E.      Miscellaneous
          1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
          2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
          3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
          4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
          5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
          6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Redwood City 12 — Redwood City, California

3


 

           In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
a California limited partnership
“Landlord”
      Century Theatres, Inc.,
a California corporation
“Tenant”
   
 
           
/s/ Raymond Syufy
 
Raymond Syufy,
Chief Executive Officer
      /s/ Joseph Syufy
 
Joseph Syufy,
Chief Executive Officer
   
Redwood City 12 — Redwood City, California

4

 

EXHIBIT 10.16(d)
Third Amendment to Lease
           This Third Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Enterprises , L.P., a California limited partnership (“Landlord”) and Century Theatres, Inc ., a California corporation (“Tenant”).
Witnesseth:
           Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “Premises”) located at Century 12 Park Redwood, 557 E. Bayshore, Redwood City, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
           Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”), succeeded Century Theatres of California, Inc., as Tenant; and
           Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
           Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
           Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
           Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
           Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A.      Surrender; No Demolition Obligation
          Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B.      Miscellaneous
          1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
Redwood City 12 — Redwood City, California

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          2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
          3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
          4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
          5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
          6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
           In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
a California limited partnership
“Landlord”
      Century Theatres, Inc.,
a California corporation
“Tenant”
   
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
Raymond Syufy,
Chief Executive Officer
     
 
Joseph Syufy,
Chief Executive Officer
   
Redwood City 12 — Redwood City, California

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EXHIBIT 10.16(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Redwood City 12)
           THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”)is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
          A. Landlord and Century Theatres of California, Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Redwood City, California.
          B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
          C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Amended Lease.
          D. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
           NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Amended Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
          1. Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
          2. Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
          3. Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease, the current Term of the Lease shall expire on the date that is *** after the Effective Date hereof. Thereafter, Tenant shall not have any options to

 


 

renew or extend the Term of this Lease.
          4. Operating Condition. Tenant covenants and agrees to continuously operate and regularly open the Leased Premises for business to the general public as a first-run motion picture theatre complex in accordance with the Lease, at least on such days and at such times that either the Nearby Theatre is open and operating or a majority of Century’s and Cinemark’s other first-run motion picture theatre complexes in the County of San Mateo typically are open and operating, subject to Excused Closures (defined below). (Tenant’s obligations under this Section 4 are referred to herein as the “Operating Condition.”)***. As used herein, “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty), provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its best efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
          5. Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.
          6. Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
(A) If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals

 


 

for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
          (B) If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date and if the cost to repair such damage or to restore the Leased Premises as required in subsection (A) exceeds twenty percent (20%) of the replacement cost of the Lease Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion), then (i) Tenant may elect, upon notice to Landlord not later than thirty (30) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises as provided in subsection (A) (provided, however, that Landlord may nullify Tenant’s election not to undertake the repairs and restoration, within 30 days after receiving Tenant’s notice, by confirming either (x) that Landlord shall reimburse Tenant for such excess costs within thirty (3) days after the completion of the repairs and restoration and Landlord’s receipt of reasonable supporting documentation of such costs, or (y) that Landlord waives it right to terminate this Lease pursuant to Section 17 prior to the date which is 12 months after the repairs and restoration are completed), and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
          7. Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.

 


 

No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
          8. Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l”.
          9. [Intentionally Omitted.]
          10. Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
          “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and

 


 

other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
          11. Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’ s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.

 


 

          12. Alterations by Tenant.
               Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
               Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
          13. Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements entered into after the Effective Date by Landlord and a licensee or lessee regarding Rooftop Equipment provided that such Rooftop Equipment does not interfere with Tenant’s Rooftop Equipment installed pursuant to this Section.
          14. Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class first run motion picture theatre complex (whether operated as a so-called “first-run” theatre and/or an “art house” theatre) in accordance with the Operating Condition. In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second run” or “adult” theater complex.

 


 

          15. Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
          Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
          16. Alternate Rent. As of the Effective Date and if and for so long as Tenant continues to satisfy the Operating Condition (as defined in Section 4 above) (but not during periods of Excused Closure), then in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of real estate taxes or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease), Tenant shall pay to Landlord on a monthly basis an amount equal to *** of Tenant’s Gross Sales, as defined in Section 10 above. Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the prior year, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
          17. Early Termination — Landlord. Landlord shall have the right, at anytime after the Effective Date of this Amendment, to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.
          18. ***

 


 

          19. Restrictive Covenant. Landlord covenants and agrees that upon the termination of the Lease for any reason other than the default of the Tenant, no portion of the Entire Premises including the Leased Premises shall be used as a motion picture theater complex for a period of 20 years. The terms and provisions of this Section shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after the request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the cost of all such recording fees.
          20. California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
          21. Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
          “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord

 


 

may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
               (A) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
               (B) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
               (C) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
               (D) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
               (E) for any other sums due.”
          22. Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
          (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.

 


 

               (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
               (c) Addresses for Notices to Landlord and Tenant.
               Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention:President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
203 North LaSalle
Suite 1900
Chicago, IL 60601
Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
c/o Cinemark, Inc.
3900 Dallas Parkway
Suite 500
Piano, TX 75093
Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
          23. Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by

 


 

Landlord at this location, which include the premises leased hereby.The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
          24. Prior Amendments. All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph Econcerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Second Amendment and Third Amendment in their entirety.
          25. Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

           IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
             
Landlord:        
 
           
SYUFY ENTERPRISES, L.P., a California limited partnership    
 
           
 
  By:   /s/ Joseph Syufy
 
   
 
  Name:    
 
   
 
  Title:        
 
     
 
   
Tenant:        
 
           
CENTURY THEATRES, INC., a California corporation    
 
           
 
  By:   /s/ Raymond Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           

 


 

EXHIBIT “A-2”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
  

 

EXHIBIT 10.17(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
Recitals
        1  
 
           
ARTICLE I: Definitions — Exhibits        
          1.01
  Attachments to Lease and Exhibits     1  
          1.02
  Definitions     1  
 
           
ARTICLE II: Premises — Term — Options — Covenant of Title        
          2.01
  Lease of Premises     2  
          2.02
  Term of Lease     2  
          2.03
  Option to Extend Lease Term     3  
          2.04
  Covenant of Title     3  
 
           
ARTICLE III: Use of Premises        
          3.01
  Use     4  
 
           
ARTICLE IV: Rent        
          4.01
  Base Rent / Minimum Monthly Rent     4  
          4.02
  Percentage Rent     4  
          4.03
  Rent Payments     5  
          4.04
  Place for Payment of Rent     5  
          4.05
  Late Payment of Rent     5  
 
           
ARTICLE V. Taxes, Assessments and Utilities        
          5.01
  Impositions     5  
          5.02
  Proration of Taxes     6  
          5.03
  Exceptions from Impositions; Charges in Lieu of Impositions     6  
          5.04
  Contest of Taxes     6  
          5.05
  Utilities     7  
          5.06
  Personal Property Taxes     7  
 
           
ARTICLE VI: Insurance        
          6.01
  Acquisition of Insurance Policies     7  
          6.02
  Types of Required Insurance     7  
          6.03
  Terms of Insurance     8  
          6.04
  Landlord’s Acquisition of Insurance     8  
          6.05
  Insurance Money and Other Funds Held In Trust     8  
          6.06
  Application or Proceeds of Physical Damage Insurance     8  
          6.07
  Cooperation for Insurance Proceeds     9  
          6.08
  Waiver of Right of Recovery     9  
 
           
ARTICLE VII: Maintenance, Repairs And Alterations        
          7.01
  Alterations — Changes     9  

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
          7.02
  Repairs — Maintenance     10  
 
           
ARTICLE VIII: Environmental Matters        
          8.01
  Definition     10  
          8.02
  Tenant’s Responsibilities and Landlord Indemnity     10  
          8.03
  Remedial Work     11  
          8.04
  Maintenance of Premises     12  
          8.05
  Landlord’s Responsibilities and Tenant’s Indemnity     12  
          8.06
  Landlord Inspection     13  
          8.07
  Effect of Termination     13  
 
           
ARTICLE IX: Improvements        
          9.01
  Tenant’s Signs     14  
          9.02
  Hold Harmless     14  
          9.03
  Permits; Compliance With Codes     14  
          9.04
  Ownership     14  
          9.05
  Control     15  
 
           
ARTICLE X: Indemnity        
          10.01
  Indemnification     15  
 
           
ARTICLE XI: Assignment and Subletting        
          11.01
  Assignment and Subletting     15  
          11.02
  Notice to Landlord     16  
 
           
ARTICLE XII: Encumbrance of Leasehold Estate        
          12.01
  Leasehold Mortgages     16  
 
           
ARTICLE XIII: Mortgage Subordination        
          13.01
  Existing Mortgages     16  
          13.02
  Future Mortgages     16  
 
           
ARTICLE XIV: Condemnation — Eminent Domain        
          14.01
  Definitions     16  
          14.02
  Notice to Other Party     17  
          14.03
  Total Taking — Effect on Rent and Term     17  
          14.04
  Distribution of Award for Taking     17  
          14.05
  Partial Taking — Rent Adjustments     18  
          14.06
  Partial Taking — Option to Terminate     18  
          14.07
  Separate Tenant’s Award     18  
 
           
ARTICLE XV: Default        

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
          15.01
  Tenant’s Default     18  
          15.02
  Landlord’s Remedies Cumulative     18  
          15.03
  Landlord’s Default     20  
          15.04
  Waiver of Redemption     20  
          15.05
  Dispute Resolution     20  
          15.06
  Attorney Fees     21  
 
           
ARTICLE XVI: Representations and Warranties        
          16.01
  Landlord’s Representations and Warranties     21  
          16.02
  Tenant’s Representations and Warranties     22  
 
           
ARTICLE XVII: Damage or Destruction        
          17.01
  Repairs, Alterations and Further Improvements     22  
          17.02
  Prompt Repair     22  
          17.03
  Rent Adjustment     23  
 
           
ARTICLE XVIII: Miscellaneous        
          18.01
  Limitation on Liability     23  
          18.02
  Modification     23  
          18.03
  Severability     23  
          18.04
  Governing Law     23  
          18.05
  Terminology     23  
          18.06
  Counterparts     23  
          18.07
  Binding Effect     23  
          18.08
  Captions     23  
          18.09
  Notice to Landlord and Tenant     23  
          18.10
  Addresses for Notices to Landlord and Tenant     24  
          18.11
  Entire Agreement     24  
          18.12
  Sale or Transfer of Premises     24  
          18.13
  Force Majeure     25  
          18.14
  Waiver     25  
          18.15
  Estoppel Certificate     25  
          18.16
  Number and Gender     25  
          18.17
  No Holding Over     25  
          18.18
  Mechanics Liens     25  
          18.19
  Relationship of Parties     25  
          18.20
  Time of the Essence     26  
          18.21
  Facsimile Copies     26  
          18.22
  Anti-Merger     26  
 
           
Signature Page     26  

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
Exhibit A
  Description of Premises     A-1  
Exhibit B
  Site Plan of Premises     B-1  
Exhibit C
  Form of Memorandum     C-1  
Exhibit D
  Guaranty of Lease     D-1  

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Premises.
               EXHIBIT B — a site plan of the Premises.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.

1


 

               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land hereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean *** successive separate periods of *** each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***     thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***     consecutive additional periods of ***     each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***     of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted all of Landlord’s rights in and to the Miracle Center Parking Association. Tenant shall be responsible for all costs, dues, insurance and impositions pertaining to the Miracle Center Parking Association.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***     . The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***     after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***     Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***     Lease Year and on the first day of each ***     Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Los Angeles Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***     greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***     of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of” A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this-lsease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes Listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without Limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of; and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of. Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however. Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof; without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom; applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all: parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.4 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.5 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The parry receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
     15.06 Attorneys’Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs. Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent ( 50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The lability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided a bill, demand statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address (es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
 
     
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sate or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in tide, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Maieure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
     
TENANT:
   
 
   
 
  CENTURY THEATRES OF CALIFORNIA, INC.,
 
  a California Corporation
 
   
 
  By: /s/ Joseph Syufy
 
  Print Name: Joseph Syufy
 
  Title: V.P.
     
   
 
   
LANDLORD:
   
 
   
 
  SYUFY ENTERPRISES
 
  a California Limited Partnership
 
   
 
  By: /s/ Raymond W. Syufy
 
  Print Name: Raymond W. Syufy
 
  Title: G.P.

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EXHIBIT 10.17(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
 
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in North Hollywood, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Los Angeles” is hereby deleted and in its place is inserted the “Los Angeles-Orange County Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than *** of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
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imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01 (B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
             
SYUFY ENTERPRISES, L.P.
      CENTURY THEATRES, INC.    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond W. Syufy
      /s/ Joseph Syufy    
 
           
Raymond W. Syufy
      Joseph Syufy    
Chief Executive Officer
      President    
[STAMP]
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EXHIBIT 10.17(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment” ) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) , and Century Theatres, Inc., a California corporation (“Tenant”) .
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at 12827 Victory Blvd., North Hollywood, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”) , succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and
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advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miracle Center Parking Association
     1. Tenant agrees to pay all costs and expenses associated with, and shall be responsible, at its sole cost and expense, for overseeing, the Miracle Center Parking Association which obligations shall include without limitation the insurance, maintenance and security of the Miracle Center parking garage, the invoicing of adjacent owners and Miracle Center Parking Association members for their share of any costs associated with the Miracle Center garage, and any other bookkeeping and miscellaneous matters necessary and appropriate under the By-Laws of the Miracle Center Parking Association or in accordance with any other agreements or encumbrances affecting the Premises and the Miracle Center garage.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the
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Miracle Center Parking Association. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Miracle Center Parking Association, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Miracle Center Parking Association (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century 8 — North Hollywood, CA

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century 8 — North Hollywood, CA

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EXHIBIT 10.17(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment” ) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and Century Theatres, Inc. , a California corporation ( “Tenant” ).
witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at 12827 Victory Blvd., North Hollywood, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
syufy enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century 8 — North Hollywood, CA

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EXHIBIT 10.17(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(North Hollywood)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS:
     A. Landlord and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in North Hollywood, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), and (ii) that certain Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
      1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
      2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
      3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease, the current Term of the Lease shall expire on the date that is ***                 after the Effective Date hereof. Thereafter, the Term of this Lease shall automatically renew on a ***               basis unless Tenant delivers written notice to Landlord at least sixty

 


 

(60) days prior to the then-current expiration date of the Term that Tenant elects not to extend the Term of the Lease.
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Los Angeles typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section,

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except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the uninsured cost to repair such damage or to restore the Leased Premises (including deductibles) exceeds $50,000, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises (provided, however, that Landlord may nullify Tenant’s election not to undertake the repairs and restoration, within thirty (30) days after receiving Tenant’s notice by confirming either (x) that Landlord shall reimburse Tenant for such excess costs within 30 days after the completion of the repairs and restoration and Landlord’s receipt of reasonable supporting documentation of such costs or (y) that Landlord waives its right to terminate this Lease pursuant to Section 18 prior to the date which is 12 months after the repairs and restoration are completed), and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     7. Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease. No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.

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     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     9.  [Intentionally Omitted] .
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).

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     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
     (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
     (ii) Attributable to the annual inflationary increases in real estate taxes; or
     (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
      12.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall

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deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements existing on the date hereof and any extensions thereof that may be exercised by the licensee or lessee thereunder regarding Rooftop Equipment. The lessee’s or licensee’s under such agreements may unilaterally extend or renew if and to the extent provided under such agreements, but Landlord may not renew or extend such agreements or extend such agreements unilaterally if such systems interfere with the transmission received by Tenant’s Rooftop Equipment installed pursuant to this Section 12.
     14.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex whether operated as a so-called “first run” theatre and/or an “art house” theatre. In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second-run” theatre complex or a so-called “adult” theater complex.
     15.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said

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expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine
     16.  Alternate Rent . As of the Effective Date and if and for so long as Tenant continues to satisfy the Operating Condition (defined in Section 4 above), then in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of real estate taxes or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease), Tenant shall pay to Landlord on a monthly basis an amount equal to ***      of Tenant’s Gross Sales, as defined in Section 10 above. Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the prior year, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     17.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     18.  Early Termination — Tenant . (i) If, during any consecutive twelve (12) calendar month period after the Effective Date (the “Test Period”), the TLCF (defined on Exhibit “A-2” hereto) for the Leased Premises is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Test Period, to terminate the Lease as provided below in this Section; provided , however, that such notice and Tenant’s right to terminate the Lease as provided in this Section shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined in Section 4 above) continuously throughout the Test Period. In order to be effective, Tenant’s notice to Landlord under this Section shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice.

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     (ii) If, at anytime during which Tenant is paying Alternate Rent, Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased Premises in excess of *** which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that (1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) exceed ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 19 below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 19 below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
     Notwithstanding anything to the contrary set forth in the Lease, including Section 15 above, if Tenant elects to terminate this Lease pursuant to this Section and Landlord demolishes the theatre building of the Leased Premise within twelve (12) months after the date of termination, then Tenant shall reimburse Landlord for the actual out-of-pocket costs incurred by Landlord to demolish the theatre building (including, without limitation, the costs to remove from the Leased Premises all building materials and debris and all footings, foundations, utility lines and other underground installations that serve the Leased Premises and the costs to restore the surface of the Premises to a graded and landscaped surface); provided, however, that Tenant’s reimbursement obligations shall not exceed an amount equal to the product of *** psf multiplied by the ground floor area of the theatre building (in square feet). Tenant shall pay the amount due under this paragraph within thirty (30) days after receiving Landlord’s written demand for reimbursement, which shall include reasonable supporting documentation confirming the costs so incurred by Landlord. Tenant’s obligations under this paragraph shall expressly survive the termination of the Lease.
     19.  Early Termination — Landlord. Landlord shall have the right, at anytime after the Effective Date of this Amendment, to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.

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     20.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     21. Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”

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     22.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
     
   To Landlord:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President
     
with a copy to:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: General Counsel
 
   
and a copy to:
  DLA Piper
 
  203 North LaSalle
 
  Suite 1900

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  Chicago, IL 60601
 
  Attention: David Sickle, Esq.
     
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Plano, TX 75093
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     23.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     24.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment is hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment in its entirety.
     25.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           

 


 

EXHIBIT “A-2”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
 A-2-1 

 

EXHIBIT 10.18(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent /Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions Proration of Taxes
    6  
5.03 Omitted
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs-Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

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LEASE
CENTURY THEATRES
Table of Contents
     
    Page No.
Exhibit A   Description of Premises.
  A-1
Exhibit B   Site Plan of Premises.
  B-1
Exhibit C   Form of Memorandum.
  C-1
Exhibit D   Guaranty of Lease.
  D-1

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LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
          Attached to this Lease and hereby made a part hereof are the following:
          EXHIBIT A — a description of the Entire Premises.
          EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red..
          EXHIBIT C — Form of Memorandum of Lease
          EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
          The following terms for purposes of this Lease shall have the meanings hereinafter specified:
          The term “Commencement Date” shall mean October 1, 1995.
          The term “Effective Date” shall mean October 1, 1995.
          The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
          The Term “Initial Rent Due Date” shall mean October 1, 1995.
          The term “Initial Term” is defined in Section 2.02 herein.
          The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

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          The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
          The term “Number of Term Years” shall mean ***.
          The term “Option Periods” shall mean *** successive separate periods of *** each.
          The term “Percentage Rate” shall mean ***.
          The term “Premises” shall mean the Leased Premises.
          The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
          The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
          The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS – COVENANT OF TITLE
   2.01 Lease of Premises.
     A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
     B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
     C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
   2.02 Term of Lease.
     A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate *** thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
  2.03 Option to Extend Lease Term.
     A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of *** each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the *** of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
     B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
     C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
          (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
          (2) Compliance with the following procedure for exercising the option in question:
               (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
               (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
          (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
  2.04 Covenant of Title; Authority and Quiet Possession: Transfer of Title.
          (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant shall be subject to, responsible for all costs and granted all rights to the Reciporcal Parking Agreement covering the Entire Premises. Additionally Tenant shall be subject to, responsible for all costs and granted all rights to the Easement Agreement with Tanforan Associates.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***. The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every *** after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the *** Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the *** Lease Year and on the first day of each *** Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco-Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than *** greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any other items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which are assessed on any Buildings exclusive of the Entire Premises, Tenant shall pay all such impositions. With respect to Impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election, Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be. In the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Leased Premises located on the Entire Premises.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’s buildings.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

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ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of Landlord’s Buildings), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (Landlord’s Buildings excluded), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood, but including Builders Risk, to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.

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     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6,06 hereof; and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
                (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
                (2) Second, any remainder shall be paid to Landlord..
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate often percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
     ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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                (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits: Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
                (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
                (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
                (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
                (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
                (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
                (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
                (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payments) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to § 1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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                (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
                (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
                (3) The deposition of the claimants(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the parry against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant

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     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other parry (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
             
TENANT:
           
 
           
    CENTURY THEATRES OF CALIFORNIA, INC.,    
    a California Corporation    
 
           
 
  By:   /s/ Joseph Syufy    
 
           
 
  Print Name:   Joseph Syufy    
 
  Title:   V. P.    
 
           
LANDLORD:
           
 
           
    SYUFY ENTERPRISES    
    a California Limited Partnership    
 
           
 
  By:   /s/ Raymond W. Syufy    
 
           
 
  Print Name:   Raymond W. Syufy    
 
  Title:   G. P.    

26

 

EXHIBIT 10.18(b)
FIRST AMENDMENT TO LEASE
     This first amendment to lease dated October 31, 1996 is executed by and between Syufy Enterprises, a California Limited Partnership, hereinafter called “Landlord” and Century Theatres of California, Inc., a California corporation, hereinafter called “Tenant”.
WITNESSETH:
     WHEREAS, Syufy Enterprises and Century Theatres of California, Inc. entered into an Indenture of Lease on September 30, 1995, hereinafter referred to as the “Lease”, for the Century Plaza Theatre, South San Francisco, California, and
     WHEREAS, the parties hereto desire to amend said Lease as hereinafter provided,
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
     1. The Leased Premises shall be increased by 10,500 square feet as set forth in the attached Exhibit A to permit Tenant to add two additional auditoriums to the existing theatre building.
     2. The Entire Premises as set forth in the Lease and Exhibit A to the Lease shall be replaced by Exhibit A attached and shall represent the revised Entire Premises.
     3. Tenant shall be granted all rights to the Revised Reciprocal Parking Agreement covering the revised Entire Premises. Tenant shall be responsible for all of Landlord’s costs as set forth in the Revised Reciprocal Parking Agreement. Landlord shall be responsible for the Real Property Taxes pertaining to any building erected by Landlord on the site designated “Future Commercial Building” as set forth on Exhibit A attached.
     4. Tenant shall be responsible for all construction costs of the additional auditoriums as well as Landlord’s share of all improvements to the revised Entire Premises for additional parking, site preparation as well as for the installation of all utilities and drainage serving the revised Entire Premises.
     5. As consideration for the costs incurred in 3 and 4 of this amendment, Tenant shall not pay any additional rent to Landlord for the additional Leased Premises as set forth in 1 above.
     Executed as of the date first written above.
         
Century Theatres of California, Inc.
      Syufy Enterprises
 
       
/s/ Joseph Syufy
      /s/ Raymond W. Syufy
 
       
Joseph Syuty, Vice President
      Raymond W. Syufy, G P

 

 

EXHIBIT 10.18(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
SECOND AMENDMENT TO LEASE
     This Second Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in South San Francisco, California; and
     WHEREAS, Landlord and Tenant entered into that certain First Amendment to Lease dated October 31, 1996; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to further amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be further amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***      of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending
Plaza So. San Francisco

 


 

machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01 (A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
Plaza So. San Francisco

 


 

      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This Second Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
         
SYUFY ENTERPRISES, L.P.
      CENTURY THEATRES, INC.
“Landlord”
      “Tenant”
 
       
/s/ Raymond W. Syufy
      /s/ Joseph Syufy
 
       
Raymond W. Syufy
      Joseph Syufy
Chief Executive Officer
      President
[STAMP]
Plaza So. San Francisco

 

 

EXHIBIT 10.18(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres, Inc., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated October 31, 1996, between Landlord and Century Theatres of California, Inc., a California corporation, and as further amended by that certain Second Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease”), for a motion picture building and related parking (the “Premises”) located at Century Plaza, 410 Noor Avenue, So. San Francisco, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Right to Terminate
     At any time on or after the date the movie theatre operated by Tenant and located at ***                 (also known as the ***               ) opens for business, either Landlord or Tenant may terminate the Lease by delivering written notice (the “Termination Notice” ) to the other party, indicating the date on which the Lease shall terminate (the “Termination Date”). If either party delivers a Termination Notice to the other party as set forth above, then, as of the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, with the exception of any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
Century Plaza 10 — So. San Francisco, California

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B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “ FF&E ”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
Century Plaza 10 — So. San Francisco, California

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D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century Plaza 10 — So. San Francisco, California

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
syufy enterprises, L.P.,
      Century Theatres, Inc.,
a California limited partnership
      a California, corporation
“Landlord”
      “Tenant”
 
       
/s/ Raymond Syufy
      /s/ Joseph Syufy
 
       
Raymond Syufy,
      Joseph Syufy,
Chief Executive Officer
      Chief Executive Officer
Century Plaza 10 — So. San Francisco, California

4

 

EXHIBIT 10.18(e)
Fourth Amendment to Lease
      This Fourth Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated October 31, 1996, between Landlord and Century Theatres of California, Inc., a California corporation, and as further amended by that certain Second Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Third Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease”), for a motion picture building and related parking (the “Premises”) located at Century Plaza, 410 Noor Avenue, So. San Francisco, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings
Century Plaza 10 — So. San Francisco, California

1


 

between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,
a California limited partnership
      a California corporation
“Landlord”
      “Tenant”
 
       
/s/ Raymond Syufy
      /s/ Joseph Syufy
 
       
Raymond Syufy,
      Joseph Syufy,
Chief Executive Officer
      Chief Executive Officer
Century Plaza 10 — So. San Francisco, California

2

 

EXHIBIT 10.18(f)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FIFTH AMENDMENT TO LEASE
(South SF 10)
      THIS FIFTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS:
     A. Landlord (then known as Syufy Enterprises (“Original Landlord”)) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in San Francisco, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of October 31, 1996 (the “First Amendment”), (ii) Second Amendment to Lease dated as of September 1, 2000 (the “Second Amendment”), (iii) Third Amendment to Lease dated as of April 15, 2005 (the “Third Amendment”), and (iv) Fourth Amendment to Lease dated as of September 29, 2005 (the “Fourth Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the

1


 

Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***      and rather than ***    Renewal Terms of ***    each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***   consecutive Renewal Terms of ***     each, followed by ***     additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of San Francisco typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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     6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly

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owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     9.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x)

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the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premises, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters

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identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant.
          Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
          Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theatre complex. Tenant shall be required to complete all alterations, improvements or changes that Tenant undertakes. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:

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  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second run” theatre complex or a so-called “adult” theater complex.

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     16.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  Early Termination — Opening of Nearby Theatre. As of the Effective Date hereof, Tenant is the lessee under a lease agreement (the “Nearby Theatre Lease”) for the motion picture theatre complex located or to be located at the proposed “***” in San Bruno, California (the “Nearby Theatre”). As of the date the Nearby Theater opens for business to the public, the Lease shall be terminated.
     18.  Early Termination — Cancellation of Nearby Theatre Lease. In the event, during any consecutive twelve (12) calendar month period from the Effective Date (the “Test Period”), the Nearby Theatre is not constructed and open for business to the general public, and if the Theatre Level Cash Flow (“TLCF”), as defined in Exhibit “A-3” hereto, for the Leased Premises over the Test Period is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the TLCF for the most current trailing twelve (12) month period was *** or forty-five (45) days after the expiration of such Test Period, to terminate the Lease as provided below in this Section 18; provided , however, that Tenant shall have concurrently or previously terminated the Nearby Theatre Lease; and provided further, that such notice and Tenant’s right to terminate the Lease for the applicable Test Period shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined above) continuously throughout the applicable Test Period subject to Excused Closure. Further, in order to be effective, Tenant’s notice to Landlord under this Section 18 shall include a written “certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the Test Period calculated in accordance with Tenant’s normal accounting practices is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice of the Test Period.
     19.  Restrictive Covenant. Landlord covenants and agrees that if, upon the termination of the Lease for any reason, other than the default of Tenant, Tenant or an affiliate of Tenant is leasing and operating a Nearby Theater pursuant to the Nearby Theater Lease, then no portion of the Entire Premises including the Leased Premises shall be used or operated as a motion picture theater complex prior to the date which is the first to occur of (i) 15 years from

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the date that the Nearby Theater is or was first open to the general public and operated as a motion picture theater complex or (ii) the termination or expiration of the Nearby Theater Lease or (iii) the Nearby Theater ceasing to be open to the public and operating as a first-run motion picture theater complex, for reasons other than Excused Closures for a continuous period of eighteen (18) months or more. The terms and provisions of the Section shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the costs of all such recording fees.
     20.  California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     21.  Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;

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     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     22.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
  (a)   Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
 
  (b)   Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
 
  (c)   Addresses for Notices to Landlord and Tenant.

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     Notices are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President
 
   
with a copy to:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: General Counsel
 
   
and a copy to:
  DLA Piper
 
  203 North LaSalle
 
  Suite 1900
 
  Chicago, IL 60601 94901
 
  Attention: David Sickle, Esq.
 
   
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Piano, TX 75093
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     23.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     24.  Prior Amendments. All of the provisions of the Second Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Third Amendment and the Fourth Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Third Amendment and Fourth Amendment in their entirety.
     25.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further

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amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
                 
Landlord:        
 
               
SYUFY ENTERPRISES, L.P., a California limited partnership    
 
               
 
  By:   /s/ Joseph Syufy        
                 
 
  Name:            
                 
 
  Title:            
                 
 
               
Tenant:        
 
               
CENTURY THEATRES, INC., a California corporation    
 
               
 
  By:   /s/ Raymond W. Syufy        
                 
 
  Name:            
                 
 
  Title:            
                 

 


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
 A3-1 

 

EXHIBIT 10.19(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.
Recitals     l  
 
           
ARTICLE I: Definitions — Exhibits        
1.01
  Attachments to Lease and Exhibits     1  
1.02
  Definitions     l  
 
           
ARTICLE II: Premises — Term — Options — Covenant of Title        
2.01
  Lease of Premises     2  
2.02
  Term of Lease     2  
2.03
  Option to Extend Lease Term     3  
2.04
  Covenant of Title     3  
 
           
ARTICLE III: Use of Premises        
3.01
  Use     4  
 
           
ARTICLE IV: Rent        
4.01
  Base Rent / Minimum Monthly Rent     4  
4.02
  Percentage Rent     4  
4.03
  Rent Payments     5  
4.04
  Place for Payment of Rent     5  
4.05
  Late Payment of Rent     5  
 
           
ARTICLE V: Taxes, Assessments and Utilities        
5.01
  Impositions     5  
5.02
  Proration of Taxes     6  
5.03
  Exceptions from Impositions; Charges in Lieu of Impositions     6  
5.04
  Contest of Taxes     6  
5.05
  Utilities     7  
5.06
  Personal Property Taxes     7  
 
           
ARTICLE VI: Insurance        
6.01
  Acquisition of Insurance Policies     7  
6.02
  Types of Required Insurance     7  
6.03
  Terms of Insurance     8  
6.04
  Landlord’s Acquisition of Insurance     8  
6.05
  Insurance Money and Other Funds Held In Trust     8  
6.06
  Application or Proceeds of Physical Damage Insurance     8  
6.07
  Cooperation for Insurance Proceeds     9  
6.08
  Waiver of Right of Recovery     9  
 
           
ARTICLE VII: Maintenance, Repairs And Alterations        
7.01
  Alterations – Changes     9  


 

LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.
7.02
  Repairs — Maintenance     10  
 
           
ARTICLE VIII: Environmental Matters        
8.01
  Definition     10  
8.02
  Tenant’s Responsibilities and Landlord Indemnity     10  
8.03
  Remedial Work     11  
8.04
  Maintenance of Premises     12  
8.05
  Landlord’s Responsibilities and Tenant’s Indemnity     12  
8.06
  Landlord Inspection     13  
8.07
  Effect of Termination     13  
 
           
ARTICLE IX: Improvements        
9.01
  Tenant’s Signs     14  
9.02
  Hold Harmless     14  
9.03
  Permits; Compliance With Codes     14  
9.04
  Ownership     14  
9.05
  Control     15  
 
           
ARTICLE X: Indemnity        
10.01
  Indemnification     15  
 
           
ARTICLE XI: Assignment and Subletting        
11.01
  Assignment and Subletting     15  
11.02
  Notice to Landlord     16  
 
           
ARTICLE XII: Encumbrance of Leasehold Estate        
12.01
  Leasehold Mortgages     16  
 
           
ARTICLE XIII: Mortgage Subordination        
13.01
  Existing Mortgages     16  
13.02
  Future Mortgages     16  
 
           
ARTICLE XIV: Condemnation — Eminent Domain        
14.01
  Definitions     16  
14.02
  Notice to Other Party     17  
14.03
  Total Taking — Effect on Rent and Term     17  
14.04
  Distribution of Award for Taking     17  
14.05
  Partial Taking — Rent Adjustments     18  
14.06
  Partial Taking — Option to Terminate     18  
14.07
  Separate Tenant’s Award     18  
 
           
ARTICLE XV: Default        

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.
15.01
  Tenant’s Default     18  
15.02
  Landlord’s Remedies Cumulative     18  
15.03
  Landlord’s Default     20  
15.04
  Waiver of Redemption     20  
15.05
  Dispute Resolution     20  
15.06
  Attorney Fees     21  
 
           
ARTICLE XVI: Representations and Warranties        
16.01
  Landlord’s Representations and Warranties     21  
16.02
  Tenant’s Representations and Warranties     22  
 
           
ARTICLE XVII: Damage or Destruction        
17.01
  Repairs, Alterations and Further Improvements     22  
17.02
  Prompt Repair     22  
17.03
  Rent Adjustment     23  
 
           
ARTICLE XVIII: Miscellaneous        
18.01
  Limitation on Liability     23  
18.02
  Modification     23  
18.03
  Severability     23  
18.04
  Governing Law     23  
18.05
  Terminology     23  
18.06
  Counterparts     23  
18.07
  Binding Effect     23  
18.08
  Captions     23  
18.09
  Notice to Landlord and Tenant     23  
18.10
  Addresses for Notices to Landlord and Tenant     24  
18.11
  Entire Agreement     24  
18.12
  Sale or Transfer of Premises     24  
18.13
  Force Majeure     25  
18.14
  Waiver     25  
18.15
  Estoppel Certificate     25  
18.16
  Number and Gender     25  
18.17
  No Holding Over     25  
18.18
  Mechanics Liens     25  
18.19
  Relationship of Parties     25  
18.20
  Time of the Essence     26  
18.21
  Facsimile Copies     26  
18.22
  Anti – Merger     26  
 
           
Signature Page     26  

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LEASE
CENTURY THEATRES
Table of Contents
         
        Page No.
Exhibit A
  Description of Premises   A-l
Exhibit B
  Site Plan of Premises   B-l
Exhibit C
  Form of Memorandum   C-l
Exhibit D
  Guaranty of Lease   D-l

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LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Premises.
               EXHIBIT B — a site plan of the Premises.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.

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               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean ***       successive separate periods of ***        each.
               The term “Percentage Rate” shall mean***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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     The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to***       consecutive additional periods of ***      each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of***      . The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***       Lease Year and on the first day of each ***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco-Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***      greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by ***      which of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in feet so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

6


 

contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attomey’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event die party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of tins Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively, they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the dale of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for hiens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs. Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously cany out such repair, replacement, reconstruction or rebuilding, to.full completion as soon as possible, except to the extent of delays due to strikes, lookouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot act of God, act of the public enemy, or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (retrun receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn: Real Estate Department
 
   
To Tenant:
  Century Theatres of California, Inc.
 
  150 Golden Gate Avenue
 
  San Francisco, CA 94102
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises, of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for Liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Maieure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics hens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics hens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
By: /s/ Joseph Syufy                                      
Print Name: Joseph Syufy
Title: V.P.
LANDLORD:
SYUFY ENTERPRISES
a California Limited Partnership
By: /s/ Raymond W. Syufy                           
Print Name: Raymond W. Syufy
Title: G.P.

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EXHIBIT 10.19(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Fremont, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***                        of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Fremont

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01 (A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
Fremont

 


 

     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.
“Landlord”
  “Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
[STAMP]
Fremont

 

 

EXHIBIT 10.19(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment To Lease
      This Second Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30,1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease”), for a motion picture building and related parking (the “Premises”) located at Cinedome Fremont, 39153 Farwell Drive, Fremont, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Right to Terminate
     At any time after the date the movie theatre operated by Tenant and located at the *** in Newark opens for business, either Landlord or Tenant may terminate the Lease by delivering written notice (the “Termination Notice” ) to the other party, indicating the date on which the Lease shall terminate (the “Termination Date”). If either party delivers a Termination Notice to the other party as set forth above, then, as of the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, with the exception of any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
Cinedome Fremont — Fremont, California

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B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
Cinedome Fremont — Fremont, California

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D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Cinedome Fremont — Fremont, California

3


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
 
      /s/ Joseph Syufy
 
   
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Cinedome Fremont — Fremont, California

4

 

EXHIBIT 10.19(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment” ) dated September 29, 2005 is executed by and between Syufy Enterprises , L.P., a California limited partnership ( “Landlord” ) and Century Theatres, Inc. , a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Cinedome Fremont, 39153 Farwell Drive, Fremont, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Term and Termination
     The termination provision, as set forth in that certain Second Amendment to Lease, dated April 15, 2005 is hereby deleted and the Initial Term, as set forth in the lease dated September 30, 1995 shall remain unchanged.
B. Annual Rent
Annual Base Rent for the remainder of the Initial Term of the Lease shall be fixed at *** ***       per year, payable monthly as set forth in the Lease.
Cinedome Fremont — Fremont, California

1


 

C. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Cinedome Fremont — Fremont, California

2


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
 
      /s/ Joseph Syufy
 
   
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Cinedome Fremont — Fremont, California

3

 

EXHIBIT 10.19(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Fremont)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, Inc. (the “Original Landlord”)) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Fremont, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligations of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
      1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
      2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.   Annual Rent . Annual Base Rent for the remainder of the Initial Term of the Lease shall be fixed at ***      per year, payable monthly as set forth in the lease.
     4.   Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in Alameda County, California typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.   Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.
     6.   Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the

 


 

repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date as required in subsection (A) hereof, and if the cost to repair such damage or to restore the Leased Premises exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     7.   Permitted Assignments . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease. No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.   Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under

 


 

the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A” .
     9.   Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     10. Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises

 


 

(or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
11. Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and

 


 

ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     12.   Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements existing on the date hereof and any extensions thereof that may be exercised by the licensee or lessee thereunder regarding Rooftop Equipment. The lessee’s or licensee’s under such agreements may unilaterally extend or renew if and to the extent provided under such agreements, but Landlord may not renew or extend such agreements or extend such agreements unilaterally if such systems interfere with the transmission received by Tenant’s Rooftop Equipment installed pursuant to this Section.
     13.   Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex (whether operated as a so-called “first run” theater and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “second-run” theater complex or as a so-called “adult” theater complex.
     14.   Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and such earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.

 


 

     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     15.  Early Termination . As of the Effective Date hereof, Tenant is the lessee under a lease agreement (the “Protected Theater Lease”) for the motion picture theater complex located or to be located at the “***” located in Newark, California (the “Protected Theater”). Tenant is also the lessee under a lease agreement (the “Newark 7 Lease”) for the motion picture theater complex known as the “Newark 7” theater located in Newark, California, pursuant which Tenant shall have the right and option to expand the Newark 7 theater (the “Newark 7 Expansion”) if the lessor under the Protected Theater Lease fails to commence construction of the Protected Theater within *** after the Effective Date.
     At the election of either Landlord or Tenant, upon not less than thirty (30) days prior written notice to the other party, the Lease shall be terminated and the term shall expire if: (i) ***, or (ii) *** or (iii) ***.
     16. Restrictive Covenant . Landlord covenants and agrees that if, upon the termination of the Lease for any reason other than the default of Tenant, Tenant or an affiliate of Tenant is leasing and operating the Protected Theater pursuant to the Protected Theater Lease or Newark 7 pursuant to the Newark 7 Expansion, then no portion of the Entire Premises, including the Leased Premises shall be used or operated as a motion picture theater complex prior to the date which is the first to occur of (i) twenty (20) years from the date that the Protected Theater or the Newark 7 Expansion (whichever opens first) is or was first open to the general public and operated as a motion picture theater complex, or (ii) the termination or expiration of Protected Theater Lease or the Newark 7 Expansion, as the case may be, or (iii) the Protected Theater or Newark 7 Expansion, as the case may be, ceasing to be open to the public and operating as a first run motion picture theater complex, for reasons other than Excused Closure, for a continuous period of eighteen (18) consecutive months or more. The terms and provisions of this Paragraph shall survive the termination of the Lease (except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant). Such restrictive covenants shall run with the land. Landlord agrees to execute within thirty (30) days after request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the cost of all such recording fees.
     17. California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease,

 


 

including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     18. Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (A) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (B) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (C) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (D) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (E) for any other sums due.”
     19. Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered

 


 

personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
Notices are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President
 
   
with a copy to:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: General Counsel
 
   
and a copy to:
  DLA Piper
 
  203 North LaSalle
 
  Suite 1900
 
  Chicago, IL 60601
 
  Attention: David Sickle, Esq.
 
   
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Plano, TX 75093
 
  Attention: Legal Department

 


 

Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     20.   Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     21.   Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Second Amendment and Third Amendment in their entirety.
     22.   Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
By: /s/ Joseph Syufy                    
Name: Joseph Syufy
Title:                                                 
Tenant:
CENTURY THEATRES, INC., a California corporation
By: /s/ Raymond W. Syufy                    
Name: Raymond W. Syufy
Title:                                                           

 

 

EXHIBIT 10.20(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE

CENTURY THEATRES

Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Proration of Taxes
    6  
5.03 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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CENTURY THEATRES

Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII: Encumbrance of Leasehold Estate
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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CENTURY THEATRES

Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

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LEASE

CENTURY THEATRES

Table of Contents
         
      Page No.
Exhibit A
  Description of Premises   A-l
Exhibit B
  Site Plan of Premises   B-l
Exhibit C
  Form of Memorandum   C-l
Exhibit D
  Guaranty of Lease   D-l

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LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
Attached to this Lease and hereby made a part hereof are the following:
EXHIBIT A — a description of the Premises.
EXHIBIT B — a site plan of the Premises.
EXHIBIT C — Form of Memorandum of Lease
EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
The following terms for purposes of this Lease shall have the meanings hereinafter specified:
The term “Commencement Date” shall mean October 1, 1995.
The term “Effective Date” shall mean October 1, 1995.
The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
The Term “Initial Rent Due Date” shall mean October 1, 1995.
The term “Initial Term” is defined in Section 2.02 herein.

1


 

               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***.
               The term “Option Periods” shall mean *** successive separate periods of *** years each.
               The term “Percentage Rate” shall mean ***.
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate *** thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of *** each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the *** of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
(1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
(2) Compliance with the following procedure for exercising the option in question:
                         (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                         (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is property exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title: Authority and Quiet Possession: Transfer of Title.
(A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
ARTICLE IV
     RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***. The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every *** after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the *** Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the *** Lease Year and on the first day of each *** Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco-Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than *** greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Propertv Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal properly taxes levied or assessed against any personal properly located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “ A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all Liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, du ring any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term-Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto if the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be-first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take ail actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily’ maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any outer portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of. Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not,to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
     B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.2 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees. Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.3 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.4 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such Corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, Limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation, or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximatery caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such cither relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
16.01   Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as herein above provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

22


 

reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Maieure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
         
  CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
 
 
  By:   /s/ Joseph Syufy    
  Print Name:   Joseph Syufy     
  Title:   V.P.     
 
LANDLORD:
         
  SYUFY ENTERPRISES
a California Limited Partnership
 
 
  By:   /s/ Raymond W. Syufy    
  Print Name:   Raymond W. Syufy     
  Title:   G.P.     
 

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EXHIBIT 10.20(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Newark, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***        of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Newark

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01 (A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01 (C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01 (B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
Newark

 


 

     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.
“Landlord”
  “Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
 
   
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
[STAMP]
Newark

 

 

EXHIBIT 10.20(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century Theatres, Inc. , a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises”) located at Cinedome Newark, 6000 New Park Mall, Newark, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, together, Landlord, Syufy Properties, Inc., Syaz Properties, Inc. and Syut Properties, Inc. (collectively, the “Shareholders”) own all of the outstanding shares of capital stock of Tenant (the “Shares”) ; and
      Whereas, the Shareholders desire to sell the Shares pursuant to a stock purchase agreement; and
      Whereas, the parties wish to terminate this Lease as of one (1) day prior to the effective date of the sale by the Shareholders of the Shares (the “Closing”) ; and
      Whereas, the parties desire now to amend the Lease as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Termination of Lease; Surrender
     The parties hereby agree that the Lease shall terminate and be of no further force or effect (except as set forth herein) as of one (1) day prior to the Closing (the “Termination Date”) . Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord,
         
    1   Cinedome Newark — Newark, California

 


 

Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on fallowing page]
         
    2   Cinedome Newark — Newark, California

 


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P. ,
  Century Theatres, Inc.
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
         
    3   Cinedome Newark — Newark, California

 

 

EXHIBIT 10.20(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment” ) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and Century Theatres, Inc. , a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at Cinedome Newark, 6000 New Park Mall, Newark, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      whereas, Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      whereas, the parties desire now to amend the Lease as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Term and Termination
     The termination provision, as set forth in that certain Second Amendment to Lease, dated April 15, 2005 is hereby deleted and the Initial Term, as set forth in the lease dated September 30, 1995 shall remain unchanged.
B. Annual Rent
     Annual Base Rent for the remainder of the Initial Term of the Lease shall be fixed at ***        per year, payable monthly as set forth in the Lease.
         
    1   Cinedome Newark — Newark, California

 


 

C. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
         
    2   Cinedome Newark — Newark, California

 


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P. ,
  Century Theatres, Inc.,
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
         
    3   Cinedome Newark — Newark, California

 

 

EXHIBIT 10.20(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Newark)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres of California, Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Newark, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) that certain Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease, the Initial Term of the Lease is hereby extended to and shall expire on ***, but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, and rather than ***      Renewal Terms of ***      each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for***      consecutive Renewal Terms of *** each, followed by ***      additional and final Renewal Term of ***
     4.  Annual Rent. Annual Base Rent for the remainder of the Initial Term of the Lease shall be fixed at ***     per annum, payable monthly as set forth in the Lease.
     5.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Alameda typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     6.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held

 


 

by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.
     7.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (a) Tenant’s Obligation to Repair. If the Leases Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (b) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (b) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (b) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the cost to repair such damage or to restore the Leased Premises as required in subsection (a) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     8.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall

 


 

not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease. No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     9.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l”.
     10.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     11.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without

 


 

limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     12.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premises, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant to on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth (5th anniversary of the Effective Date, and continuing until the tenth (10th) anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is

 


 

treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date.
     13.  Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theatre complex. Tenant shall be required to complete all alterations, improvements and changes undertaken by Tenant. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 5 of this Amendment.
     14.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.

 


 

     15.  Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     16.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre,

 


 

and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     17.  No Obligation To Continuously Operate. Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     18.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     19.  Early Termination — Opening of Nearby Theatre. As of the Effective Date hereof, Tenant is the lessee under a lease agreement (the “Nearby Theatre Lease”) for the motion picture theatre complex located or to be located at the “***” located in Newark, California (the “Nearby Theatre”). The Lease shall automatically terminate and the term shall expire if ***.
     20.  Expansion of Premises if Nearby Theatre is not Developed. If the lessor under the Nearby Theatre Lease does not commence construction of the Nearby Theatre within *** after the Effective Date of this Amendment, then upon notice to Landlord not later than thirty (30) days after the expiration of such *** period, Tenant shall elect either (i) to terminate the Lease, or (ii) to exercise the option (the “Expansion Option”) to expand the Premises to include the *** (the “Expansion Premises”), as depicted on Exhibit B attached hereto. If Tenant fails to notify Landlord of Tenant’s election under this Section 20 on or before the date which is *** after the Effective Date, then Tenant conclusively shall be deemed to have elected to ***. The Expansion Option shall be subject to the following terms and conditions:

 


 

     (a) At the time Tenant notifies Landlord of Tenant’s election to expand the Premises, no material Event of Default by Tenant shall be outstanding beyond the expiration of any applicable notice and cure period, and neither this Lease nor Tenant’s possession of the Premises shall have been terminated. Landlord shall cooperate at Tenant’s sole cost and expense with Tenant in pursuing any necessary or appropriate entitlements to develop the Theatre.
     (b) The Expansion Premises shall be accepted by Tenant in its then-existing “AS-IS” condition (it being expressly understood and agreed by Tenant that *** and otherwise on the terms, conditions, and provisions of this Lease. Tenant shall be solely responsible for the planning, permitting and construction of the Expansion Premises and the associated alterations of the Building, ***. Promptly after exercising the Expansion Option, Tenant shall apply for the entitlements required for the redevelopment of the theatre as contemplated hereunder (the “Expansion Entitlements”), and Tenant shall thereafter diligently and continuously seek to obtain the Expansion Entitlements; provided however that no Expansion Entitlements shall be binding upon Landlord, the Expansion Premises or any other portion of the Premises unless and until Tenant’s termination rights under this Section are waived by Tenant in writing or have lapsed. Tenant shall keep Landlord well informed of Tenant’s efforts to obtain and the status of the Expansion Entitlements. If the Expansion Entitlements are not obtained within *** after Tenant’s exercise of the Expansion Option, and provided that Tenant shall have used good faith, reasonably diligent efforts to obtain the Expansion Entitlements, then Tenant (at Tenant’s election) shall have the right and option to terminate the Lease upon thirty (30) days’ prior written notice, subject to the following terms and conditions: (A) in order to be effective, the termination notice must be given by Tenant to Landlord not later than the first to occur of (x) thirty (30) days after the *** of the date of Tenant’s exercise of the Expansion Option, or (y) thirty (30) days after Tenant ceases to actively and diligently pursue the Expansion Entitlements; (B) if Tenant so terminates the Lease, the Lease shall be terminated in its entirety (as to both the original Premises and the Expansion Premises); and (C) Tenant shall have no further right to terminate the Lease pursuant to this Section if the Expansion Entitlements are issued (or may be obtained by the payment of applicable fees) or if Tenant fails to timely notify Landlord of the termination in accordance with clause (A) above.
     (c) Within days after receipt of entitlements, building permits and letting of construction contracts, Tenant shall commence redevelopment of the Theatre. Prior to commencing any on-site work relative to the Expansion Premises, Tenant shall submit the proposed construction plans for same to Landlord for Landlord’s review and approval, which shall not be unreasonably withheld, delayed or conditioned. Upon completion and opening of any improvements on or to the Expansion Premises (including any expansion of or alterations to the existing Building on the Leased Premises), Tenant shall deliver to Landlord a copy of the so-called “as-built” plans and specifications for such Building improvements. The improvements, work, equipment and materials located upon or incorporated into the Expansion Premises by Tenant shall be deemed to be Tenant’s property.

 


 

     (d) If the Expansion Option is exercised and the Lease is not terminated by Tenant pursuant to subsection (b), then commencing on the ***     of the date Tenant exercised the Expansion Option and thereafter for the remainder of the term of the Lease: (i) the Expansion Premises shall be deemed to be a part of the Leased Premises for all purposes under the Lease, (ii) the Base Rent otherwise due under the Lease shall be increased by ***     per annum ***     and (iii) Tenant shall have no further right to terminate the Lease pursuant to Section 19 above entitled “Early Termination — Opening of Nearby Theatre.”
     (e) If Tenant exercises the Expansion Option, Landlord and Tenant shall either (i) execute a written supplement to the Lease regarding the terms, provisions, and conditions of this Lease applicable to the Expansion Premises or (ii) negotiate in good faith the terms and conditions of a new lease containing the rent specified above and containing an initial term (from the date Tenant exercises the Expansion Option) of ***      renewal options of ***      each and ***      renewal option for ***            and such other terms as the parties may agree.
     (f) Landlord agrees not to install improvements or engage in construction prior to the exercise or lapse of the Expansion Option or encumber the property in any way that frustrates the purpose of the Expansion Option.
     (g) Tenant shall indemnify landlord and the Premises (including the Expansion Premises) from and against any loss, cost, liability, lien, encumbrance, damage or expense that arises out of or in connection with the issuance of, or Tenant’s efforts to obtain the Expansion Entitlements. The terms and provisions of this subsection shall survive the termination of the Lease.
      21.  Restrictive Covenant. Landlord covenants and agrees that if, upon the termination of the Lease for any reason other than the default of Tenant, Tenant or an affiliate of Tenant is leasing and operating the Nearby Theater pursuant to the Nearby Theater Lease, then no portion of the Entire Premises, including the Leased Premises, shall be used or operated as a motion picture theater complex prior to the date which is the first to occur of (i) twenty (20) years from the date that the Nearby Theater is or was first open to the general public and operated as a motion picture theater complex, or (ii) the termination or expiration of Nearby Theater Lease, or (iii) the Nearby Theater ceasing to be open to the public and operating as a first run motion picture theater complex, for reasons other than Excused Closure, for a continuous period of eighteen (18) consecutive months or more. The terms and provisions of this Paragraph shall survive the termination of the Lease (except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenants shall run with the land. Landlord agrees to execute within thirty (30) days after request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the cost of all such recording fees.
      22.  California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to

 


 

possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     23.  Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     24.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:

 


 

     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:        Syufy Enterprises, L.P.
 
           150 Pelican Way
 
           San Rafael, California 94901
 
           Attention: General Counsel
 
       
 
  and a copy to:        DLA Piper
 
           203 North LaSalle
 
           Suite 1900
 
           Chicago, IL 60601
 
           Attention: David Sickle, Esq.

 


 

         
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     25.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     26.  Prior Amendments. All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Second Amendment and Third Amendment in their entirety.
     27.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond W. Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           

 

 

EXHIBIT 10.21(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions Proration of Taxes
    6  
5.03 Omitted
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terras of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Defeult
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 BindingEffect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No HoldingOver
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Exhibit A Description of Premises
    A-1  
Exhibit B Site Plan of Premises
    B-1  
Exhibit C Form of Memorandum
    C-1  
Exhibit D Guaranty of Lease
    D-1  

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Entire Premises.
               EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
      1.02. Definitions .
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1,1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

1


 

               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean ***      successive separate periods of *** each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the Leased Premises.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises .
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease .
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term .
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to***      consecutive additional periods of***          ; each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***           of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duty exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                         (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                         (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title .
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted a non-exclusive easement for parking and ingress and egress on and over the Entire Premises. Tenant is responsible for all costs associated with the Entire Premises exclusive of Landlord’s Building. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use. Tenant shall be subject to Landlord’s License Agreement with Lester Industrial Park and be responsible for all costs related thereto.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***         The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***       after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***        Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Las Vegas, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***                greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***        of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit
     4.03 Rent Payments . Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent . The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which are assessed on any Buildings exclusive of the Entire Premises, Tenant shall pay all such impositions. With respect to Impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election, Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be. In the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Leased Premises located on the Entire Premises.
     5.04 C ontest of Taxes . Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’s buildings.
     5.06 Personal Property Taxes . During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, If Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

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ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies . Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance . Tenant shall procure and maintain the following:
                    A) Commercial General Liability Insurance . Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of Landlord’s Buildings), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
                    B) Physical Property Damage Insurance . During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (Landlord’s Buildings excluded), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood, but including Builders Risk, to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance . The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
                    A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
                    B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord.
                    C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
                    D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.

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     6.04 Landlord’s Acquisition of Insurance . If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance . In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds . At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord..
     6.07 Cooperation for Insurance Proceeds . Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery . Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes .
                    A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
                    B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
                    (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition . For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity .
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work . In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible parry, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises .
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity .
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection . Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination .
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs .
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless . Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits: Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership .
               A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
               B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control . Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification . Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting .
                    A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
                    B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
                    C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages .
                    A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
                    B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages . If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
13.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions . The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
                    A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
                    B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
                    C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
                    D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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                    E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party . The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
                    A) Notice of Intended Taking;
                    B) Service of any legal process relating to condemnation of the Premises or improvements;
                    C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
                    D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term . On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking . On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
                    A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
                    B) To Landlord, the amount awarded, if any, for severance damages
                    C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
                    D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
                    E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
                    F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments . On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate . Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default . The occurrence of any of the following shall constitute a default or event of default by Tenant:
               A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
               B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
               C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative . Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
               A) Bring Suit for Performance . Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
               B) Re-Entry Without Termination . Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term, Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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               C) Termination of Lease and Lessee’s Right to Possession . No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in feet terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
                    (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
                    (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
                    (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
                    (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
                    (5) For any other sums due.
               D) Definitions . As used herein, the following phrases shall be interpreted as follows:
                    (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
                    (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
               E) Surrender . Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
               F) Appointment of Receiver . If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
               G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default .
               A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
               B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption . Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
               A) Description of Dispute . The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within tea (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
               B) Mediation . A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
               C) Arbitration . With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to § 1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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                             (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
                             (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
                             (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing, Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties . Landlord represents and warrants:
                    A) Landlord is the fee owner of the Premises.
                    B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
                    C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
                    D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
                    E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
                    F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
                    G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties . Tenant represents and warrants:
                    A) Tenant is a California corporation in good standing.
                    B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a parry.
                    C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements .
                    A) Tenant’s Obligation to Repair . If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage.
                    (B)  Damage in Excess of Fifty Percent (50%) . If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair . If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability . The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability . In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law . This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology . All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions . Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant .
                    A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
                    B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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               C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn: Real Estate Department
 
   
To Tenant:
  Century Theatres of California, Inc.
 
  150 Golden Gate Avenue
 
  San Francisco, CA 94102
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises . Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure . In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate . Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender . Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens . Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties . Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence . Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies . Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger . The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
             
TENANT :
           
 
           
    CENTURY THEATRES OF CALIFORNIA, INC., a California Corporation    
 
           
 
  By:   /s/ Joseph Syufy    
 
           
 
  Print Name:   Joseph Syufy
 
   
 
  Title:   V.P.    
 
           
 
           
LANDLORD :
           
 
           
    SYUFY ENTERPRISES
a California Limited Partnership
   
 
           
 
  By:   /s/ Raymond W. Syufy    
 
           
 
  Print Name:   Raymond W. Syufy    
 
           
 
  Title:   G.P    
 
           

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EXHIBIT 10.21(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Mountain View, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and c1arify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***       of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
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imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of“A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.
“Landlord”
  “Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
 
   
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
(STAMP)
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EXHIBIT 10.21(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment” ) dated April 15, 2005 is executed by and between Syufy Enterprises, L,P., a California limited partnership ( “Landlord” ) and Century Theatres , Inc., a California corporation ( “Tenant” ).
WITNESSETH:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Century 16, 1500 N. Shoreline Blvd., Mountain View, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Renewal Option
     Section 2.03 of the Lease is hereby deleted in its entirety and shall be replaced by the following:
2.03 Option to Extend Lease Term .
  A)   Tenant may, at Tenant’s option, extend the Term of this Lease for ***                 additional period of ***                 (the “ Renewal Term ”), subject to all the provisions of this Lease. The Renewal Term shall commence at the expiration of the current Term, and shall terminate on the***                 of the date of commencement of the Renewal Term, unless sooner terminated as provided herein.
Century 16 - Mountain View, California

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  B)   Failure to duly exercise the option for the Renewal Term shall nullify the option.
 
  C)   Tenant’s right to the option to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
  (1)   This Lease being in full force and effect on the last day of the current Term.
 
  (2)   Compliance with the following procedure for exercising the option:
  (a)   At least nine (9) months before the last day of the current Term, Tenant shall give Landlord written notice exercising the option.
 
  (b)   Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option has been exercised.
  (3)   Tenant is not in default at the time of the exercise of the renewal option and at the commencement of the Renewal Term.
B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in
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connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises , L.P.,
  Century Theatres , Inc.,
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
Century 16 - Mountain View, California

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EXHIBIT 10.21(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment” ) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and Century Theatres , Inc., a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Century 16, 1500 N. Shoreline Blvd., Mountain View, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
Century 16 - Mountain View, California

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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
Century 16 - Mountain View, California

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EXHIBIT 10.21(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Mountain View)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS:
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres of California, Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Mountain View, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.   Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.   Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.   Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an

 


 

validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***                 and rather than *** Renewal Terms of ***                 each (as provided in the Lease), Tenant shall have the option to extend the Initial Term, for ***                 Renewal Term of ***
     4.  Rent Reduction . From the Effective Date through and including ***, Tenant shall be entitled to a credit against the Base Rent otherwise due under the Lease, in an amount equal to $                 per annum (i.e., a credit of $                 per month against Minimum Monthly Rent).
     5.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Santa Clara typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty); provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     6.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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     7.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in subsection (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     8.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 6 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     9.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     10.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     11. Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:

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     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     12.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;

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  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     13.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theatre complex. Tenant shall be required to complete all alterations, improvements and changes undertaken by Tenant. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 5 of this Amendment.
     14.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission

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devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     15.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar

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      concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     16.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     17.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     18.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     19.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:

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Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     20.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     21.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:

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     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:        Syufy Enterprises, L.P.
 
           150 Pelican Way
 
           San Rafael, California 94901
 
           Attention: President
 
       
 
  with a copy to:         Syufy Enterprises, L.P.
 
            150 Pelican Way
 
            San Rafael, California 94901
 
            Attention: General Counsel
 
       
 
  and a copy to:         DLA Piper
 
            203 North LaSalle
 
            Suite 1900
 
            Chicago, IL 60601
 
            Attention: David Sickle, Esq.

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  To Tenant:         Century Theatres, Inc.
 
            c/o Cinemark, Inc.
 
            3900 Dallas Parkway
 
            Suite 500
 
            Piano, TX 75093
 
            Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     22.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     23.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Second Amendment and Third Amendment in their entirety.
     24.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

-11-


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
           
 
  Name:        
 
  Title:  
 
   
 
           
Tenant:
CENTURY THEATRES, INC., a Californic corporation
             
 
  By:   /s/ Raymond W. Syufy    
 
           
 
  Name:        
 
  Title:  
 
   
 
           

 

 

EXHIBIT 10.22(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
 
Page No.  
 
       
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III:Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions Proration of Taxes
    6  
5.03 Omitted
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
 
Page No.  
 
       
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
 
       
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

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LEASE
CENTURY THEATRES
Table of Contents
         
        Page No.
 
       
Exhibit A
  Description of Premises   A-1
Exhibit B
  Site Plan of Premises   B-1
Exhibit C
  Form of Memorandum   C-1
Exhibit D
  Guaranty of Lease   D-1

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LEASE
          THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYCAL PROPERTIES, INC., a California Corporation with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
          Landlord owns the fee interest in Land, Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
          Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Entire Premises.
               EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking, driveways and such other improvements as may presently exist or be added.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

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               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean *** successive separate periods of *** each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the Leased Premises.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord shall retain the area presently operated as a cocktail lounge and said cocktail lounge shall not be a part of this lease.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate *** thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of*** each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the *** of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Landlord is granted an easement for parking and ingress and egress on and over the Entire Premises for patrons of the Cocktail Lounge.
          D) As part of this Lease, Tenant is granted all rights under the CC&R’s created by the owners of the Contra Costa Shopping Center. Tenant shall be responsible for all costs related to said CC&R’s.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of *** . The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every *** after the Initial Rent Due Date as set forth in Section 4.01B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the *** Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the *** Lease Year and on the first day of each *** Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco- Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than *** greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which are assessed on any Buildings exclusive of the Entire Premises, Tenant shall pay all such impositions. With respect to Impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election, Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be. In the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Leased Premises located on the Entire Premises.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’s buildings.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

6


 

ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of the Cocktail Lounge), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (the cocktail lounge included), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “ A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.

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     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article XTV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord..
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such parry may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said parry shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of interior of Cocktail Lounge) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however. Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation
     14.3 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.4 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.5 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.6 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.4 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.5 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises or the improvements to the Comman Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises or the Common Area improvements to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area Improvements were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.2 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.3 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.1 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.2 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.3 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.4 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.5 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.6 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.7 Binding Effect Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.8 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
18.9 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Sycal Properties, Inc.
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
 
       
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
     
TENANT:
   
 
   
 
  CENTURY THEATRES OF CALIFORNIA, INC.,
 
  a California Corporation
 
   
 
  By: /s/Joseph Syufy
 
  Print Name: Joseph Syufy
 
  Title: V.P.
 
   
LANDLORD:
   
 
   
 
  SYCAL PROPERTIES, INC.
 
  a California Corporation
 
   
 
  By: /s/Alam Steuer
 
  Print Name: Alam Steuer
 
  Title: CFO

26

 

EXHIBIT 10.22(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Sycal Properties, Inc. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Pleasant Hill, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***    of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Pleasant Hill

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
Pleasant Hill

 


 

     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYCAL PROPERTIES, INC.
  CENTURY THEATRES, INC.
“Landlord”
  “Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
[STAMP]
Pleasant Hill

 

 

EXHIBIT 10.22(c)
Second Amendment To Lease
      this second amendment to lease (this “Amendment”) dated April 15, 2005 is executed by and between Sycal Properties, INC., a California corporation (“Landlord”) and Century Theatres, Inc., a California corporation (“Tenant”) .
Witnesseth :
      Whereas, Landlord and Century Theatres of California, Inc, a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Century Pleasant Hill, 2341 Monument Boulevard, Pleasant Hill, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, together, Syufy Enterprises, L.P., Syufy Properties, Inc., Syaz Properties, Inc. and Syut Properties, Inc., each an affiliate of Landlord (collectively, the “Shareholders” ), own all of the outstanding shares of capital stock of Tenant (the “Shares” ); and
      Whereas, the Shareholders desire to sell the Shares pursuant to a stock purchase agreement; and
      Whereas, the parties wish to terminate this Lease as of one (1) day prior to the effective date of the sale by the Shareholders of the Shares (the “Closing” ); and
      Whereas, the parties desire now to amend the Lease as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Termination of Lease; Surrender
     The parties hereby agree that the Lease shall terminate and be of no further force or effect (except as set forth herein) as of one (1) day prior to the Closing (the “Termination Date” ). Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination
Century Pleasant Hill 5 — Pleasant Hill, California

1


 

of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century Pleasant Hill 5 — Pleasant Hill, California

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Sycal Properties, Inc.,
      Century Theatres, Inc.,    
a California corporation
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century Pleasant Hill 5 — Pleasant, California

3

 

EXHIBIT 10.22(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Properties, Inc., a California corporation ( “Landlord” ) and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth :
      Whereas, Sycal Properties, Inc. and Century Theatres of California, Inc, a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Sycal Properties, Inc. and Century Theatres, Inc., a Delaware corporation and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Sycal Properties, Inc. and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises”) located at Century Pleasant Hill, 2341 Monument Boulevard, Pleasant Hill, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, Syufy Properties, Inc. has succeeded Sycal Properties, Inc. as Landlord and has assumed all of its obligations as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Term and Termination
     The termination provision, as set forth in that certain Second Amendment to Lease, dated April 15, 2005 is hereby deleted and the Initial Term, as set forth in the lease dated September 30, 1995 shall remain unchanged.
Century Pleasant Hill 5 — Pleasant Hill, California

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B. Annual Rent
     Annual Base Rent for the remainder of the Initial Term of the Lease shall be fixed at *** ***   per year, payable monthly as set forth in the Lease.
C. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
D. Miscellaneous
          This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
          This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
          This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
          Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
          The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
          This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century Pleasant Hill 5 — Pleasant Hill, California

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Properties, Inc.,
      Century Theatres, Inc.,    
a California corporation
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century Pleasant Hill 5 — Pleasant Hill, California

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EXHIBIT 10.22(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Pleasant Hill)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY PROPERTIES, INC., a California corporation (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Sycal Properties, Inc. (“Original Landlord”) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”) for certain premises located in Pleasant Hill, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Amended Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Amended Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Amended Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”), In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease, the current Term of the Lease shall expire on the date that is *** after the Effective Date hereof. Thereafter, the Term of this Lease shall automatically renew on *** unless Tenant delivers written notice to Landlord at least sixty (60) days prior to the then-current expiration date of the Term that Tenant elects not to extend the Term of the Lease.
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Contra Costa typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
     6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:

 


 

          (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
          (B) If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the uninsured cost to repair such damage or to restore the Leased Premises (including deductibles) exceeds $50,000, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises (provided, however, that Landlord may nullify Tenant’s election not to undertake the repairs and restoration, within thirty (30) days after receiving Tenant’s notice by confirming either (x) that Landlord shall reimburse Tenant for such excess costs within 30 days after the completion of the repairs and restoration and Landlord’s receipt of reasonable supporting documentation of such costs or (y) that Landlord waives its right to terminate this Lease pursuant to Section 18 prior to the date which is 12 months after the repairs and restoration are completed), and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.

 


 

No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l”.
     9.  [Intentionally Omitted].
     10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and

 


 

other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
          Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant

 


 

shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements entered into after the Effective Date by Landlord and a licensee or lessee regarding Rooftop Equipment provided that such Rooftop Equipment does not interfere with Tenant’s Rooftop Equipment installed pursuant to this Section.
     14.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any

 


 

demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     15.  Alternate Rent. As of the Effective Date and if and for so long as Tenant continues to satisfy the Operating Condition (defined in Section 4 above), then in lieu of Base Rent and Percentage Rent otherwise due under the Lease (but not in lieu of Tenant’s share of real estate taxes or any other amounts payable by Tenant under the Lease, which will continue to be due and payable by Tenant as provided in the Lease), Tenant shall pay to Landlord on a monthly basis an amount equal to *** of Tenant’s Gross Sales, as defined in Section 10 above. Such amount shall be paid by Tenant monthly in arrears on or before the thirtieth (30 th ) day after the end of each calendar month. Within sixty (60) days after the end of each fiscal year, Tenant shall provide a written certification of Tenant’s Gross Sales for the prior year, executed by the chief financial officer or controller of Tenant, which shall be subject to the same year-end reporting and reconciliation procedures and the verification and audit rights of Landlord that apply to Percentage Rent under this Lease.
     16.  Early Termination — Tenant. (i) If, during any consecutive twelve (12) calendar month period after the Effective Date (the “Test Period”), the TLCF (defined on Exhibit “A-2” hereto) for the Leased Premises is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the TLCF over the most current trailing twelve (12) month period was *** or within forty-five (45) days after such Test Period, to terminate the Lease as provided below in this Section; provided, however, that such notice and Tenant’s right to terminate the Lease as provided in this Section shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined in Section 4 above) continuously throughout the Test Period. In order to be effective, Tenant’s notice to Landlord under this Section shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice.
          (ii) If, at anytime during which Tenant is paying Alternate Rent, Tenant reasonably determines that it is necessary or appropriate to undertake in any prospective 12-month period (the “Cap Ex Test Period”), aggregate capital expenditures (i.e., expenditures required to be capitalized rather than expensed under Tenant’s normal income tax accounting procedures) for any repairs and maintenance to the Leased Premises in excess of *** which Tenant is otherwise unwilling to make, then, Tenant shall have the right and option to terminate the Lease upon thirty (30) days prior written notice to Landlord, subject to the following terms and conditions: (A) Tenant’s notice of termination shall specify in reasonable detail the applicable capital expenditures (the “Cap Ex Projects”), the projected commencement date of each Cap Ex Project and the estimated costs thereof (the “Projected Cap Ex Costs”), prior to incurring same and prior to the commencement of the Cap Ex Test Period; (B) Landlord shall have the ability (but not the obligation) to nullify Tenant’s exercise of the termination option set forth in this subclause (ii) by delivering written notice to Tenant within ten (10) business days after the date of its receipt of Tenant’s termination notice stating either that (1) Landlord shall reimburse Tenant for the amount by which the actual cost incurred by Tenant (within 30 days of receipt of reasonable documentation of such expense) during the Cap Ex Test

 


 

Period for the identified Cap Exp Projects (but not more than the Projected Cap Ex Costs) exceed ***, or (2) Landlord waives its right to terminate this Lease pursuant to Section 17 below during the applicable Cap Ex Test Period; (C) if Landlord so nullifies Tenant’s purported termination, then Tenant shall be required to undertake the Cap Ex Projects not later than thirty (30) days after the applicable dates specified in Tenant’s notice of termination and thereafter to diligently prosecute the Cap Ex Projects to completion, at Tenant’s sole cost and expense (subject to reimbursement from Landlord as provided above, if applicable); and (D) if Tenant fails to undertake and complete the identified Cap Ex Projects as aforesaid, then (x) such failure shall constitute a default by Tenant under the Lease, and (y) Landlord’s termination rights under Section 17 below will be immediately reinstated (notwithstanding the waiver pursuant to clause (2) above, if applicable).
     17.  Early Termination — Landlord. Landlord shall have the right, at anytime after the Effective Date of this Amendment, to terminate this Lease upon not less than thirty (30) days’ prior written notice to Tenant.
     18.  Restrictive Covenant. Landlord covenants and agrees that upon the termination of the Lease for any reason other than the default of the Tenant, no portion of the Entire Premises including the Leased Premises shall be used as a motion picture theater complex for a period of 10 years. The terms and provisions of this Section shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after the request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the cost of all such recording fees.
     19.  California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     20.  Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and

 


 

remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     21.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.

 


 

     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Properties, Inc.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President
 
   
with a copy to:
       Syufy Enterprises, L.P.
 
       150 Pelican Way
 
       San Rafael, California 94901
 
       Attention: General Counsel
 
   
and a copy to:
        DLA Piper
 
       203 North LaSalle
 
       Suite 1900
 
       Chicago, IL 60601 94901
 
       Attention: David Sickle, Esq.
 
   
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Plano, TX 75093
 
  Attention: Legal Department
     22. Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.

 


 

     23.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     24.  Prior Amendments. All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     25.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
                 
    By:   /s/ Joseph Syufy    
             
    Name:        
 
               
    Title:        
 
         
 
   
Tenant:
CENTURY THEATRES, INC., a California corporation
                 
    By:   /s/ Raymond W. Syufy    
             
    Name:        
 
               
    Title:        
 
         
 
   

 


 

EXHIBIT “A-2”


 

Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
  

 

EXHIBIT 10.23(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
                 
            Page No.  
Recitals     1  
       
 
       
ARTICLE I: Definitions — Exhibits        
  1.01    
Attachments to Lease and Exhibits
    1  
  1.02    
Definitions
    1  
       
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title        
  2.01    
Lease of Premises
    2  
  2.02    
Term of Lease
    2  
  2.03    
Option to Extend Lease Term
    3  
  2.04    
Covenant of Title
    3  
       
 
       
ARTICLE III: Use of Premises        
  3.01    
Use
    4  
       
 
       
ARTICLE IV: Rent        
  4.01    
Base Rent / Minimum Monthly Rent
    4  
  4.02    
Percentage Rent
    4  
  4.03    
Rent Payments
    5  
  4.04    
Place for Payment of Rent
    5  
  4.05    
Late Payment of Rent
    5  
       
 
       
ARTICLE V: Taxes, Assessments and Utilities        
  5.01    
Impositions
    5  
  5.02    
Proration of Taxes
    6  
  5.03    
Exceptions from Impositions; Charges in Lieu of Impositions
    6  
  5.04    
Contest of Taxes
    6  
  5.05    
Utilities
    7  
  5.06    
Personal Property Taxes
    7  
       
 
       
ARTICLE VI: Insurance        
  6.01    
Acquisition of Insurance Policies
    7  
  6.02    
Types of Required Insurance
    7  
  6.03    
Terms of Insurance
    8  
  6.04    
Landlord’s Acquisition of Insurance
    8  
  6.05    
Insurance Money and Other Funds Held In Trust
    8  
  6.06    
Application or Proceeds of Physical Damage Insurance
    8  
  6.07    
Cooperation for Insurance Proceeds
    9  
  6.08    
Waiver of Right of Recovery
    9  
       
 
       
ARTICLE VII: Maintenance, Repairs And Alterations        
  7.01    
Alterations — Changes
    9  
 i

 


 

LEASE
CENTURY THEATRES
Table of Contents
                 
            Page No.  
  7.02    
Repairs — Maintenance
    10  
       
 
       
ARTICLE VIII: Environmental Matters        
  8.01    
Definition
    10  
  8.02    
Tenant’s Responsibilities and Landlord Indemnity
    10  
  8.03    
Remedial Work
    11  
  8.04    
Maintenance of Premises
    12  
  8.05    
Landlord’s Responsibilities and Tenant’s Indemnity
    12  
  8.06    
Landlord Inspection
    13  
  8.07    
Effect of Termination
    13  
       
 
       
ARTICLE IX: Improvements        
  9.01    
Tenant’s Signs
    14  
  9.02    
Hold Harmless
    14  
  9.03    
Permits; Compliance With Codes
    14  
  9.04    
Ownership
    14  
  9.05    
Control
    15  
       
 
       
ARTICLE X: Indemnity        
10.01  
Indemnification
    15  
       
 
       
ARTICLE XI: Assignment and Subletting        
  11.01    
Assignment and Subletting
    15  
  11.02    
Notice to Landlord
    16  
       
 
       
ARTICLE XII Encumbrance of Leasehold Estate        
  12.01    
Leasehold Mortgages
    16  
       
 
       
ARTICLE XIII: Mortgage Subordination        
  13.01    
Existing Mortgages
    16  
  13.02    
Future Mortgages
    16  
       
 
       
ARTICLE XIV: Condemnation — Eminent Domain        
  14.01    
Definitions
    16  
  14.02    
Notice to Other Party
    17  
  14.03    
Total Taking — Effect on Rent and Term
    17  
  14.04    
Distribution of Award for Taking
    17  
  14.05    
Partial Taking — Rent Adjustments
    18  
  14.06    
Partial Taking — Option to Terminate
    18  
  14.07    
Separate Tenant’s Award
    18  
       
 
       
ARTICLE XV: Default        
 ii

 


 

LEASE
CENTURY THEATRES

Table of Contents
                 
            Page No.  
  15.01    
Tenant’s Default
    18  
  15.02    
Landlord’s Remedies Cumulative
    18  
  15.03    
Landlord’s Default
    20  
  15.04    
Waiver of Redemption
    20  
  15.05    
Dispute Resolution
    20  
  15.06    
Attorney Fees
    21  
       
 
       
ARTICLE XVI: Representations and Warranties        
  16.01    
Landlord’s Representations and Warranties
    21  
  16.02    
Tenant’s Representations and Warranties
    22  
       
 
       
ARTICLE XVII: Damage or Destruction        
  17.01    
Repairs, Alterations and Further Improvements
    22  
  17.02    
Prompt Repair
    22  
  17.03    
Rent Adjustment
    23  
       
 
       
ARTICLE XVIII: Miscellaneous        
  18.01    
Limitation on Liability
    23  
  18.02    
Modification
    23  
  18.03    
Severability
    23  
  18.04    
Governing Law
    23  
  18.05    
Terminology
    23  
  18.06    
Counterparts
    23  
  18.07    
Binding Effect
    23  
  18.08    
Captions
    23  
  18.09    
Notice to Landlord and Tenant
    23  
  18.10    
Addresses for Notices to Landlord and Tenant
    24  
  18.11    
Entire Agreement
    24  
  18.12    
Sale or Transfer of Premises
    24  
  18.13    
Force Majeure
    25  
  18.14    
Waiver
    25  
  18.15    
Estoppel Certificate
    25  
  18.16    
Number and Gender
    25  
  18.17    
No Holding Over
    25  
  18.18    
Mechanics Liens
    25  
  18.19    
Relationship of Parties
    25  
  18.20    
Time of the Essence
    26  
  18.21    
Facsimile Copies
    26  
  18.22    
Anti-Merger
    26  
       
 
       
Signature Page     26  
 iii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Exhibit A Description of Premises
    A-l  
Exhibit B Site Plan of Premises
    B-l  
Exhibit C Form of Memorandum
    C-l  
Exhibit D Guaranty of Lease
    D-l  

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
          Attached to this Lease and hereby made a part hereof are the following:
          EXHIBIT A — a description of the Premises.
          EXHIBIT B — a site plan of the Premises.
          EXHIBIT C — Form of Memorandum of Lease
          EXHIBIT D — Guaranty of Lease
      1.02. Definitions.
          The following terms for purposes of this Lease shall have the meanings hereinafter specified:
          The term “Commencement Date” shall mean October 1, 1995.
          The term “Effective Date” shall mean October 1, 1995.
          The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
          The Term “Initial Rent Due Date” shall mean October 1, 1995.
          The term “Initial Term” is defined in Section 2.02 herein.

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          The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
          The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
          The term “Number of Term Years” shall mean ***
          The term “Option Periods” shall mean *** successive separate periods of *** each.
          The term “Percentage Rate” shall mean ***
          The term “Premises” shall mean the real property set forth in Exhibit A.
          The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
          The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
          The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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     The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate *** thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of *** each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the *** of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall’ at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
          (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of *** The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every *** after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the *** Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the *** Lease Year and on the first day of each *** Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco- Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than *** greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent . In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent’ then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent’ Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.3 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America All payments shall be made by Tenant to Landlord without notice or demand.
     4.4 Place for Payment of Rent . The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.5 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions .
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

6


 

contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant foils to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

7


 

proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto, If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless . Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however . Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership .
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification . Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award, which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default . The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession . No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default .
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation . A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant .
          A) Except as otherwise in this Lease provided, a bill, demand statement, consent notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn: Real Estate Department
 
   
To Tenant:
  Century Theatres of California, Inc.
 
  150 Golden Gate Avenue
 
  San Francisco, CA 94102
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver. No term, covenant or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT :
         
  CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
 
 
  By:   /s/ Joseph Syufy   
  Print Name:   Joseph Syufy   
  Title:    V.P.   
 
LANDLORD :
         
  SYUFY ENTERPRISES
a California Limited Partnership
 
 
  By:   /s/ Raymond W. Syufy    
  Print Name:   Raymond W. Syufy   
  Title:    G.P.   
 

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EXHIBIT 10.23(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located on Winchester Boulevard in San Jose, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than *** of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city

C-24  San Jose


 

admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:

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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P. “Landlord”
  CENTURY THEATRES, INC. “Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
 
   
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
[STAMP]
C-24  San Jose
 

EXHIBIT 10.23(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”) and Century THEATRES, INC., a California corporation (“Tenant”) .
WITNESSETH :
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at 741 Winchester Blvd., San Jose, California and known as Century 24 San Jose; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Right to Terminate
     At any time after the earlier to occur of (1) March 15, 2008 and (2) the date a new 20-screen theatre to be developed by Tenant in place of the theaters currently known as the Century 21, 22, and 23 and located at Winchester Boulevard and Olsen Drive, San Jose, California opens for business, either Landlord or Tenant may terminate the Lease by delivering written notice (the “Termination Notice” ) to the other party thirty (30) days prior to the desired termination date (the “Termination Date” ). If either party delivers a Termination Notice to the other party as set forth above, then, as of the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, with the exception of any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
 
1 Century 24 - San Jose, California

 


 

B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
 
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D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
 
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P .,
  Century Theatres, Inc.,
a California limited partnership
“Landlord”
  a California corporation
“Tenant”
 
   
/s/Raymond Syufy
  /s/Joseph Syufy
 
   
Raymond Syufy
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
 
4 Century 24 - San Jose, California

 

 

EXHIBIT 10.23(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment” ) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and CENTURY THEATRES, INC., a California corporation ( “Tenant” ).
WITNESSETH:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at 741 Winchester Blvd., San Jose, California and known as Century 24 San Jose; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
 
1 Century 24 - San Jose, California

 


 

      2.  This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
      5.  The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership
“Landlord”
  a California corporation
“Tenants”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
 
2 Century 24 - San Jose, California

 

 

EXHIBIT 10.23(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Century 24)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS :
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in San Jose, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on *** and rather than *** Renewal Terms of *** each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for *** consecutive Renewal Terms of *** each, followed by *** additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Santa Clara typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closures; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A)  Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) below. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) If the Leased Premises are damaged or destroyed by fire or other casualty which occurs after the Effective Date hereof, and if the cost to repair such damage or to restore the Leased Premises exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, and (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.

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No assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l”.
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross

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Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
          (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
          (ii) Attributable to the annual inflationary increases in real estate taxes; or
          (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for [real estate taxes] under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.

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     12.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make nonstructural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to

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      the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within the common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages within the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.

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     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     16.  Early Termination — Opening of Nearby Theatre . As used herein, the term “Nearby Theatre” shall mean any motion picture theatre complex that is initially developed and commences operation after the Effective Date hereof and is located at, or within a *** radius of, the location of the currently-existing “Century 21”, “Century 22” and “Century 23” theatres in San Jose, California. If Tenant operates any Nearby Theatre as a motion picture complex any time after the Effective Date, then Landlord and Tenant shall each have the right and option to terminate this Lease, upon not less than thirty (30) days’ prior written notice to the other party.
     17.  Restrictive Covenant . Landlord covenants and agrees that if, upon the termination of the Lease for any reason, other than the default of Tenant, Tenant or an affiliate of Tenant is leasing and operating a Nearby Theater as a motion picture theatre complex, then no portion of the Entire Premises including the Leased Premises shall be used or operated as a motion picture theater complex prior to the date which is the first to occur of (i) twenty (20) years from the date the Nearby Theatre opens or (ii) the termination or expiration of the Nearby Theater lease or (iii) the Nearby Theater ceasing to be open to the public and operating as a first-run motion picture theater complex, for reasons other than Excused Closures for a continuous period of eighteen (18) months or more. The terms and provisions of this Section shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequence of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the costs of all such recording fees.
     18.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     19.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:

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     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
               (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
               (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
               (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
               (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
               (5) for any other sums due.”
     20.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any

9


 

notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President
     
with a copy to:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: General Counsel
 
   
and a copy to:
  DLA Piper
 
  203 North LaSalle
 
  Suite 1900
 
  Chicago, IL 60601 94901
 
  Attention: David Sickle, Esq.
     
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Plano, TX 75093
 
  Attention: Legal Department
     Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     21.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises

10


 

leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     22.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio - it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     23.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
         
  SYUFY ENTERPRISES, L.P., a California limited partnership
 
 
  By: /s/ Joseph Syufy   
  Name:      
  Title:      
 
Tenant:
         
  CENTURY THEATRES, INC., a California corporation
 
 
  By: /s/ Raymond W. Syufy   
  Name:      
  Title:      
 

 

EXHIBIT 10.24(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
Recitals
        1  
 
           
ARTICLE I: Definitions — Exhibits        
1.01
  Attachments to Lease and Exhibits     1  
1.02
  Definitions     1  
 
           
ARTICLE II: Premises — Term — Options — Covenant of Title        
2.01
  Lease of Premises     2  
2.02
  Term of Lease     2  
2.03
  Option to Extend Lease Term     3  
2.04
  Covenant of Title     3  
 
           
ARTICLE III: Use of Premises        
3.01
  Use     4  
 
           
ARTICLE IV: Rent        
4.01
  Base Rent / Minimum Monthly Rent     4  
4.02
  Percentage Rent     4  
4.03
  Rent Payments     5  
4.04
  Place for Payment of Rent     5  
4.05
  Late Payment of Rent     5  
 
           
ARTICLE V: Taxes, Assessments and Utilities        
5.01
  Impositions     5  
5.02
  Proration of Taxes     6  
5.03
  Exceptions from Impositions; Charges in Lieu of lmpositions     6  
5.04
  Contest of Taxes     6  
5.05
  Utilities     7  
5.06
  Personal Property Taxes     7  
 
           
ARTICLE VI: Insurance        
6.01
  Acquisition of Insurance Policies     7  
6.02
  Types of Required Insurance     7  
6.03
  Terms of Insurance     8  
6.04
  Landlord’s Acquisition of Insurance     8  
6.05
  Insurance Money and Other Funds Held In Trust     8  
6.06
  Application or Proceeds of Physical Damage Insurance     8  
6.07
  Cooperation for Insurance Proceeds     9  
6.08
  Waiver of Right of Recovery     9  
 
           
ARTICLE VII: Maintenance, Repairs And Alterations        
7.01
  Alterations — Changes     9  

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
7.02
  Repairs — Maintenance     10  
 
           
ARTICLE VIII: Environmental Matters        
8.01
  Definition     10  
8.02
  Tenant’s Responsibilities and Landlord Indemnity     10  
8.03
  Remedial Work     11  
8.04
  Maintenance of Premises     12  
8.05
  Landlord’s Responsibilities and Tenan’s Indemnity     12  
8.06
  Landlord Inspection     13  
8.07
  Effect of Termination     13  
 
           
ARTICLE IX: Improvements        
9.01
  Tenant’s Signs     14  
9.02
  Hold Harmless     14  
9.03
  Permits; Compliance With Codes     14  
9.04
  Ownership     14  
9.05
  Control     15  
 
           
ARTICLE X: Indemnity        
10.01
  Indemnification     15  
 
           
ARTICLE XI: Assignment and Subletting        
11.01
  Assignment and Subletting     15  
11.02
  Notice to Landlord     16  
 
           
ARTICLE XII Encumbrance of Leasehold Estate        
12.01
  Leasehold Mortgages     16  
 
           
ARTICLE XIII: Mortgage Subordination        
13.01
  Existing Mortgages     16  
13.02
  Future Mortgages     16  
 
           
ARTICLE XIV: Condemnation — Eminent Domain        
14.01
  Definitions     16  
14.02
  Notice to Other Party     17  
14.03
  Total Taking — Effect on Rent and Term     17  
14.04
  Distribution of Award for Taking     17  
14.05
  Partial Taking — Rent Adjustments     18  
I4.06
  Partial Taking — Option to Terminate     18  
14.07
  Separate Tenant’s Award     18  
 
           
ARTICLE XV: Default        

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
15.01
  Tenant’s Default     18  
15.02
  Landlord’s Remedies Cumulative     18  
15.03
  Landlord’s Default     20  
15.04
  Waiver of Redemption     20  
15.05
  Dispute Resolution     20  
15.06
  Attorney Fees     21  
 
           
ARTICLE XVI: Representations and Warranties        
16.01
  Landlord’s Representations and Warranties     21  
16.02
  Tenant’s Representations and Warranties     22  
 
           
ARTICLE XVII: Damage or Destruction        
17.01
  Repairs, Alterations and Further Improvements     22  
17.02
  Prompt Repair     22  
17.03
  Rent Adjustment     23  
 
           
ARTICLE XVIII: Miscellaneous        
18.01
  Limitation on Liability     23  
18.02
  Modification     23  
18.03
  Severability     23  
18.04
  Governing Law     23  
18.05
  Terminology     23  
18.06
  Counterparts     23  
18.07
  Binding Effect     23  
18.08
  Captions     23  
18.09
  Notice to Landlord and Tenant     23  
18.10
  Addresses for Notices to Landlord and Tenant     24  
18.11
  Entire Agreement     24  
18.12
  Sale or Transfer of Premises     24  
18.13
  Force Majeure     25  
18.14
  Waiver     25  
18.15
  Estoppel Certificate     25  
18.16
  Number and Gender     25  
18.17
  No Holding Over     25  
18.18
  Mechanics Liens     25  
18.19
  Relationship of Parties     25  
18.20
  Time of the Essence     26  
18.21
  Facsimile Copies     26  
18.22
  Anti-Merger     26  
 
           
Signature Page     26  

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LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
Exhibit A
  Description of Premises     A-1  
Exhibit B
  Site Plan of Premises     B-1  
Exhibit C
  Form of Memorandum     C-1  
Exhibit D
  Guaranty of Lease     D-1  

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
                    Attached to this Lease and hereby made a part hereof are the following:
                    EXHIBIT A — a description of the Premises.
                    EXHIBIT B — a site plan of the Premises.
                    EXHIBIT C — Form of Memorandum of Lease
                    EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.

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               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean ***             successive separate periods of ***                each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord

2


 

     The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***       thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***       consecutive additional periods of ***        each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***        of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                      (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                      (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***             The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every *** after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***      Lease Year and on the first day of each ***       Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco-Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***       greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which *** of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.

Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “ A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
                    (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
                    (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of tirne the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Secton. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any tirne and from tirne to tirne during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportarion of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits: Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE III
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          Ç) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenants obligation to pay Rent shall terrninate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages.
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord, and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively, they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises by legal proceedings (or wthout legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.4 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.5 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other, causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no, way define, limit extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice’’) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, tide in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
         
    CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
 
       
 
  By:   /s/ Joseph Syufy
    Print Name: Joseph Syufy
 
  Title:   V.P.
LANDLORD:
         
    SYUFY ENTERPRISES
a California Limited Partnership
 
       
 
  By:   /s/ Raymond W. Syufy
    Print Name: Raymond W. Syufy
 
  Title:   G.P.

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EXHIBIT 10.24(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Napa, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than***                 of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Napa

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
         
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond W. Syufy
  /s/ Joseph Syufy    
Raymond W. Syufy
  Joseph Syufy    
Chief Executive Officer
  President    
[STAMP]
Napa

 

 

EXHIBIT 10.24(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment” ) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Cinedome Napa, 825 Pearl Street, Napa, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Right to Terminate
     At any time after the date the movie theatre to be operated by Tenant and to be located in Napa at or about ***           and ***           opens for business, either Landlord or Tenant may terminate the Lease by delivering written notice (the “Termination Notice” ) to the other party, indicating the date on which the Lease shall terminate (the “Termination Date”) . If either party delivers a Termination Notice to the other party as set forth above, then, as of the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, with the exception of any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
Cinedome Napa — Napa, California

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B. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
Cinedome Napa — Napa, California

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D. Deletion of Renewal Option
     The “Option to Extend Lease Term” set forth in Section 2.03 of the Lease is hereby deleted in its entirety, shall be deemed null and void, and shall be of no further force or effect. Notwithstanding anything to the contrary in the Lease, as of the date of this Amendment, Tenant shall have no further option to extend the term of the Lease.
E. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Cinedome Napa — Napa, California

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
Cinedome Napa — Napa, California

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EXHIBIT 10.24(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “ Amendment ”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership ( “Landlord” ) and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth :
     W hereas , Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000 between Landlord and Century Theatres, Inc., a Delaware corporation, and as further amended by that certain Second Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at Cinedome Napa, 825 Pearl Street, Napa, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
     W hereas , Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, T herefore , the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
Cinedome Napa — Napa, California

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     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Cinedome Napa - Napa, California

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      In Witness Whereof , Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
Cinedome Napa - Napa, California

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EXHIBIT 10.24(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Napa 8)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres of California, Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Napa, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

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     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***                and rather than ***                Renewal Terms of ***               each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***                consecutive Renewal Terms of ***                each, followed by ***                additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Napa typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i)

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any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.   Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l” .
     9.   Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.   Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the

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Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
     (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
     (ii) Attributable to the annual inflationary increases in real estate taxes; or

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     (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
     During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
     Commencing on the fifth (5th) anniversary of the Effective Date, and continuing until the tenth (10th) anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
     The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theater complex. Tenant shall be required to complete all alterations, improvements or changes that Tenant undertakes. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without

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limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
     (a) Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
     (b) Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
     (c) Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
     (d) Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any

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food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
     (e) Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as a first-class motion picture theatre complex (whether operated as a so-called “first-run” theater and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex or a so-called “second-run” theater complex.
     16.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  Early Termination — Opening of Nearby Theatre . As of the Effective Date hereof, Tenant is the lessee under a lease agreement (the “Nearby Theatre Lease”) for the motion picture theatre complex located or to be located at the proposed “***” in Napa, California (the “Nearby Theatre”). As of the date the Nearby Theater opens for business to the public, the Lease shall be terminated
     18.  Early Termination — Cancellation of Nearby Theatre Lease . In the event during any consecutive twelve (12) calendar month period from the Effective Date (the “Test Period”) the Nearby Theatre is not constructed and open for business to the general public, and if the Theatre Level Cash Flow (“TLCF”), as defined in Exhibit “A-3” hereto, for the Leased Premises over the Test Period is less than ***, then Tenant shall have the right, to be exercised by written notice to Landlord at any time when the most current trailing twelve (12) month period was *** or within forty-five days after such Test Period, to terminate the Lease as provided below in this Section 18; provided , however , that Tenant shall have concurrently or previously terminated the Nearby Theatre Lease; and provided further , that such notice and Tenant’s right to terminate the Lease for the applicable Test Period shall be void and ineffective unless Tenant shall have satisfied the Operating Condition (defined above) continuously

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throughout the applicable Test Period. Further, in order to be effective, Tenant’s notice to Landlord under this Section 18 shall include a written certification to Landlord from Tenant’s chief financial officer or controller confirming that the TLCF for the Test Period is less than ***. Provided Tenant has satisfied the aforesaid conditions, then this Lease shall be terminated effective as of the date which is thirty (30) days after the termination notice.
     19.  Restrictive Covenant . Landlord covenants and agrees that if, upon the termination of the Lease for any reason, other than the default of Tenant, Tenant or an affiliate of Tenant is leasing and operating a Nearby Theater pursuant to the Nearby Theater Lease, then no portion of the Entire Premises including the Leased Premises shall be used or operated as a motion picture theater complex prior to the date which is the first to occur of (i) ten (10) years from the date that the Nearby Theater is or was first open to the general public and operated as a motion picture theater complex or (ii) the termination or expiration of the Nearby Theater Lease or (iii) the Nearby Theater ceasing to be open to the public and operating as a first-run motion picture theater complex, for reasons other than Excused Closures for a continuous period of eighteen (18) months or more. The terms and provisions of this Section 19 shall survive the termination of the Lease except that the foregoing restrictive covenant shall not apply if the Lease is terminated as a consequent of a default by Tenant. Such restrictive covenant shall run with the land. Landlord agrees to execute within thirty (30) days after request by Tenant a restrictive covenant in form appropriate for recording containing the restrictions contained herein. Tenant shall be responsible for the costs of all such recording fees.
     20.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     21.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all

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the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     22.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease

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shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
     Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     23.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     24.  Prior Amendments . All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that

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this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     25.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufi    
 
           
 
  Name:   Joseph Syufi    
 
  Title:   President    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond W. Syufi    
 
           
 
  Name:   Raymond W. Syufi    
 
  Title:   Chief Executive Officer    


 

EXHIBIT “A-3”
Definition of Theatre Level Cash Flow
Theatre Level Cash Flow ” shall mean all revenues attributable to the Leased Premises over the applicable measurement period, less expenses clearly attributable to the Leased Premises over the same period as reflected on the applicable individual theatre level cash flow statement calculated by the company using consistent methods and policies as that utilized by the company in determining the theatre cash flow on substantially all of its other individual theatre properties.
Revenues shall include box office receipts (less applicable admission tax), concession receipts (less applicable sales tax), game revenues (less applicable sales tax), pay phone revenue, studio and other rental income, ATM revenue, revenue from tickets redeemed at the theatre from internet or other off-site ticketing (but not related fees charged for such service or revenue from unredeemed tickets), and any other revenues attributable to the operations of the theatre.
Expenses shall include all costs necessary to operate the theatre and theatre, including but not limited to film rental, snack bar cost of sales (net of all applicable rebates from vendors), payroll expenses attributable to employees working at the theatre, advertising costs, security expenses, janitorial expenses, maintenance (excluding capitalized expenses), repairs (excluding capitalized expenses), supplies, utilities, telephone expenses, freight, bank and credit card expense, business tax and licenses, cash shortages, base rent, percentage rent, common area maintenance, property taxes, and insurance.
Expenses specifically excluded include charges for off-site administration costs, income taxes, interest, and depreciation & amortization.
 A-3-1 

 

EXHIBIT 10.25(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
UNION LANDING ENTERTAINMENT CENTER LEASE
BY AND BETWEEN
DYER TRIANGLE LLC
CALIFORNIA LIMITED LIABILITY COMPANY
LANDLORD
AND
CENTURY THEATRES, INC.
DELAWARE CORPORATION
TENANT

 


 

UNION LANDING ENTERTAINMENT CENTER LEASE
     THIS LEASE AGREEMENT (referred to herein as the “Lease”) is made this 10 th day of April, 1998, by and between Dyer Triangle LLC, a California Limited Liability Company, (“Landlord”), and Century Theatres, Inc., a Delaware Corporation (“Tenant”).
ARTICLE I
EXHIBITS AND BASIC LEASE TERMS
      Section 1.01. Attachments to Lease and Exhibits:
           EXHIBIT A — Site Plan for “Entire Premises” commonly knows as the “Union Landing Entertainment Center” showing the location of the Tenant’s Building outlined in red.
      Section 1.02. Basic Lease Terms and Definitions.
          1.02.1. “ Entire Premises” shall mean “Union Landing Entertainment Center” located in the City of Union City, State of California.
          1.02.2. “Commencement date” shall mean the date which is the earlier of (i) nine months after Tenant has received a building permit for the construction of Tenant’s Building or (ii) the date on which Tenant opens for business in the Premises.
          1.02.3. “Term” shall mean Initial Term of ***      with ***      options and ***      option.
          1.02.4. Tenant’s Trade Name. Century Theatres.
          1.02.5. Floor Area. Approximately 96,000 square feet.
          1.02.6. Minimum Rent.
                         
Dollars/ Years   Dollars/Month   Dollars/sq. ft.   Years
***
    ***       ***       ***  
***
    ***       ***       ***  
***
    ***       ***       ***  
***
    ***       ***       ***  
***
    ***       ***       ***  
***
    ***       ***       ***  
***
    ***       ***       ***  
          1.02.7. Percentage Rent.***
          1.02.8. Premises. Theatre Parcel.
          1.02.9. Use of Premises. A Motion Picture Theatre Complex.
          1.02.10. Security Deposit. None.
ARTICLE II
LEASED PREMISES
      Section 2.01. Leased Premises.
     Landlord hereby leases to Tenant, and Tenant hereby rents from Landlord, those certain premises and improvements located in the Entire Premises, consisting of approximately 96,000 square feet of gross leasable area, (the “Premises” or “Leased Premises”). “Area” means all areas designated by Landlord for the exclusive use of Tenant. The boundaries and location of the Premises are depicted on the site plan of the Entire Premises, which is attached hereto as Exhibit A (the “Site Plan”) and shall be deemed to include the entryway to such building. The site plan and shape and dimensions of the area of the Premises are depicted on Exhibit A.
      Section 2.02. Reservations.
     Landlord reserves the right at any time to make alterations or additions and to construct other buildings, improvements, alterations or additions in the Entire Premises. These alterations and additions however shall not materially impede reasonable access to the Premises. Easements for light and air are not included in the Premises.
UNION CITY ENTERTAINMENT CENTER

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Landlord further reserves the right to go on the roof of the Premises for the purpose of effecting certain items of repair and maintenance as provided in this Lease.
      Section 2.03. Right to Relocate.
     Landlord reserves the right at any time to make changes to the various buildings, parking, and other common areas as shown on the Site Plan.
      Section 2.04. Conditions of Record.
     Landlord’s Title is subject to: (a) the effect of any covenants, conditions, restrictions, easements, development agreements, mortgages or deeds of trust, ground leases, rights of way, and other matters or documents of record now or hereafter recorded against Landlord’s title, (b) the effects of any zoning laws of the city, county and state where the Entire Premises is situated, and (c) general and special taxes and assessments not delinquent. Tenant agrees (1) that as to its leasehold estate it, and all persons in possession or holding under it, will conform to and will not violate said matters of record, and (ii) that this Lease is and shall be subordinate to said matters of record and any amendments or modifications thereto.
ARTICLE III
TERM
      Section 3.01. Commencement of Term.
     This Lease shall be effective upon mutual execution. The term of this Lease the (“Term”) shall commence as specified in Section 1.02.2 and shall continue for the term specified in Section 1.02.3 unless sooner terminated in accordance with the provisions of this Lease. The term shall commence from the first day of the month following the Rent Commencement Date. Upon request of Landlord, Tenant shall execute a written confirmation of the commencement of the Term and the Rent Commencement Date upon a form to be supplied by Landlord.
      Section 3.02. Extension of Term.
     Tenant shall have the right to extend the term of this Lease for ***      additional ***      period(s) and ***      additional ***      period under the same terms and conditions as the original Lease, except for the amount of Minimum Rent. It is understood that this option is unique to Century Theatres, Inc., and upon any assignment or subletting without Landlord’s consent, the option shall be rendered null and void. If Tenant is in default on the date of giving the option notice, the option notice shall be totally ineffective, or if Tenant is in default on the date the extended term is to commence, the extended term shall not commence and this Lease shall expire at the end of the initial term.
     In order to exercise such option to renew or extend this Lease, Tenant shall give to Landlord notice, in writing, of its intention to do so at least one hundred eight (180) days prior to then applicable expiration date of this Lease, and if Tenant shall fail to timely give such notice, all rights and privileges as granted to Tenant to renew or extend this Lease shall thereupon be null and void.
ARTICLE IV
RENT
      Section 4.01. Rent Commencement Date.
     Tenant’s obligation to pay Minimum Rent and Percentage Rent under this Lease shall commence on the first to occur of (the “Rent Commencement Date”): (a) the date Tenant first opens for business to the public in the Premises; or (b) nine months after Tenant has obtained a building permit for the construction of Tenant’s Building. If the Rent Commencement Date does not occur on the first day of the month, Tenant shall pay rent for the fractional month on a per diem basis (calculated on the basis of a thirty day month) until the first day of the month next succeeding the date Tenant’s obligation to pay rent commences. The Minimum Rent shall be paid thereafter in equal monthly installments on or before the first day of each month in advance without demand or offset. The Minimum Rent to be paid by Tenant during the Term of this Lease is set forth in Section 1.02.6
      Section 4.02. Percentage Rent
     In addition to the payment of Annual Minimum Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      of the Gross Receipts for such Lease year exceeds the Annual Minimum Rent which is payable for such Lease Year. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross Receipts for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Gross Receipts for the first Lease Year.
     Within sixty (60) days following the end of each Lease Year, Tenant shall deliver to Landlord the written statement required by Section 6.02 of this Lease showing Tenant’s Gross Receipts for the preceding lease year. Tenant shall at the time of delivery of the written statement pay to Landlord any Percentage Rent due for such Lease Year.
      Section 4.03. Gross Receipts Defined.
     “Gross Receipts” means (a) the entire amount charged for the full price at the time of the initial transaction for all merchandise sold or delivered or services rendered by Tenant whether for cash or credit; (b) the gross amount received or charged by Tenant for merchandise sold or services rendered pursuant to orders received by telephone,
UNION CITY ENTERTAINMENT CENTER

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mail, house to house, or by other canvassing, and attributable to the Premises whether or not filled elsewhere; and (c) all gross income of Tenant from any operation in, at, from or through the use of the Premises. Excluded from the calculation of “Gross Receipts” are (i) cash refunded or credit allowed on merchandise returned by customers; (ii) sales taxes, excise taxes, other similar taxes; (iii) proceeds from sales of fixtures, equipment, or property which are not stock-in-trade; (iv) sales to employees representing discounts or compensation benefits and for which Tenant realizes no monetary profit in an amount not to exceed two percent (2%) of Gross Receipts and (v) EBF passes.
      Section 4.04. Additional Rental.
     All other sums required to be paid by Tenant to Landlord pursuant to this lease in addition to Minimum Rent and Percentage Rent, whether or not designated as rent and additional rent, unless otherwise specified. Rent for any period which is less than one (1) month shall be a prorated portion of the monthly rent installment based upon a thirty (30) day month.
      Section 4.05. Late Payment.
     If the Tenant fails to pay the Minimum Rent or any installment thereof or Percentage Rent, if any, or any other additional rent due under this Lease within five (5) days after such Rent has become due, both Tenant and Landlord agree that Landlord will incur additional expenses consisting of extra collection efforts, handling costs and potential impairment of credit on loans which may be secured by this Lease. Both parties agree that should Tenant fail to pay its Rent, Landlord is entitled to compensation for detriment caused by the failure, but that it is extremely difficult and impractical to ascertain the extent of the detriment. The parties therefore agree that should Tenant fail to pay any Rent due hereunder within five (5) days after the same becomes due, Landlord shall be entitled to recover from Tenant five percent (5%) of the amount past due as liquidated damages. Such past due amounts shall also bear interest at the maximum rate allowed by law from the date due until paid. Tenant further agrees to pay Landlord any costs incurred by Landlord in the collection of such past due Rent including, but not limited to, fees of an attorney and/or collection agency. Nothing herein contained shall limit any other remedy of Landlord under this Lease. Landlord shall also have the right to require Tenant to pay any past due sums by cashier’s check or money order.
     Further, should Tenant fail to pay Rent or any other charges due hereunder in the time periods set forth herein, two (2) or more times during any calendar year of the Term, Landlord may require Tenant to thereafter pay Rent in quarterly installments in advance for the balance of the Term.
ARTICLE V
CONSTRUCTION OF LEASED PREMISES
      Section 5.01. Landlord’s and Tenant’s Obligations.
     (a) Landlord’s Obligation:
          Subject to delay as provided in this Lease, Landlord, at its own cost and expense, shall develop the building pad in accordance with plans and specifications prepared by Tenant or Tenant’s architect, including the design and construction of all utility lines to the boundary of the Premises in adequate size to service Tenant’s requirements.
     (b) Tenant’s Obligation:
          Tenant shall construct the theatre building and improvements in accordance with plans and specifications prepared by Tenant. Any work to be performed by Tenant and any permits, fees or applications for such work shall be performed or obtained by Tenant at its sole cost and expense (collectively, “Tenant’s Work”). Tenant shall pay for any equipment or work to be installed in or constructed on the Premises by Landlord other than Landlord’s Work prior to commencement of construction or installation of such additional items.
     (c) Tenant’s Allowance.
          Landlord agrees to provide Tenant with an improvement allowance of up to a maximum of Eight Million One Hundred Sixty Thousand ($8,160,000.00) dollars ($85 per square foot) (“Tenant Allowance”). Tenant shall pay any difference between the total Tenant building and improvement cost less the Tenant Allowance. Landlord agrees that it shall pay to Tenant, or at Tenant’s direction, to Tenant’s contractor, within fifteen (15) days following Landlord’s receipt of conditional lien waivers signed by its contractor, in form reasonably sufficient to waive lien rights in Alameda County, California, an amount equal to the Tenant Allowance multiplied by the percentage of work completed as of the date of the lien waivers, less any installments of Tenant Allowance already paid. If the total contract for Tenant’s Work exceeds Tenant’s Allowance, Landlord shall only be required to pay its pro-rata share which shall be the ratio of Tenant’s Allowance to the total of Tenant’s Work. If Landlord disputes any portion of the request for payment by Tenant due to faulty or incomplete work, then Landlord shall withhold a sum which, in Landlord’s opinion would be required to correct or complete the disputed work. In this event, Landlord shall submit a written “punch list” to Tenant.
     Anything above to the contrary notwithstanding, Landlord shall have no obligation to pay any portion of the construction allowance if Tenant is then in default of any of the terms and provisions of this Lease.
      Section 5.02. Possession.
     Upon substantial completion by Landlord of Landlord’s Work on the Premises, Landlord shall deliver the Premises to Tenant. Tenant waives any right or claim against the Landlord for any cause directly or indirectly, arising out of the condition of the Premises, appurtenances thereto, the improvements thereon and the equipment
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thereof. Tenant shall save and hold harmless the Landlord from liability as provided in this Lease. Landlord shall not be liable for any latent or patent defects therein.
      Section 5.03. Commencement of Construction and Completion.
     Prior to commencement of Tenant’s Work, Tenant shall notify Landlord in writing of the date Tenant will commence construction. Tenant’s contractor shall commence the construction of Tenant’s Work promptly upon possession of the Premises by Tenant and shall diligently pursue such construction to completion. Tenant shall record within ten (10) days of completion of Tenant’s Work, a valid Notice of Completion and thereafter deliver to Landlord prior to opening for business a certified copy of such Notice along with final lien releases for all contractors, subcontractors, materialmen and suppliers covering all improvements and work performed by Tenant and/or Tenant’s contractor on the Premises.
      Section 5.04. Delay in Possession
     Landlord shall not be liable for failure to deliver possession of the Premises to Tenant. If Landlord fails to deliver possession of the Premises on or before the expiration of two (2) years from the date of lease execution (subject to extension for any force majeure or inability to obtain financing), either party may terminate this Lease by giving thirty (30) days written notice to the other party. Thereafter, neither party shall have any further liability to the other in connection with this Lease.
ARTICLE VI
RECORDS AND BOOKS OF ACCOUNT
      Section 6.01. Tenant’s Records.
     Tenant shall maintain and keep on the Premises or at Tenant’s principal office in California for a period of not less than three (3) years following the end of each year during the Term, adequate records which show Gross Receipts, inventories and receipts of merchandise at the Premises, and daily receipts from all sales and other transactions on the Premises by Tenant and any other persons conducting any business upon the Premises. Tenant shall record at the time of sale, in the presence of the customer, all receipts from sales or other transactions, whether for cash or credit, in a cash register or in cash registers having a cumulative total which shall be sealed in a reasonable manner, and having such other reasonable features as may be appropriate or required in order to properly account for and record all sales or other transactions in and from the Premises. If upon an audit of Tenant’s books and records by Landlord, Landlord determines that Tenant’s manner of recording sales is inadequate, Tenant agrees to adopt such measures as Landlord may reasonably request to correct such inadequacies. Tenant further agrees to keep on the Premises or at Tenant’s principal office in California for at least three (3) years following the end of each year during the Term all pertinent original sales records. Original sales records may include any or all of the following: (a) cash register tapes, including tapes from temporary registers; (b) serially numbered sales slips; (c) computer printouts and computerized sales slips; (d) the originals of all mail orders at and to the Premises; (e) the original records of all telephone orders at and to the Premises; (f) settlement report sheets of transactions with subtenants, concessionaires and licensees; (g) the original records showing that merchandise returned by customers was purchased at the Premises by such customers; (h) memorandum receipts or other records of merchandise taken out on approval; (i) records of inventory purchases; (j) such other sales records, if any, which would normally be examined by an independent accountant pursuant to generally accepted auditing standards in performing an audit of Tenant’s Gross Receipts; and (k) the records specified in (a) to (j) above for subtenants, assignees, concessionaires or licensees of Tenant.
      Section 6.02. Reports by Tenant.
     Tenant shall submit to Landlord on or before the sixtieth (60th) day following each lease year during the Term hereof at the place then fixed for the payment of rent, or at such other place designated by Landlord, a written statement signed by Tenant, and certified by it to be true and correct, showing in reasonable, accurate detail, the amount of Gross Receipts for each preceding year.
     Tenant shall submit to Landlord on or before the sixtieth (60th) day following the end of each lease year at the place then fixed for the payment of rent, a written statement signed by Tenant, and certified to be true and correct showing in reasonably accurate detail satisfactory in scope to Landlord, the amount of Gross Receipts during the preceding calendar year. At Landlord’s option, the written statement shall be duly certified to Tenant and Landlord by independent certified public accounts of recognized standing. The accounting statement referred to in this Section 6.02 shall be in such form and style and contain such details and breakdown as the Landlord may reasonably require.
     If Tenant fails to timely submit to Landlord either the monthly or annual written statement described in this Section 6.02, Tenant shall pay to Landlord, as additional rent and without limiting any other remedy Landlord may have against Tenant under this lease as a result of this breach, a $100.00 (increased each year according to the Index) charge for each and every month that the Tenant fails to timely submit such written statement. Alternatively, Landlord shall have the right, upon five (5) days written notice, to audit Tenant’s records at Tenant’s expense.
      Section 6.03. Annual Balance Sheet
     Tenant shall provide Landlord, whenever reasonably requested by Landlord, a current annual balance sheet for Tenant’s business at the Premises, either certified by Tenant or if Tenant is a corporation, by Tenant’s chief financial officer, to be true and correct or accompanied by a report of an independent certified public accountant.
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ARTICLE VII
AUDIT
      Section 7.01. Right to Examine Books.
     The acceptance by Landlord of payments of Percentage Rent shall be without prejudice to Landlord’s right to examine Tenant’s books and records concerning Gross Receipts from the Premises.
      Section 7.02. Audit.
     As its option, Landlord may cause, at any reasonable time and upon five (5) days prior written notice to Tenant, a complete audit to be made of Tenant’s entire business affairs and records relating to the Premises for the period covered by any statement issued by the Tenant in accordance with Section 6.02. If such audit discloses that Tenant has under-reported Gross Receipts by more than three percent (3%) for such period, Tenant shall promptly pay to Landlord within ten (10) days the cost of its audit and any deficiency in amounts owed as disclosed by the audit. The deficiency shall be considered a late payment pursuant to Section 4.06. In the event that Tenant is in default of this Lease by
under-reporting Gross Receipts by more than three percent (3%) as determined by two successive audits, Landlord may terminate this Lease upon five (5) days written notice to Tenant. In such event, Landlord shall have all remedies set forth in Section 22.02.
ARTICLE VIII
TAXES
      Section 8.01. Real Property Taxes.
     Tenant agrees to pay its pro rata share of all general and special real property taxes and assessments and governmental levies and charges of any and every kind, nature and sort whatsoever, ordinary and extraordinary, foreseen and unforeseen, and substitutes therefor or supplements thereto, including the cost to Landlord of any appeals or contests of any taxes or assessments, except any inheritance, estate, succession, transfer or gift tax imposed on Landlord or any income tax specifically payable by Landlord as a separate tax-paying entity without regard to Landlord’s income source as arising from or out of the Entire Premises (collectively “Real Property Taxes”), which may be levied or assessed by any lawful authority against the Entire Premises applicable to the period from the commencement of the Term until the expiration or sooner termination of this Lease. Tenant’s pro rata share shall be apportioned according to the floor area of the Premises as it relates to the total leasable floor area of the Building or buildings located within the Entire Premises (including the Premises). Notwithstanding the foregoing provisions, if the Real Property Taxes are not levied and assessed against the Entire Premises by means of a single tax bill (i.e., if the Entire Premises is separated into two (2) or more separate tax parcels for purposes of levying and assessing the Real Property Taxes), then, at Landlord’s option, Tenant shall pay Tenant’s pro rata share of all Real Property Taxes which may be levied or assessed by any lawful authority against the land and improvements of the separate tax parcel on which the Building containing the Premises is located. Tenant’s pro rata share under such circumstances shall be apportioned according to the floor area of the Premises as it relates to the total leasable floor area of the Building or buildings situated in the separate parcel in which the Premises are located.
     All Real Property Taxes for the tax year in which the Term commences and for the tax year in which this Lease terminates shall be apportioned and adjusted so that Tenant shall not be responsible for taxes and assessments for a period of time occurring prior to the time the Term commences or subsequent to the Term.
     The amount to be paid pursuant to the provisions of this Section 8.01 shall be paid monthly in advance without demand or offset as estimated by Landlord based on the most recent tax bills and estimates or reappraised values (if reappraisal is to occur), commencing with the month (or partial month on a prorated basis if such be the case) that the Term commences.
     If at any time during the Term, a tax, fee or excise is levied or assessed by any political body against Landlord on account of rent payable to Landlord hereunder, the square footage of the Premises, the act of entering into this Lease or the occupancy of Tenant or any other tax however described or any tax based on or measured by expenditures made by Tenant on behalf of Landlord, including the so-called value added tax, such tax, fee or excise shall be considered “Real Property Taxes” for purposes of this Section 8.01, and shall be payable in full by Tenant. At Landlord’s option, such taxes, fees or excises shall be payable monthly in advance on an estimated basis as provided in this Section 8.01 or shall be payable within ten (10) days after Tenant’s receipt of the tax bill therefor from Landlord.
      Section 8.02. Increase in Taxes.
     In addition to the Real Property Taxes described above in Section 8.01, Tenant shall pay one hundred percent (100%) of any increase in Real Property Taxes as a result of any Tenant’s Work or any other leasehold improvements, alterations or changes made by Tenant to the Premises during the Term. Tenant shall reimburse Landlord promptly upon demand.
      Section 8.03. Personal Property Taxes.
     Tenant shall pay prior to delinquency all federal, municipal, county or state taxes, charges, assessments and fees assessed during the Term against any leasehold interest or personal property of any kind, owned by or placed in, upon or about the Premises by Tenant.
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ARTICLE IX
SECURITY DEPOSIT
      Intentionally deleted.
ARTICLE X
CONDUCT OF BUSINESS BY TENANT
      Section 10.01. Use of Premises.
     Tenant shall use the Premises solely for the use and under the trade name specified in Sections 1.02.9 and 1.02.4, respectively, herein, and for no other purpose. The term “Use” shall mean the operation of a motion picture theatre complex, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games, operation of concession stands, sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
     Tenant shall not (a) do or permit anything to be done in or about the Premises which will in any way obstruct or interfere with the rights of other occupants of the Entire Premises or injure or annoy them, (b) cause, maintain or permit any nuisance in, on or about the Premises, (c) use or allow the Premises to be used for any unlawful purpose, (d) commit or allow to be committed any waste in or upon the Premises, (e) display or allow carts, pallets or similar items owned by or within the control of Tenant or Tenant’s merchandise to be stored or to remain outside the defined exterior walls and permanent doorways of the Premises, (f) install any exterior lighting, amplifier or similar devices, or use in or abut the Premises any advertising medium or device which may be heard or seen outside the Premises, such as flashing lights, search lights, loud speakers, phonographs or radio broadcasts, (g) permit to be conducted any sale by auction in, upon or from the Premises whether voluntary, involuntary, pursuant to any assignment for the payment of credits pursuant to any bankruptcy or any other insolvency proceedings, or any distress or fire or bankruptcy or going-out-of-business sale, or (h) conduct any sidewalk sale. Tenant shall at all times keep the Premises in a neat and attractive appearance.
     Tenant shall not use, or permit the Premises, or any part thereof, to be used for any purposes other than the purposes for which the Premises are hereby leased. No gaming machines shall be permitted on the Premises. No use shall be made or permitted to be made of the Premises, nor acts done, which will increase the existing rate of insurance upon the building or the Entire Premises, or cause a cancellation of any insurance policy covering the building or the Entire Premises or any part thereof. Tenant shall not sell or permit to be kept, used, stored or sold in or about the Premises any article which may be prohibited by standard form fire insurance policies. Tenant, at its sole cost, shall comply with any and all laws concerning the Premises or Tenant’s use of the Premises, including, without limitation, the obligation at Tenant’s cost to alter, maintain or improve the Premises in compliance with and conformity with all laws relating to the condition, use or occupancy of the Premises during the term (including the Americans With Disabilities Act). Tenant shall also comply with the requirements of any insurance organization or company necessary for the maintenance of the fire and public liability insurance described in this Lease covering the building and its appurtenances. If Tenant’s use of the Premises results in a rate increase for the building or the Entire Premises, Tenant shall pay with in ten (10) days of billing from Landlord, as additional rent, a sum equal to the additional premium caused by such rate increase.
      Section 10.02. Operation of Business.
     Tenant shall open for business in the Premises no later than the Rent Commencement Date and shall thereafter operate continuously for business to the public in the Premises. Tenant shall operate one hundred percent (100%) of the Premises during the entire Term with due diligence and efficiency so as to maximize the Gross Receipts which may be produced by Tenant’s business therein. Tenant shall carry at all times in the Premises a stock of merchandise of such size, character and quality as shall be reasonably designed to produce the maximum return to Landlord and Tenant. Tenant shall conduct its business in the Premises during the usual and customary days and hours for such type of business, or during times designated by Landlord for other tenants at the Entire Premises. In the latter event, Landlord will notify Tenant in writing of the designated Entire Premises days and hours. Tenant’s obligation to continuously operate its business in the Premises shall not apply if the Premises should be closed and the business of Tenant temporarily discontinued therein for not more than three (3) days out of respect to the memory of any deceased officer or employee of Tenant, or the relative of any such officer or employee. Tenant shall install and maintain at all times displays of merchandise in the display windows (if any) for the Premises. Tenant shall keep the display windows and signs, if any, in the Premises well lighted during the hours from sundown to 11:00 p.m.
     In the event Tenant fails to take possession of the Premises or to open for business fully fixturized, stocked and staffed by the Rent Commencement Date, or fails to fully operate its business in the Premises at any time during the term in accordance with this Section 10.02, then Landlord, in addition to any and all remedies otherwise provided in this Lease, shall have the right to collect a sum equal to the greater of (i) twice the Minimum Rent per day, or (ii) $100.00 for each and every day after the Rent Commencement Date that Tenant shall fail to be open for business in the Premises in accordance with the terms of this Lease. This additional rent is intended to compensate Landlord for loss of Rent that may have been earned during the period Tenant is not open for business, for damages suffered by the Landlord to the Entire Premises as a whole by reason of Tenant’s not being open and for additional costs and expenses that Landlord may incur by reason of increased administrative expenses and security costs for the Entire Premises. Tenant acknowledges and agrees that Landlord is executing this Lease in reliance on Tenant’s covenant and obligation to continuously operate its business in the Premises in accordance with this Lease and that such obligation and covenant to the Landlord is a material element of consideration inducing Landlord to execute this Lease. The foregoing provision for additional rent shall not apply during any temporary closure for a maximum of three (3) days as set forth above, or due to casualty damage or condemnation (in which either event Tenant shall
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recommence the conduct of its business in accordance with the terms of this Lease within the time periods specified in this Lease after restoration and redelivery of the Premises to the Tenant).
      Section 10.03. Competition.
     During the Term, neither Tenant, nor any entity owned or controlled directly or indirectly by Tenant, its partners, shareholders or directors, shall, without the prior written consent of Landlord, directly or indirectly engage in any similar or competing business with that to be operated by Tenant in the Premises within a radius of two (2) miles from the outside boundary of the Entire Premises.
      Section 10.04. Storage, Office Space.
     Tenant shall warehouse, store and/or stock in the Premises, only such goods, wares and merchandise as Tenant intends to offer for retail sale at, in, from or upon the Premises. This shall not preclude occasional emergency transfers of merchandise to the other stores of Tenant, if any, not located in the Entire Premises. Tenant shall use for office, clerical or other non-selling purposes only such space in the Premises as is from time to time reasonably required for Tenant’s business in the Premises.
      Section 10.05. Compliance with Environmental Laws.
     Tenant at all times and in all respects shall comply with all federal, state and local laws, ordinances and regulations (“Hazardous Materials Laws”) relating to industrial hygiene, environmental protection or the use, generation, manufacture, storage, disposal or transportation of any hazardous, toxic, contaminated or polluting materials, substances or wastes, including, without limitation, oil or other petroleum products, flammable explosives, asbestos, or any “hazardous substances,” “hazardous wastes,” “hazardous materials” or “toxic substances” regulated under any Hazardous Material Law (collectively, “Hazardous Materials”). Tenant at its own expense shall procure, maintain in effect and comply with all conditions of any and all permits, licenses and other governmental and regulatory approvals required for Tenant’s use of the Premises. In all respects, Tenant shall handle, treat, deal with, manage and dispose of any and all Hazardous Materials in total conformity with all applicable Hazardous Materials Laws and prudent industry practices. Upon expiration or earlier termination of the term of the Lease, Tenant shall cause all Hazardous Materials to be removed from the Premises and transported for use, storage, or disposal in accordance and compliance with all applicable Hazardous Materials Laws. If Tenant fails to do so, Landlord may remove such Hazardous Materials at Tenant’s expense.
     If at any time it reasonably appears to Landlord that Tenant is not maintaining sufficient insurance or other means of financial capacity to enable Tenant to fulfill its obligations to Landlord in connection with this Section 10.05, whether or not then accrued, liquidated, conditional or contingent, Tenant shall procure and thereafter maintain in full force and effect such insurance or other form of financial assurance, with or from companies or persons and in forms reasonably acceptable to Landlord, as Landlord may from time to time reasonably request.
      Section 10.06. Sewer Damage
     Tenant agrees not to discharge any acid or other harmful or dangerous chemicals into the sewer system, whether it be inside the Premises area or inside the main system leading from the Premises to the main sewer line. Should Tenant discharge any acid or harmful chemicals into the sewer system, Tenant shall be, fully responsible for the cost and repair of such damage. Landlord reserves the right to select an expert of its choosing to inspect any damage at Tenant’s cost. Tenant shall not be responsible for cost of expert if it is determined such damage is not caused by Tenant. Tenant accepts responsibility for any damage if the following conditions exist: (a) the damage to the sewer system is determined to be due to the chemicals used in the operation of Tenant’s business; (b) the damage exists only in the designated portion of the sewer system.
      Section 10.07. Tenant’s Use No Nuisance
     Tenant acknowledges that odors emanating from the Premises as a result of Tenant’s operation can become a nuisance to other Tenants within the Entire Premises. Therefore, Tenant agrees to take whatever measures are necessary to eliminate odors emanating from the leased premises at Tenant’s sole cost and expense. If the odor problem is not remedied by Tenant, Landlord has the right to have odor nuisance inspected and remedied by an expert of Landlord’s and Tenant’s choosing at Tenant’s sole cost.
      Section 10.08. Tenant’s Covenant
     The Tenant herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions.
     “That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subleases, subtenants or vendees in the premises herein leased.”
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ARTICLE XI
MAINTENANCE AND REPAIRS
      Section 11.01. Tenant’s Maintenance Obligations.
     Tenant, at its sole cost and expense, shall keep the Premises in first class order, condition and repair and shall make all replacements necessary to keep the Premises including the theatre building and improvements in such condition. All replacements shall be of a quality equal to or exceeding that of the original. Should Tenant fail to make these repairs and replacements or otherwise so maintain the Premises for a period of three (3) days after written demand by Landlord, or should Tenant commence, but fail to complete, any repairs or replacements within thirty (30) days after written demand by Landlord, Landlord may enter the Premises and make such repairs or replacements without liability to Tenant for any loss or damage that may occur to Tenant’s stock or business, and Tenant shall pay to Landlord the costs incurred by Landlord in making such repairs or replacements together with interest thereon at the maximum rate permitted by law from the date of commencement of the work until repaid. Tenant, at its expense, shall repair promptly any damage to the building or the Entire Premises caused by Tenant or its agents or employees or caused by the installation or removal of Tenant’s personal property. Tenant shall contract with a service company licensed and experienced in servicing HVAC equipment and approved by Landlord for the quarterly maintenance of the HVAC equipment serving the Premises and shall provide Landlord with a copy of the service contract within ten (10) days following its execution. If Tenant fails to timely deliver a copy of the service contract, Landlord may impose a late charge in the amount of $50.00 per month until the copy is delivered. The sum so billed to Tenant shall become immediately due to Landlord as additional rent. Landlord, at its option, may contract with a service company of its own choosing, or provide such service itself, for the maintenance of the HVAC equipment, and bill Tenant for the cost of same.
     Tenant, at its own expense, shall comply with all requirements for the installation and periodic maintenance of the fire extinguisher or automatic dry chemical extinguishing system.
      Section 11.02. Plate Glass.
     Tenant shall promptly replace, at its expense, any and all plate and other glass damaged or broken from any cause whatsoever (except Landlord’s direct act) in and about the Premises. Tenant shall have the option either to insure this risk or self insure.
ARTICLE XII
COMMON AREA
      Section 12.01. Definition of Common Area.
     The term “Common Area,” as used in this Lease means all areas within the exterior boundaries of the Entire Premises now or later made available for the general use of Landlord and other persons entitled to occupy floor area in the Entire Premises. Without limiting this definition, Landlord may include in the Common Area those portions of the Entire Premises presently or later sold or leased until the commencement of construction of building(s) thereon, at which time such areas shall be withdrawn from the Common Area. Common Area shall not include (a) the entryway to a tenant’s premises, (b) any improvements installed by a tenant outside of its premises, whether with or without Landlord’s knowledge or consent, or (c) any areas or facilities that could be considered as Common Area except that the areas or facilities are included in the description of premises leased to a tenant.
      Section 12.02. Maintenance and Use of Common Area.
     The manner in which the Common Area shall be maintained shall be solely determined by Landlord. If any tenant of any portion of the Entire Premises maintains its own Common Area (Landlord shall have the right in its sole discretion to allow any tenant to so maintain its own Common Area and be excluded from participation in the payment of Common Area Expenses as provided below), Landlord shall not have any responsibility for the maintenance of that portion of the Common Area; Tenant hereby waives any claims or damages arising out of any failure of such Landlord or tenant to so maintain its portion of the Common Area.
     The use and occupancy by Tenant of the Premises shall include the right to use the Common Area (except those portions of the Common Area on which have been constructed or placed permanent or temporary kiosks, displays, carts and stands and except areas used in the maintenance or operation of the Entire Premises), in common with Landlord and tenants of the Entire Premises and their customers and invitees, subject to such reasonable, nondiscriminatory rules and regulations concerning the use of the Common Area as may be established by Landlord from time to time. Written notice of such rules and regulations and amendments and supplements thereto, if any, shall be given to Tenant fifteen (15) days prior to their effective date. Tenant agrees to promptly comply with all such rules and regulations upon receipt of written notice from Landlord. Landlord shall have no liability if any Landlord or tenant does not comply with such rules and regulations.
     Tenant and Tenant’s employees and agents shall not solicit business in the Common Areas, nor shall Tenant distribute any handbills or other advertising matter on automobiles parked in the Common Area.
      Section 12.03. Control of and Changes to Common Area.
     Landlord shall have the sole and exclusive control of the Common Area. Landlord’s rights shall include, but not be limited to, the right to (a) restrain the use of the Common Area by unauthorized persons; (b) cause Tenant to remove or restrain persons from any unauthorized use of the Common Area if they are using the Common Area by reason of Tenant’s presence in the Entire Premises; (c) utilize from time to time any portion of the Common Area for promotional, entertainment and related matters; (d) place permanent or temporary kiosks, displays, carts and
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stands in the Common Area and to lease same to tenants; (e) temporarily close any portion of the Common Area for repairs, improvements or alterations, to discourage non-customer use, to prevent dedication or an easement by prescription, or for any other reason deemed sufficient in Landlord’s judgment; and (f) reasonably change the shape and size of the Common Area, add, eliminate or change the location of improvements to the Common Area, including, without limitation, buildings, lighting, parking areas, roadways and curb cuts, and construct buildings on the Common Area. Landlord may determine the nature, size and extent of the Common Area and whether portions of the same shall be surface, underground or multiple-deck; as well as make changes to the Common Area from time to time which in Landlord’s opinion are deemed desirable for the Entire Premises. Landlord’s right in this Section 12.03 may be shared in common with other Landlords of the Entire Premises.
      Section 12.04. Common Area Expenses.
     The term “Common Area Expenses” as used in this Lease means all costs and expenses incurred by Landlord, in operating, managing, policing, insuring, replacing, repairing and maintaining the Common Area and, if applicable, the security offices and management offices, located in the Entire Premises from time to time (the “Common Facilities”), and operating, insuring, repairing, replacing and maintaining the Common Utility Facilities. “Common Utility_Facilities” are defined to include but are not limited to, sanitary sewer lines and systems, gas lines and systems, water lines and systems, fire protection lines and systems, electric power, telephone and communication lines and systems, and storm drainage and retention facilities not exclusively serving the premises of any tenant or store located in the Entire Premises. Common Area Expenses shall include, without limitation, the following: expenses for maintenance, landscaping, repaving, resurfacing, repairs, replacements, painting, lighting, cleaning, trash removal, security, fire protection and similar items; cost, installation and removal of seasonal decorations; non-refundable contributions toward one or more reserves for replacements other than equipment; rental on equipment; charges, surcharges and other levies related to the requirements of any Federal, State or local governmental agency; costs of any improvements made by Landlord to the Entire Premises for the purpose of reducing recurring expenses or utility costs and from which Tenant can expect a reasonable benefit or that are required by any governmental law, ordinance, regulation or mandate subsequent to the original construction of the Entire Premises; expenses related to the Common Utility Facilities; real and personal property taxes and assessments on the improvements and land comprising the Common Area and Common Facilities; Landlord Carried Insurance (defined in Section 16.02) and any additional coverage obtained by Landlord on the Entire Premises; and a sum payable to Landlord for administration and overhead in an amount equal to ten percent (10%) of the Common Area Expenses for the applicable year.
      Section 12.05. Proration of Common Area Expenses.
          (a) From and after the commencement of the Term, Tenant shall pay to Landlord, on the first day of each calendar month, without demand or offset, an amount estimated by Landlord to be the monthly amount of Tenant’s share of the Common Area Expenses which shall also include Tenant’s pro rata share of Real Property Taxes described in Section 8.01 (“Monthly Impound”). The Monthly Impound may be adjusted periodically by Landlord based on Landlord’s reasonable estimate of anticipated costs.
          (b) Within one hundred twenty (120) days following the end of each calendar year of the Term, or, at Landlord’s option, its fiscal year, Landlord shall furnish Tenant with a statement covering the calendar or fiscal year (as the case may be) just expired, showing the actual Common Area Expenses for that year, the amount of Tenant’s share of Common Area Expenses for said calendar or fiscal year and the Monthly Impound payments made by Tenant during that year. If Tenant’s share of the Common Area Expenses exceeds Tenant’s prior Monthly Impound payments, Tenant shall pay Landlord the deficiency within ten (10) days after receipt of the annual statement. If Tenant’s Monthly Impound payments for the calendar or fiscal year exceed Tenant’s actual share of Common Area Expenses, and provided Tenant is not in arrears as to the payment of any Rent, Tenant may offset the excess against the next Monthly Impound due Landlord.
          (c) Tenant’s proportionate share of the Common Area Expenses shall be determined by multiplying the amount of such expenses by a fraction, the numerator of which is the number of square feet of leasable floor area in the Premises and the denominator of which is the number of square feet of leasable floor area in the Entire Premises.
      Section 12.06. Parking
     Tenant and its employees shall park their vehicles only in those portions of the Common Area from time to time designated for such purpose by Landlord. Landlord, at Tenant’s expense, shall have the right to tow improperly parked vehicles of Tenant or Tenant’s employees. Tenant shall reimburse Landlord upon demand for any such towing costs. Landlord shall have the right to adopt and implement such parking programs as may be necessary to alleviate parking problems during the peak traffic periods, including requiring the use of off-site parking. Tenant shall pay to Landlord its proportionate share of the cost of any such off-site parking program based on the ratio of the floor area of the Premises to the total floor area of the premises of all tenants in the Entire Premises required to participate in such program.
     Tenant shall furnish Landlord with a list of its employees and the license numbers of their vehicles within fifteen (15) days after Tenant opens for business in the Premises. Tenant shall be responsible for ensuring that its employees comply with all the provisions of this Section 12.06 and such other parking rules and regulations as may be adopted and implemented by Landlord from time to time, including but not limited to systems of validation, shuttle transportation or any other programs which may be deemed necessary or appropriate by Landlord to control, regulate or assist parking by customers of the Entire Premises.
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ARTICLE XIII
UTILITIES
      Section 13.01. Utility Charges.
     Tenant shall be solely responsible for and shall promptly pay all charges for heat, water, gas, electricity, fire sprinkler, fire alarm or any other utility used, consumed or provided in, or furnished, or attributable to the Premises at the rates charged by the supplying utility companies. Should Landlord elect to supply any or all of such utilities, Tenant agrees to purchase and pay for the same as additional rent as apportioned by the Landlord. The rate to be charged by Landlord to Tenant shall not exceed the rate charged Landlord by any supplying utility plus any expenses incurred by Landlord in connection with billing and supplying such utility service to Tenant. In no event shall Landlord be liable for any interruption or failure in the supply of any such utilities to the Premises. Tenant agrees to reimburse Landlord within ten (10) days of billing for fixture charges and/or water tariffs, if applicable, which are charged by local utility companies. Landlord will notify Tenant of this charge as soon as it becomes known. This charge will increase or decrease with current charges being charged Landlord by the local utility company, and will be due as additional rent. Tenant shall be responsible for sewer hook-up fees associated with Tenant’s use of the Premises.
ARTICLE XIV
ALTERATIONS AND SIGNS
      Section 14.01. Installation.
     Tenant shall not make or cause to be made any alterations, additions or improvements or install or cause to be installed any trade fixtures, exterior signs, floor covering, interior lighting, plumbing fixtures, shades or awnings or make any changes to the storefront of the Premises without Landlord’s prior written consent. Concurrently with the request for approval, Tenant shall deliver to Landlord two (2) sets of complete plans and specifications for such work prepared by a licensed architect and if applicable, engineer. If required by Landlord, Tenant shall also provide security for the lien free completion of such work in the form of a payment and performance bond or other security satisfactory to Landlord.
      Section 14.02. Removal by Tenant.
     All alterations, decorations, additions and improvements made by the Tenant, or made by the Landlord on the Tenant’s behalf by agreement under this Lease, shall remain the property of the Tenant for the Term, or any extension or renewal thereof. Any alterations, decorations, additions and improvements made by Tenant or previous tenant, if applicable, shall not be removed from the Premises without Landlord’s prior written consent. During the Term, Tenant shall not remove any of its trade fixtures or other personal property, without the immediate replacement thereof with comparable fixtures or property. Upon expiration of this Lease, or any renewal term thereof, at Landlord’s option, Tenant shall remove all such alterations, decorations, additions, and improvements, and restore the Premises as provided in Section 15.01 hereof. If the Tenant fails to remove such alterations, decorations, additions and improvements and restore the Premises, then upon the expiration of this Lease, and upon Tenant’s vacation of the Premises, all such alterations, decorations, additions and improvements shall become the property of Landlord and Tenant shall reimburse Landlord for the cost of removal and/or storage of such alterations, decorations, additions and improvements.
      Section 14.03. Liens.
     Tenant shall keep the Premises free from any kinds of liens arising out of work performed or materials furnished Tenant and shall promptly pay all contractors and materialmen used by Tenant to improve the Premises, so as to minimize the possibility of a lien attaching thereto. If any such lien be made or filed, Tenant shall bond against or discharge the same within ten (10) days after written request by Landlord.
     Tenant shall indemnify, defend, protect and hold Landlord, any ground lessor, the Premises and the Entire Premises and every part thereof free and harmless from and against any and all liability, damage, claims, demands, suits, actions or expense (including attorneys’ fees) arising out of any work done on or about the Premises by Tenant or, at Tenant’s direction, including Tenant’s employees, representatives, successors, contractors, subcontractors, materialmen and assigns.
      Section 14.04. Signs, Awnings and Canopies.
     Tenant shall conform to the Union City Entertainment Center Tenant Sign Criteria. In addition, Tenant shall not place or suffer to be placed or maintained any sign, awning, canopy, or advertising matter on the roof or on any exterior surface, door, wall or window or within 48 inches of any windows or doors of the Premises or the Building without Landlord’s prior written consent. If Landlord consents, Tenant agrees to maintain such sign, awning, canopy, decoration, lettering or advertising matter in good condition and repair at all times.
     Tenant agrees, at Tenant’s sole cost to install and maintain any signs as required by Landlord in strict conformance with Landlord’s sign criteria as to design, material, color, location, size and letter style and, if requested by Landlord, from the source designated by Landlord. Tenant’s sign shall be installed prior to Tenant’s opening for business and shall thereafter be maintained by Tenant at its own expense. If Tenant fails to maintain such sign, Landlord may do so and Tenant shall reimburse Landlord for such cost plus a twenty percent (20%) overhead fee. If, without Landlord’s prior written consent, Tenant installs a sign that does not conform to the Sign Criteria, Landlord may have Tenant’s sign removed and stored at Tenant’s expense. The removal and storage costs shall bear interest until paid at the maximum rate allowed by law.
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     Landlord reserves the right to revise the Sign Criteria, at any time. Within ninety (90) days of Landlord’s request and provided that Tenant has been in occupancy of the Premises for at least five (5) years, Tenant shall remove Tenant’s existing sign, patch the fascia, and install a new sign, at Tenant’s sole cost and expense, in accordance with Landlord’s new sign criteria.
ARTICLE XV
SURRENDER OF PREMISES
      Section 15.01. Surrender of Premises.
     At the expiration of the tenancy hereby created, Tenant shall surrender the Premises in a first class, clean condition in accordance with the requirements of Section 14.02 herein, except for reasonable wear and tear and damage by unavoidable casualty to the extent covered by Landlord Carried Insurance. Tenant shall remove all of its trade fixtures, and any alterations or improvements if required as provided in Section 14.02 hereof, before surrendering the Premises to Landlord and shall repair any damage to the Premises or Building caused thereby. Tenant shall also remove its sign and patch the fascia. Tenant’s covenants shall survive the expiration or other termination of this Lease.
     If the Premises were occupied by other tenants prior to the commencement of the Term, then Tenant, upon Landlord’s written request at the expiration of the Term, shall remove all or a portion of, as designated by Landlord, the interior improvements made by the prior tenants, and deliver the Premises in a condition acceptable to Landlord.
     Following removal of all improvements as required by Section 15.01, Landlord shall conduct an inspection of the Premises to confirm Tenant’s compliance with this Section. Tenant shall send written notice to Landlord five days prior to Landlord’s inspection. Landlord’s inspection shall occur no later than the last day of the Term. During the inspection, Tenant shall surrender all keys for the Premises to Landlord and shall inform Landlord of all combinations on locks, safes and vaults, if any, in the Premises.
     Tenant shall also provide Landlord with a written statement, at Tenant’s sole expense, from a reputable company licensed and experienced in HVAC repair and maintenance approved by Landlord that certifies that the HVAC equipment serving the Premises was inspected and serviced, if necessary, within the last thirty (30) days of the Term and is in good working order. If Tenant fails to provide the statement, Landlord may order an inspection of the HVAC at Tenant’s expense.
ARTICLE XVI
INSURANCE AND INDEMNITY
      Section 16.01. Tenant’s Liability and Property Insurance.
     During the Term, Tenant, at its expense, shall keep in full force and effect a policy of commercial general liability insurance insuring Landlord and Tenant from and against all claims, demands, actions or liability for injury to or death of any persons, and for damage to property arising from or related to the use or occupancy of the Premises or the operation of Tenant’s business and the business operated by Tenant and subtenants and concessionaires of Tenant in the Premises. No deductible will be carried under this coverage without the prior written consent of Landlord. The policy shall include coverage for property damage, bodily injury, premises/operations, contractual liability (including Tenant’s indemnity under this Lease), independent contractors, personal injury, product/completed operations, owned and nonowned automobiles, and, if applicable, liquor liability insurance. If required by Landlord, Tenant must carry building ordinance coverage. The insurance shall be written on an occurrence basis with coverage in a minimum amount of $1,000,000.00 per occurrence for bodily injury/property damage and $2,000,000.00 general aggregate limit. Tenant shall also maintain in full force and effect insurance covering all trade fixtures, merchandise, personal property and equipment in amounts no less than one hundred percent (100%) of the replacement value thereof, providing protection against any peril included within the classification of the “Fire and Extended Coverage”, including sprinkler damage, vandalism and malicious mischief. Tenant shall also maintain Worker’s Compensation Insurance with a limit no less than the amount required by law.
     During any construction on the Premises, Tenant shall cause its contractor to obtain a policy of general liability insurance in the same form as required of Tenant, a policy of builder’s risk insurance providing coverage for the expected value of Tenant’s Work when completed and Worker’s Compensation as required by law.
     All policies shall name the Landlord, the property manager, Landlord’s lender and any person, firms or corporations designated by Landlord as additional insures. No additional insured shall be liable for any payment for premiums. All additional insures shall be entitled to recovery for any loss occasioned to them, their servants, agents or employees by reason of negligence of Tenant, its officers, agents or employees. All policies shall contain a clause that the insurer will not cancel or change such coverage without first giving Landlord thirty (30) days prior written notice. All insurance shall be issued by an insurance company qualified to do business in the State in which the Entire Premises is located and having an overall rating of Class A- or better and a financial rating of Class V as rated in the most current available Best’s Key Rating Guide. Copies of all policies or certificates of insurance required hereunder shall be delivered to Landlord as a condition to Tenant’s entry onto the Premises. All policies shall be written as primary policies, not contributing with and not in excess of coverage which Landlord may carry. Landlord may increase the limits of liability required hereunder in the exercise of Landlord’s reasonable judgment.
     If this Lease is canceled by reason of damage or destruction and Tenant is relieved of its obligation to rebuild, any insurance proceeds for damages to the Premises, including all leasehold improvements, but excluding all fixtures, will belong to Landlord, free and clear of any claims by Tenant.
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      Section 16.02 Landlord’s Acquisition of Insurance.
     If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord.
      Section 16.03. Landlord Carried Insurance.
     Landlord shall, subject to reimbursement as provided herein, maintain public liability, fire with extended coverage insurance with a vandalism and malicious mischief endorsement, rental loss insurance, earthquake (if not otherwise economically impracticable) or any other insurance coverage deemed necessary by Landlord or Landlord’s lender (collectively, “Landlord Carried Insurance”) through the Term, in amounts from time to time deemed reasonably necessary by Landlord or Landlord’s lender on the Common Area. The Landlord Carried Insurance may be obtained through a blanket policy or other form of pooled insurance coverage covering not only the Entire Premises, but other property owned by Landlord or its affiliates. The fire and extended coverage insurance shall be in an amount equal to at least ninety percent (90%) of the replacement value of the Building and Improvements. During the Term, Tenant hereby agrees to reimburse Landlord as part of the Common Area Expenses for Tenant’s pro rata share of any Landlord Carried Insurance attributable to the Common Area and to reimburse Landlord for Landlord Carried Insurance attributable to the Tenant’s Building and Improvements. In determining Tenant’s share of the premiums for Landlord Carried Insurance, the schedule issued by the organization making the insurance rate on the improvements, areas and/or risks covered, showing the various components of such rates, shall be conclusive evidence of the charges which make up the insurance rate and the share to be charged to the Premises. If such a schedule cannot be obtained, then Tenant’s share shall be a proportion of the premiums for such Landlord Carried Insurance based on the ratio of the square footage of the floor area of the Premises to the total square footage of the floor area of all building space covered by such Landlord Carried Insurance.
      Section 16.04. Indemnification of Landlord.
     Tenant shall indemnify, defend, protect and save Landlord harmless from and against any and all claims, demands, actions, damages, liability and expense (including reasonable attorneys’ fees and costs of investigation) in connection with any damage to person and/or property arising directly or indirectly from or connected with the conduct or management of the business conducted by Tenant on the Premises, or the occupancy or use by Tenant of the Premises or any part of the Entire Premises, or from any breach or default on the part of Tenant in the performance of any covenant or agreement on the part of Tenant to be performed pursuant to this Lease, or from violations of or noncompliance with any governmental requirements or insurance requirements, or from any acts or omissions of Tenant or any person on the Premises by license or invitations of Tenant or occupying the Premises or any part thereof under Tenant whether such damage occurs in, on or about the Premises, the Common Area or the Entire Premises. In case Landlord shall be made a party to any litigation commenced by or against Tenant, Tenant shall accept any tender of defense by Landlord and shall, notwithstanding any allegations of negligence or misconduct on the part of Landlord, its agents or employees, defend, protect and hold Landlord harmless and pay all costs, expenses and reasonable attorneys’ fees incurred or paid by Landlord in connection with such litigation; provided, however, Tenant shall not be liable for any such damage to the extent and in the proportion such damage is ultimately determined to be attributable to the gross negligence or willful misconduct of Landlord, its agents or employees, unless covered by insurance required to be carried by Tenant. Landlord may, at its option, require Tenant to assume Landlord’s defense in any action covered by this Section 16.03 through counsel satisfactory to Landlord.
     Landlord shall, during the Term hereof, indemnify Tenant and save it harmless from and against any and all claims, demands, actions, damages, liability and expense arising solely out of the gross negligence or willful misconduct of the Landlord; providing, however, in no event shall Landlord be liable to Tenant for any consequential damages, including, without limitation, any claimed loss of profit or business.
      Section 16.05. Boiler, HVAC and Evaporative Cooler Insurance.
     If required by Landlord, Tenant, at its sole expense, shall procure and maintain in full force and effect for the Term, boiler and machinery insurance on all air-conditioning equipment, evaporative coolers, boilers, and other pressure vessels and systems, whether fired or unfired, located in the Premises. If said objects and the damage that may be caused by them or result from them are not covered by Tenant’s extended coverage insurance required pursuant to Section 16.01, then such boiler insurance shall be in an amount satisfactory to Landlord and equal to one hundred percent (100%) of the replacement value of such equipment.
      Section 16.06. Waiver of Subrogation.
     Landlord and Tenant hereby mutually waive their respective rights of recovery against each other for any loss to the Premises or its contents resulting from actions on or with respect to the Premises insured by fire, extended coverage or any other insurance existing for the benefit of the respective parties and each party agrees to apply to their insurers to obtain similar waivers from such insurers. Each party shall obtain any special endorsements required by such party’s insurer to evidence compliance with the aforementioned waiver.
      Section 16.07. Waiver or Loss and Damage.
     Landlord shall not be liable for any damage to property of Tenant, or of others, located in, on or about the Premises, nor for the loss of or damage to any property of Tenant or of others by theft or otherwise. Landlord shall not be liable to Tenant, Tenant’s employees or representatives for any injury or damage to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, rain or leaks from any part of the
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Premises or from the pipes, appliances or plumbing works or from the roof, street or sub-surface or from any other places or by dampness or by any other cause of whatsoever nature. Landlord shall not be liable to Tenant, Tenant’s employees or representatives for any such damage caused by other tenants or persons in the Premises, occupants of adjacent property of the Entire Premises, or the public, or caused by operations in construction of any private, public or quasi-public work. Landlord shall not be liable for any latent defects in the Premises or in the Building except for a period of one (1) year from the date of original completion of the Building by Landlord’s contractor. All property of Tenant kept or stored on the Premises shall be so kept or stored at the sole risk of Tenant and Tenant shall hold Landlord harmless from any claims arising out of damage to the same, including subrogation claims by Tenant’s insurance carriers, unless such damage shall be caused by the willful act or gross negligence of Landlord. Landlord shall not be liable in any circumstances for any consequential damages of any kind or nature whatsoever, including, without limitation, any claimed loss of profit or business.
      Section 16.08. Notice by Tenant.
     Tenant shall give immediate notice to Landlord in case of fire or accidents in the Premises or in the Building or of any damage or defects in the Premises, the Building or any fixtures or equipment therein.
ARTICLE XVII
ESTOPPEL CERTIFICATE, ATTORNMENT, SUBORDINATION,
MORTGAGEE PROTECTION CLAUSE
      Section 17.01. Estoppel Certificate.
     Within five (5) days after Landlord’s written request, Tenant agrees to deliver in recordable form a certificate to any proposed mortgagee, ground lessor or purchaser, or to Landlord, certifying that this Lease is in full force and effect, that there does not exist nor has there existed any toxic materials or hazardous waste in, on or about the Premises, that no more than one (1) month’s rent has been paid in advance, the essential terms of the Lease, that there are no defenses or offsets thereto, or stating those claimed by Tenant, and any other information that may be requested.
      Section 17.02. Attornment.
     Tenant shall, in the event any proceedings are brought for the foreclosure of, or in the event of exercise of the power of sale under any mortgage made by the Landlord covering the Premises, or in the event of a termination of any ground lease covering the Building or Premises, attorn to the purchaser or ground lessor upon any such foreclosure or sale or termination of ground lease and recognize such purchaser or ground lessor as the Landlord under this Lease, provided that any purchaser or mortgagee or ground lessor shall recognize this Lease as remaining in full force and effect so long as Tenant is not in default hereunder.
      Section 17.03. Subordination.
     Upon the written request of Landlord, and provided such mortgagee or ground lessor confirms in writing the nondisturbance provisions of Section 17.02 above, Tenant will immediately subordinate its rights hereunder to the lien of any mortgage or mortgages or the lien resulting from any other method of financing or refinancing, or any ground lease now or hereafter in force covering the land and the Building or upon any buildings hereafter placed upon the land of which the Premises are a part, and to all advances made or hereunder to be made upon the security thereof. This Section 17.03 shall be self-operative and no further instrument or subordination shall be required unless requested by Landlord’s mortgagee or ground lessor. Tenant covenants and agrees that it will execute subordination agreements at any time upon Landlord’s written request without compensation being made therefor. However, if Landlord so elects, this Lease shall be deemed prior in lien to any mortgage, deed of trust or other encumbrances or ground lease upon or including the Premises, regardless of recording and Tenant will execute a statement in writing to such effect at Landlord’s request.
      Section 17.04. Mortgagee Protection Clause.
     Tenant agrees to give any mortgagees, trust deed holders and/or ground lessor, by registered mail, a copy of any notice of default served upon the Landlord, provided that prior to such notice Tenant has been notified in writing (by way of notice of assignment of lease, or otherwise) of the addresses of such mortgagees, trust deed holders and/or ground lessor. Tenant further agrees that if Landlord shall have failed to cure such default within the time provided for in this Lease, then the mortgagees and/or trust deed holders shall have an additional thirty (30) days within which to cure such default, or if such default cannot be cured within that time, then such additional time as may be necessary, provided such mortgagees, trust deed holders and/or ground lessor commence such cure within thirty (30) days and diligently pursue the remedies necessary to cure such default (including but not limited to commencement of foreclosure proceedings to effect such cure), in which event this Lease shall not be terminated while such remedies are being so diligently pursued.
      Section 17.05. Landlord Waiver Form.
     Upon request by Tenant, Landlord shall execute an Landlord’s waiver and consent to financing for Tenant’s fixturization on the Premises in a form to be supplied by Landlord. Tenant shall pay Landlord $150.00 (increased by the Index) for each form signed by Landlord.
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ARTICLE XVIII
ASSIGNMENT AND SUBLETTING
      Section 18.01. Consent Required.
     Except as provided in Sections 18.02, 18.03 and 18.04 herein, Tenant shall not assign this Lease in whole or in part, nor sublet all or any part of the Premises, without the prior written consent of Landlord, which consent shall not be unreasonably withheld. It is agreed that Landlord will not be acting unreasonably in refusing to consent to an assignment or sublease if, in Landlord’s reasonable business judgment, the quality of the merchandising operation of the proposed assignee or subtenant is not equal to that of the Tenant, the use of the Premises will change, such assignee or subtenant may adversely affect the business of other tenants or the tenant mix in the Entire Premises or Landlord’s ability to obtain percentage rent, the net worth of such assignee or subtenant is less than that of Tenant at time of execution of this Lease, or the proposed assignee or subtenant lacks sufficient working capital to operate the business. The consent by Landlord to any assignment or subletting shall not constitute a waiver of the necessity for such consent to any subsequent assignment or subletting. If this Lease is assigned by Tenant, or if the Premises or any part thereof are sublet or occupied by any person or entity other than Tenant, Landlord may collect Rent from the assignee, subtenant or occupant, and apply the net amount collected to the Rent herein reserved, not no such assignment, subletting, occupancy or collection shall be deemed a waiver on the part of Landlord, or the acceptance of the assignee, subtenant or occupant as tenant, or a release of Tenant from the further performance by Tenant of covenants on the part of Tenant herein contained. Irrespective of any assignment or sublease, Tenant shall remain fully liable under this Lease and shall not be released from performing any of the terms, covenants and conditions of this Lease. If Tenant assigns this Lease or sublets the Premises, any rent paid to Tenant in addition to the Rent payable to Landlord as set forth in this Lease shall be paid be paid by Tenant to Landlord as additional rent.
     If Tenant is a corporation, an unincorporated association or a partnership, the transfer, assignment or hypothecation of any stock or interest in such corporation, association or partnership in the aggregate in excess of forty-nine percent (49%) shall be deemed an assignment within the meaning and provisions of this Section 18.01.
     Tenant shall pay Landlord a non-refundable processing fee of $50.00 (increased each year by the Index) for each requested assignment or sublease to cover Landlord’s costs. This fee shall accompany any request for assignment or sublease. In addition, Tenant shall pay all costs incurred by Landlord in connection with reviewing a request to consent to an assignment or sublease, including all of Landlord’s attorneys’ and accountants’ fees.
      Section 18.02. Permitted Assignment or Subletting by Franchisor.
     If Tenant is a franchisor, Tenant may assign its interest herein or sublet all or part of the Premises once to a bona fide franchisee or licensee of Tenant without the payment of the fee described in Section 18.01 (but subject to all other conditions contained therein), provided there shall be no change in the use of the Premises, provided Tenant notifies Landlord in writing thirty (30) days prior to such subletting or assignment and provided further such assignee or subtenant meets all of Tenant’s then nationwide franchise requirements including payment of the applicable standard franchise fee. Any subsequent subletting or assignment shall be subject to all the conditions of Section 18.01, including the payment of the fee.
      Section 18.03. Concessionaires.
     Tenant may grant concessions for the operation of one or more departments of the business which Tenant operates on the Premises as required by Section 10.01; provided however that (a) each such concession may be allowed only upon receipt by Tenant of the prior written consent of the Landlord, which consent shall not be unreasonably withheld, and shall be subject to all the terms and provisions of this Lease; (b) the Gross Receipts, as defined in Section 4.04 hereof, from the operation of each such concession shall be deemed to be a part of the Gross Receipts of Tenant for the purpose of determining the Percentage Rent payable to Landlord; (c) all of the provisions hereof applying to the business of Tenant including the provisions concerning reports and audits shall apply to each such concession; and (d) at least seventy-five percent (75%) of the sales floor area of the Premises shall at all times be devoted solely to the business operated by Tenant.
      Section 18.04. Involuntary Assignment.
     No interest of Tenant in this Lease shall be assignable by operation of law (including, without limitation, the transfer of this Lease by testacy or intestacy). Each of the following acts shall be considered an involuntary assignment: (a) if Tenant is or becomes bankrupt or insolvent, makes an assignment for the benefit of creditors, or institutes a proceeding under the Bankruptcy Act in which Tenant is bankrupt; or, if Tenant is a partnership or consists of more than one person or entity, if any partner of the partnership or other person or entity is or becomes bankrupt or insolvent, or makes an assignment for the benefit of creditors; (b) if a writ of attachment or execution is levied on this Lease; or (c) if, in any proceeding or action to which Tenant is a party, a receiver is appointed with authority to take possession of the Premises. An involuntary assignment shall constitute a default by Tenant, and Landlord shall have the right to elect to terminate this Lease, in which case this Lease shall not be treated as an asset of Tenant.
ARTICLE XIX
ADVERTISING AND PROMOTION
      Section 19.01. Advertising of Tenant.
     With the exception of national or regional advertising, Tenant, at its sole expense, agrees to refer to the Entire Premises by the name provided in Section 1.02.1, if one is so provided, in designating the location of the
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Premises in all local newspapers or other advertising, stationery, other printed material and in all other references to location, and to include the address and identity of its business activity in the Premises in all advertisements made by Tenant for its operation at the Entire Premises.
ARTICLE XX
DESTRUCTION OF PREMISES
      Section 20.01. Total or Partial Destruction.
     If the Premises shall be damaged by fire, the elements or other casualty or cause whether or not insured against under the provisions of Section 16.01 and 16.03, Tenant at its own expense, shall cause such damage to be repaired and the Premises reconstructed and restored as soon as reasonably practical, and any Rent or other charges payable hereunder shall not be abated. Landlord shall make any insurance proceeds available to Tenant on a reasonable basis for that purpose. Tenant shall be responsible for the concurrent prompt repair and restoration of its furniture, fixtures and equipment in the Premises damaged by such event. In the event that fifty percent (50%) or more of the Premises are damaged or destroyed by fire, the elements or other cause or casualty, Landlord shall have the right, to be exercised by written notice delivered to Tenant within sixty (60) days from and after said occurrence, to elect not to require the Tenant to reconstruct and repair the Premises, and in such event this Lease and the tenancy hereby created shall cease as of the date of said damage. If Landlord elects to terminate this Lease in accordance with this Section 20.01, all insurance proceeds, except for insurance proceeds for Tenant’s fixtures, shall become the property of Landlord.
      Section 20.02. Waiver of Termination.
     Tenant hereby waives any statutory rights which it may have to terminate the Lease in the event of the partial or total destruction of the Premises, if being agreed that the provisions of this Article XX shall control.
ARTICLE XXI
EMINENT DOMAIN
      Section 21.01. Total Condemnation.
     If the whole of the Premises shall be acquired for any public or quasi-public use or purpose or taken by eminent domain, then the Term shall cease and terminate as of the date possession or title is given to such condemning authority in such proceeding and all rentals shall be paid up to that date.
      Section 21.02. Total Parking Area.
     If the entire portion of the Common Area used for parking in the Entire Premises (“Parking Area”) shall be acquired for any public or quasi-public use or purpose or taken by eminent domain, then the Term shall cease and terminate as of the date possession or title is given to such condemning authority in such proceeding unless Landlord shall provide other parking facilities substantially equal to the previously existing ratio between the Parking Area and the Premises within ninety (90) days from the date of such taking. In the event that Landlord shall provide such other parking facilities, then this Lease shall continue in full force and effect without abatement of Rent or other charges.
      Section 21.03. Partial Condemnation.
     If any part of the Premises shall be acquired or taken by eminent domain for any public or quasi-public use or purpose, and in the event that such partial taking or condemnation shall render the Premises, in Landlord’s discretion, unsuitable for the operation of Tenant’s business, then the Lease shall cease and terminate as of the date possession or title is given to such condemning authority is such proceeding. In the event of a partial taking or condemnation which is not extensive enough to render the Premises unsuitable for the operation of Tenant’s business, then Landlord shall promptly restore the Premises to the extent of the condemnation proceeds to a condition comparable to its condition at the time of such condemnation less the portion lost in the taking, and this Lease shall continue in full force and effect and the Minimum Rent shall be equitably reduced based on the percentage of floor area of the Premises lost in the taking.
      Section 21.04. Partial Condemnation of Parking Area.
     If any part of the Parking Area shall be acquired or condemned by eminent domain for any public or quasi-public use or purpose and if, as the result of such partial taking the ratio of square feet of Parking Area to square feet of the sales floor area of the Entire Premises is reduced to a ratio below that permitted by law, then the Lease shall cease and terminate from the date possession or title is given to such condemning authority in such proceeding, unless Landlord shall provide reasonable evidence of its ability to increase the parking ratio to a permitted ratio or Landlord can provide substitute parking either in or outside the Entire Premises, in which event this Lease shall be unaffected and remain in full force and effect as between the parties.
      Section 21.05. Allocation of Award.
     Except as provided below, in the event of any condemnation or taking as herein provided, whether whole or partial, Tenant shall not be entitled to any part of the award, as damages or otherwise, for such condemnation and Landlord is to receive the full amount of such award; Tenant expressly waives any right or claim to any part thereof, including the right or claim for the value of the unexpired portion of the Term or diminution in value of Tenant’s leasehold interest, or for the value of any option to extend the Term or renew this Lease. Tenant shall, however, have the right, provided such award shall not diminish Landlord’s award, to claim and recover from the condemning
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authority, but not from Landlord, such compensation as may be separately awarded or recoverable by Tenant in Tenant’s own right on account of any and all damages to Tenant’s business for Goodwill and loss of income by reason of the condemnation and for or on account of any cost or less to which Tenant might incur in removing Tenant’s merchandise, future, fixtures and equipment from the Premises.
ARTICLE XXII
DEFAULT
      Section 22.01. Tenant’s Default.
     The occurrence of any of the following shall constitute a default by Tenant: (a) failure to pay rent when due, if the failure continues for three (3) days after notice has been given to Tenant; (b) abandonment and/or vacation of the Premises; (c) failure to operate in the Premises for ten (10) consecutive days; (d) failure to perform any nonmonetary provision of this Lease if the failure to perform is not cured within thirty (30) days after notice has been given to Tenant; provided that if the nonmonetary default cannot reasonably be cured within thirty (30) days, Tenant shall not be default of this Lease if Tenant commences to cure the default within the thirty (30) day period and diligently and in good faith continues to cure the default; and (e) failure to timely deliver an estoppel certificate as required by Section 17.01.
     Notices given under this Section 22.01 shall not be deemed a forfeiture or a termination of this Lease unless Landlord so elects in the notice. Notices given under this Section 22.01 shall be in lieu of and not in addition to any statutory notice required by law.
      Section 22.02. Landlord’s Remedies.
     Landlord shall have the following remedies if Tenant commits a default. These remedies are not exclusive; they are cumulative in addition to any remedies now or later allowed by law.
     Landlord can continue this Lease in full force and effect after Tenant’s default and abandonment, and the Lease will continue in effect as long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all Landlord’s rights and remedies under the Lease, including the right to collect Rent when due. During the period Tenant is in default, Landlord can enter the Premises and relet them, or any part of them, to third parties for Tenant’s account. Tenant shall be liable immediately to Landlord for all costs Landlord incurs in reletting the Premises, including, without limitation, brokers’ commissions, expenses of remodeling the Premises required by the reletting, and like costs. Reletting can be for a period shorter or longer than the remaining Term of this Lease. Tenant shall pay to Landlord the Rent due under this Lease on the dates the Rent is due, less the rent Landlord receives from any reletting. No act allowed by this Section 22.02 shall terminate this Lease unless Landlord notifies Tenant that Landlord elects to terminate this Lease.
     If Landlord elects to relet the Premises as provided in this Section 22.02, Rent that Landlord receives from reletting shall be applied to the payment of: first, any indebtedness from Tenant to Landlord other than Rent due from Tenant; second, all costs, including maintenance, incurred by Landlord in reletting; and third, Rent due and unpaid under this Lease. After deducting the payments referred to in this Section, any sum remaining from the Rent Landlord receives from reletting shall be held by Landlord and applied in payment of future Rent as Rent becomes due under this Lease. In no event shall Tenant be entitled to any excess Rent received by Landlord. If, on the date Rent is due under this Lease, the Rent received from the reletting is less than the Rent due on that date, Tenant shall pay to Landlord, in addition to the remaining Rent due, all costs, including maintenance, Landlord incurred in reletting that remain after applying the Rent received from the reletting as provided in this Section 22.02.
     Landlord can terminate Tenant’s right to possession of the Premises at any time. No act by Landlord other than giving notice to Tenant shall terminate this Lease. Acts of maintenance, efforts to relet the Premises or the appointment of a receiver on Landlord’s initiative to protect Landlord’s interest under this Lease shall not constitute a termination of Tenant’s right to possession. On termination, Landlord has the right to recover from Tenant: (a) the worth, at the time of the award, of the unpaid rent that had been earned at the time of termination of this Lease; (b) the worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and (d) any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s default. “The worth, at the time of the award”, as used in (a) and (b) of this Section 22.02, is to be computed by allowing interest at the maximum rate an individual is permitted by law to charge. “The worth, at the time of the award,” as referred to in (c) of this Section 22.02, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
      Section 22.03. Appointment of Receiver.
     If Tenant is in default of this Lease, Landlord shall have the right to have a receiver appointed to collect Rent and conduct Tenant’s business. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this lease.
      Section 22.04. Landlord’s Right to Cure Tenant’s Default.
     Landlord, at any time after Tenant commits a default, can cure the default at Tenant’s cost. If Landlord at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord at the time the sum is paid, and if paid at a later date shall bear interest at the maximum rate an individual is permitted by law to charge from the date the sum is paid by Landlord until Landlord is reimbursed by Tenant. The sum, together with interest on it, shall be additional rent.
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      Section 22.05. Waiver of Rights of Redemption.
     Tenant expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being evicted or dispossessed for any cause, or in the event of Landlord obtaining possession of the Premises, by reason of the violation by Tenant of any of the covenants or conditions of this Lease, or otherwise.
      Section 22.06. Default by Landlord.
     If Landlord fails to perform any of the covenants or conditions required on its part to be performed pursuant to this Lease, where such failure continues for a period of thirty (30) days after receipt of written notice specifying the nature and extent of such default in detail (provided, however, that if such default is of a nature that it cannot reasonably be cured within thirty (30) day period). Landlord shall be liable to Tenant for all damages sustained as a direct result of such breach, subject to the additional rights of any mortgagees of Landlord as provided in Section 17.04 herein. Landlord’s liability shall be limited to Landlord’s interest in the Entire Premises. Neither Landlord nor any of its partners shall be personally liable.
ARTICLE XXIII
SUCCESSORS; SALE OF PREMISES
      Section 23.01. Successors and Assigns.
     Except as provided in Section 18.05, all rights and liabilities herein given to, or imposed upon, the respective parties hereto shall extend to and bind the several respective heirs, executors, administrators, successors, and assigns of said parties; and if there shall be more than one tenant, they shall all be bound jointly and severally by the terms, covenants and agreements herein. No rights, however, shall inure to the benefit of any assignee of Tenant unless the assignment to such assignee has been approved by Landlord in writing as provided in Section 18.01 hereof.
      Section 23.02. Sale of Premises.
     In the event Landlord shall sell, convey, transfer or exchange the Premises, the Entire Premises or the Building, Tenant agrees to recognize and attorn to the purchaser or transferee, as the Landlord hereunder and Landlord shall be and is hereby relieved and released from any liability under any and all of its covenants and obligations under the Lease arising out of any act, occurrence or event arising after such sale, conveyance, transfer or exchange.
ARTICLE XXIV
QUIET ENJOYMENT
      Section 24.01. Landlord’s Covenant.
     Upon timely payment by Tenant of the Rent, and upon the observance and performance of all of the covenants, terms and conditions on Tenant’s part to be observed and performed hereunder, Tenant shall peaceably and quietly hold and enjoy the Premises for the Term without unreasonable hindrance or interruption by Landlord or any other person or persons lawfully or equitably claiming by, through or under the Landlord, subject, nevertheless, to the terms and conditions of this Lease. Landlord may subject its interest in the Premises to a Lien or Mortgage provided, the lienholder furnishes Tenant with a Subordination, Attornment and Non-Disturbance Agreement.
ARTICLE XXV
MISCELLANEOUS
      Section 25.01. Index.
     Whenever in this Lease there is a reference to the Index, such reference shall refer to the following:
     (a) The “Index” as used in this Lease shall be deemed to mean The United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, U.S. City Average, Subgroup “All items”, (1982-84 = 100) (the “Index”). If at any time there shall not exist the Index in the format recited herein, Landlord shall substitute any official index published by the Bureau of Labor Statistics or successor or similar substitute any office index published by the Bureau of Labor Statistics, or successor or similar governmental agency, as may then be in existence and shall, in Landlord’s opinion, be most nearly equivalent thereto.
     (b) The sum to be increased in accordance with the provisions of the Index shall be increased using the following formula: Such sum shall be increased by a percentage equal to the percentage increase, if any, in the Index published for the Comparison Month over the Index published for the Base Month; provided, however, in no event shall said sum be less than that which was due immediately preceding the date of adjustment. If no Comparison Month or Base Month shall be specified, the Comparison Month shall be three (3) months prior to the anniversary of the Rent Commencement Date for the year of the increase, and the Base Month shall be three (3) months prior to the Rent Commencement Date.
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      Section 25.02. Waiver.
     No payment by Tenant or receipt by Landlord of a lesser amount than the Rent herein stipulated shall not be deemed to be a waiver of any other default, term, covenant or condition concerning the same. No delay or omission in the exercise of any right or remedy of Landlord shall impair such a right or remedy or be construed as a waiver. The subsequent acceptance of Rent hereunder by Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of any term, covenant or condition of this Lease, other than the failure of Tenant to pay the particular rental so accepted, regardless of Landlord’s knowledge of such preceding breach at the time of acceptance of such Rent.
      Section 25.03. Accord and Satisfaction.
     No payment by Tenant or receipt by Landlord of a lesser amount than the Rent herein stipulated shall be deemed to be other than on account of the earliest stipulated Rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as Rent be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord’s right to recover the balance of such Rent or pursue any other remedy in this Lease.
      Section 25.04. Entire Agreement.
     This Lease and the Exhibits attached hereto and forming a part hereof, set forth all the representations, covenants, promises, agreements, conditions and understandings between Landlord and Tenant concerning the Premises and there are no representations, covenants, promises, agreements, conditions or understandings, either oral or written, between them other than are herein set forth. Any subsequent alteration, amendment, change or addition to this Lease must be in writing, signed by Landlord and Tenant.
      Section 25.05. No Partnership.
     Landlord does not, in any way or for any purpose, become a partner of Tenant in the conduct of its business, or otherwise, or joint venture or a member of a joint enterprise with Tenant by reason of this Lease. The provisions of this Lease relating to the Percentage Rent payable hereunder are included solely for the purposes of providing a method whereby Rent is to be measured and ascertained.
      Section 25.06. Force Majeure.
     In the event that either party hereto shall be delayed or hindered in or prevented from the performance of any act required hereunder by reason of strikes, lock-outs, labor troubles, inability to procure materials, failure of power, governmental moratorium, riots, insurrection, war or other reason of a like nature not the fault of the party delaying in performing work or doing acts required under the terms of this Lease (but excluding delays due to financial inability), then performance of such act shall be excused for the period of such delay. The provisions of this Section 25.06 shall not operate or excuse Tenant from the prompt payment of Minimum Rent, Percentage Rent, additional rent or any other payments required by the terms of this Lease.
      Section 25.07. Holding Over.
     Any holding over after the expiration of the Term, with or without the consent of the Landlord, shall be construed to be a tenancy from month to month at a rent specified by Landlord in its sole discretion, which rent shall never be less than the then prevailing market rate for the Entire Premises (as determined solely by Landlord) and shall otherwise be on the terms and conditions herein specified, as far as applicable.
      Section 25.08. Notices.
     All notices hereunder must be served personally or by certified or registered mail, postage prepaid, addressed to Tenant and to Landlord at the address given below or at such other address as Landlord or Tenant may designate by written notice pursuant to this Section 25.08. Any notice given by mail shall be deemed given forty-eight (48) hours after deposit in the mail.
         
 
  Landlord:   Dyer Triangle LLC
 
      150 Pelican Way
 
      San Rafael, CA 94901
 
      Attn.: Real Estate Department
 
       
 
  Tenant:   Century Theatres, Inc.
 
      150 Pelican Way
 
      San Rafael, CA 94901
 
      Attn.: Legal Department
      Section 25.09. Captions and Section Numbers.
     The captions, section numbers, article numbers, and index appearing in this Lease are inserted only as a matter of convenience and in no way define, limit, construe, or describe the scope or intent of such sections or articles of this Lease nor in any way affect this Lease.
      Section 25.10. Tenant Defined, Use of Pronoun.
     The word “Tenant” means each and every person or party mentioned as a Tenant herein, be the same one or more; and if there shall be more than one Tenant, any notice required or permitted by the terms of this Lease may be given by or to any one thereof, and shall have the same force and effect as if given by or to all thereof. The
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persons signing as Tenant shall be jointly and severally liable. The use of the neuter singular pronoun to refer to Landlord or Tenant shall be deemed a proper reference even though Landlord or Tenant may be an individual, a partnership, a corporation, or a group of two or more individuals or corporations. The necessary grammatical changes required to make the provisions of this Lease apply in the plural sense where there is more than one Landlord or Tenant and to either corporations, associations, partnerships, or individuals, males or females, shall in all instances be assumed as though in each case fully expressed.
      Section 25.11. Partial Invalidity.
     If any term, covenant or condition of this Lease or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such term, covenant or condition to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and each term, covenant or condition of this Lease shall be valid and enforced to the fullest extent permitted by law.
      Section 25.12. No Option.
     The submission of this Lease for examination does not constitute a reservation of or option for the Premises and this Lease becomes effective as a Lease only upon execution and delivery thereof by Landlord to Tenant.
      Section 25.13. Recording.
     Tenant shall not record this Lease or a memorandum thereof.
      Section 25.14. Legal Expenses.
     In the event that any time during the Term either Landlord or Tenant shall institute any action or proceeding against the other relating to the provisions of this Lease, or any default hereunder, or engage an attorney to enforce such provision then, and in that event, the unsuccessful party in such action or proceeding agrees to reimburse the successful party for the actual expenses of attorneys’ fees and disbursements incurred therein by the successful party.
     The successful party in such suit shall be entitled to its costs of suit and actual attorneys’ fees whether or not such action is prosecuted to judgment. “Successful party” within the meaning of this Section 25.14 shall include, without limitation, a party who brings an action against the other or who defends against an action brought by the other and whose position is substantially upheld.
      Section 25.15. Rights Cumulative.
     The rights and remedies of Landlord specified in this Lease shall be cumulative and in addition to any other rights and remedies provided by law.
      Section 25.16. Authority.
     If Tenant is a corporation or partnership, each individual executing this Lease on behalf of such entity represents or warrants that he or she is duly authorized to execute and deliver this Lease on behalf of such entity and that such entity shall be bound by all the terms and provisions hereof.
      Section 25.17. Mortgage Changes.
     Tenant shall not unreasonably withhold its consent to changes or amendments to this Lease requested by the holder of any mortgage or deed of trust covering Landlord’s interest in the Premises so long as such changes do not materially alter the economic terms of this Lease or otherwise materially diminish the rights or materially increase the obligations of Tenant hereunder.
      Section 25.18. Time of the Essence.
     Time is of the essence in each and every provision of this Lease except for delivery of possession of the Premises as set forth herein.
          Executed as of the date first written above.
                 
    LANDLORD: DYER TRIANGLE LLC, A    
    CALIFORNIA LIMITED LIABILITY COMPANY    
 
               
    /s/ Raymond Syufy    
         
 
               
    Its:   Member — Manager    
 
               
    TENANT:   CENTURY THEATRES, INC.    
 
          DELAWARE CORPORATION    
 
               
    /s/ Joseph Syufy    
         
 
               
    Its:   President    
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EXHIBIT 10.25(b)
First Amendment to Lease
      This First Amendment to Lease (this “Amendment” ) dated April 15, 2005 is executed by and between Dyer Triangle LLC, a California limited liability company ( “Landlord” ), and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth :
      Whereas, Landlord and Century Threatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), entered into a lease dated April 10, 1998 (the “Lease” ) for a motion picture building and related parking (the “Premises” ) located at Union Landing Entertainment Center, Union City, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Right to Renovate
     1. In addition to Landlord’s rights under the Lease (including, without limitation, Landlord’s rights pursuant to Section 2.02 of the Lease), Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter in any manner the Entire Premises or any portion thereof (a “Renovation”) without Tenant’s consent; provided, however, that Landlord shall use commercially reasonable efforts to ensure that a Renovation does not materially impede Tenant’s reasonable access to and use of the Leased Premises.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, a Renovation. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Leased Premises resulting from or in connection with a Renovation, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with a Renovation (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
 
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     3. Within a reasonable period of time following receipt of Landlord’s written request (but in no event more than one hundred eighty (180) days), Tenant shall re-paint Tenant’s Building and any other buildings which are a part of the Leased Premises as Landlord deems necessary or desirable in its sole and absolute discretion and in connection with a Renovation.
B. Pavement Area
     1. From and after the date hereof, the “Premises” or “Leased Premises” described in Section 2.01 of the Lease shall include only Tenant’s Building, and shall not include the front entrance, paved entryway or lighting and landscaping contiguous to the Tenant’s Building (the “Pavement Area” ).
     2. Notwithstanding anything to the contrary herein or in the Lease, Tenant’s maintenance obligations set forth in Section 11.01 and Tenant’s indemnity obligations set forth in Section 10.01 of the Lease shall apply to the Pavement Area, and Tenant, at its sole cost and expense, shall keep the Pavement Area in first class order, condition and repair, and shall make all repairs necessary to keep the Pavement Area in such condition.
C. Insurance
     1. Notwithstanding anything to the contrary herein or in the Lease, Tenant’s insurance obligations under the Lease (including, without limitation, the obligations set forth in Sections 16.01 and 16.03 of the Lease) shall apply to the Pavement Area as well as the Premises.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Pavement Area. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property (including, without limitation, all “slip and fall” incidents) located in, on or about the Pavement Area, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Pavement Area (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
D. Landlord’s Right to Develop
1. Section 2.02 of the Lease, the following is hereby deleted in its entirety and replaced with the following:
In addition to Landlord’s other development rights contained in the Lease, Tenant expressly agrees that Landlord shall retain all rights to develop the rooftop area of the Building, including, without limitation, all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, sell, lease, license, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no
 
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right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
E. Surrender
     The third and fourth sentences of Section 14.02 are hereby deleted in their entirety and replaced with the following:
Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
F. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
 
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     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
 
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Dyer Triangle LLC,
      Century Theatres, Inc.,    
a California limited liability company
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
 
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EXHIBIT 10.25(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Dyer Triangle LLC, a California limited liability company (“Landlord”), and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth :
      Whereas , Landlord and Century Threatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), entered into a lease dated April 10, 1998, as amended by that certain First Amendment to Lease dated April 15, 2005 (the “ Lease ”) for a motion picture building and related parking (the “ Premises ”) located at Union Landing Entertainment Center, Union City, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this
 
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Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Dyer Triangle LLC,
      Century Theatres, Inc.,    
a California limited liability company
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy
 
Raymond Syufy,
     
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
 
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EXHIBIT 10.25(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(Union City, California)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 5, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between DYER TRIANGLE, LLC, a California limited liability company (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Dyer City Triangle LLC, a California limited liability company (“Original Landlord”) and Century Theatres, Inc., a Delaware corporation (“Original Tenant”), entered into a certain Lease dated as of April 10, 1998 (the “Original Lease”), for certain premises located in Union City, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of April 15, 2005 (the “First Amendment”) and (ii) Second Amendment to Lease dated as of September 29, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Amendment shall become void ab initio and of no force and effect.

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     3.  Site Plan . The Site Plan attached as Exhibit A to the Original Lease is hereby deleted and replaced by Exhibit A attached hereto and made a part hereof. All references in the Lease to the Site Plan shall mean and refer to Exhibit “A” attached hereto.
     4.  Extension of Term . The second sentence of Section 3.02 of the Original Lease shall be deemed deleted in its entirety and shall be of no further force or effect.
     5.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in Contra Costa and Alameda County typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     6.  Trade Name . Notwithstanding Sections 1.02.4 and 10.01 of the Original Lease, if Tenant shall change the trade name under which the majority of its motion picture theater complexes are operated, or if Tenant shall assign the Lease or sublet the Premises in accordance with Lease, then the Premises may be operated under the trade name used by Tenant or such assignee or subtenant (as the case may be) in the majority of the motion picture theatre complexes that it operates in the San Francisco/Bay area.
     7.  Hours of Operation . Notwithstanding anything contained in Section 10.02 of the Original Lease to the contrary, Tenant shall not be obligated to open or operate its business in the Premises on such days or at such times that a majority of other first-class motion picture theater complexes (whether owned by Tenant or others) in Contra Costa and Alameda County, California market area typically are not open and operating for business.
     8.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self

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insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
     9.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.

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     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     10.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XVIII of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 8 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     11.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30)

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days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l” .
     12.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     13.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar

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devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     14.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the seven (7) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
          (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
          (ii) Attributable to the annual inflationary increases in real estate taxes; or
          (iii) Attributable to the Acquisition on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the seven (7) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the seventh (7 th ) anniversary of the Effective Date of this Amendment.
     15.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely

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indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations, changes and improvements, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 5 of this Amendment. In addition, Tenant shall not move the main entrance of the theater without Landlord’s prior written consent, which consent may be withheld in Landlord’s sole and absolute discretion.
     16.  Conditions of Record . Notwithstanding anything contained in the Lease to the contrary (including, without limitation, Section 2.04 of the Original Lease), Tenant shall not be bound by any future documents of record, if and to the extent that the terms and provisions thereof would (i) conflict with Tenant’s express rights and privileges under the Lease or Landlord’s express duties and obligations under the Lease, or (ii) materially and adversely impact Tenant’s operation of the Premises as a motion picture theatre, or (iii) materially increase the cost to Tenant of operating its business at the Premises. In addition, Landlord covenants and agrees that any covenants or other restrictions of record hereafter recorded against the Entire Premises (or any portion thereof) and binding upon the Premises will be applied in a non-discriminatory manner to all tenants and occupants of the Entire Premises (subject to reasonable and customary distinctions for size and use of the affected premises).
     17.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements existing on the date hereof and any extensions

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thereof that may be exercised by the licensee or lessee thereunder regarding Rooftop Equipment. The lessees or licensees under such agreements may unilaterally extend or renew if and to the extent provided under such agreements, but Landlord may not renew or extend such agreements or extend such agreements unilaterally if such systems interfere with the transmission received by Tenant’s Rooftop Equipment installed pursuant to this Section.
     18.  Alterations and Development by Landlord . (i) Notwithstanding anything to the contrary set forth in the Lease (including, without limitation, Section 2.02 and Section 2.03), and except as substantially shown on the Site Plan attached hereto, Tenant’s prior written consent (which shall not be unreasonably withheld, delayed or conditioned) shall be required only with respect to any new buildings, improvements (but not maintenance or repairs), alterations or additions located or proposed to be located within the “Protected Area” (but not outside the Protected Area) of the Entire Premises (as shown on the Site Plan). Tenant shall not withhold its consent unless any such new buildings, improvements, alterations or additions would materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage) in a direct and demonstrable manner.
  (ii)   Landlord shall not lease, sell or use any space on the Entire Premises or contiguous property which permits the operation of a motion picture theater.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on the Entire Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food, a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”; a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre. In addition, Landlord shall not place any carts, kiosks, or other temporary structures selling any items within the No Kiosk Area as shown on the Site Plan.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     19.  Signage . Notwithstanding Section 14.04 of the Original Lease to the contrary, Tenant shall not be required to remove or pay for the removal of its signage (or the installation of new signage) as a consequence of Landlord’s revision of the Sign Criteria. The responsibilities of Tenant with respect to the maintenance, repair and replacement of Tenant’s

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signage shall be governed by Article XI of the Lease, subject to the restrictions and approval rights of Landlord under Article XIV of the Lease (as hereby amended). If new pylon and/or monument signs are constructed in the Entire Premises, as to any such signs on which Tenant has a sign panel, Tenant will pay Tenant’ s pro rata share (based on the relative size of Tenant’s sign panel to all of the sign panels on the applicable signs) of the costs to construct such signs. In the event any such new signs are constructed, Tenant shall have the right, but not the obligation, to place its sign panel at the top sign panel position on such signs. Tenant must elect to install such panels within thirty (30) days after Landlord notifies Tenant that the sign structure is available for sign panels, and if Tenant so elects, Tenant shall promptly thereafter install Tenant’s sign panel(s).
     20.  Competition/Radius Restriction . The radius restriction in Section 10.03 of the Original Lease shall not apply to any motion picture theatre complex which is developed, open and operating for business prior to Tenant or any affiliate of Tenant acquiring (or agreeing to acquire) any interest therein (as owner, lessee, operator, manager or otherwise).
     21.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal. Notwithstanding anything in this Lease to the contrary, in no event shall Tenant be obligated to remove and/or demolish the theater building (except as required by Section 9(B) above).
     22.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
     Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.

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     23.  Termination of Lease and Lessee’s Right to Possession . The fourth (4th) sentence of the fourth (4th) paragraph of Section 22.02 of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     24.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant

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hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Dyer Triangle, LLC
 
      c/o SyWest Development
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: William Vierra
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 100
Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     25.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     26.  Prior Amendments . The First Amendment and the Second Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this

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Amendment shall replace and restate such First Amendment and Second Amendment in their entirety.
     27.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
     28.  Passes . On the condition that Syufy Enterprises, LP is affiliated with Landlord, Tenant shall provide Landlord with *** each good for admission by bearer, plus a guest each year. The passes shall carry no surcharge or fee and shall not otherwise impose restrictions beyond those required by the film distribution companies. The passes shall provide admission to any of Tenant’s and Tenant’s affiliates’ theaters in the United States.
     29.  Premises . Notwithstanding the provisions with Section 2.01 of the Lease, the “Premises” or “Leased Premises” shall mean Tenant’s theatre building as constructed as of the date of this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
DYER TRIANGLE LLC., a California limited COMPANY
             
By:   Syufy Enterprises, LP, a California limited partnership    
Its:   Co Owner    
 
           
 
  By:   Syufy Properties, Inc., a California corporation    
 
  Its:   General Partner    
 
           
 
  By:   /s/ William Vierra    
 
           
 
      William Vierra    
 
  Its:   Senior Vice President    
 
           
By:   Sycal Properties, Inc., a California corporation    
Its:   Co-Owner    
 
           
 
  By:   Syufy Properties, Inc., a California corporation    
 
  Its:   Sole and Managing Member    
 
           
 
  By:   /s/ William Vierra    
 
           
 
      William Vierra    
 
  Its:   Senior Vice President    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ David Shesgreen    
 
           
 
  Name:   DAVID SHESGREEN    
 
  Title:   PRESIDENT & CEO    

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EXHIBIT 10.26(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE SPARKS, NEVADA
Table of Contents
         
    Page No.  
RECITALS
    1  
 
       
ARTICLE I EXHIBITS — DEFINITIONS
    1  
 
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II PREMISES — TERM — OPTIONS — COVENANT OF TITLE
    2  
 
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title
    3  
 
       
ARTICLE III USE OF PREMISES
    4  
 
       
3.01 Use
    4  
 
       
ARTICLE IV RENT
    4  
 
       
4.01 Annual Fixed Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V TAXES, ASSESSMENTS AND UTILITIES
    6  
 
       
5.01 Impositions
    6  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.03 Contest of Taxes
    6  
5.04 Utilities
    7  
5.05 Personal Property Taxes
    7  

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LEASE SPARKS, NEVADA
Table of Contents
         
    Page No.  
 
   
ARTICLE VI INSURANCE
    7  
 
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Fund Held in Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII MAINTENANCE, REPAIRS AND ALTERATIONS
    10  
 
       
7.01 Alterations — Changes
    10  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII ENVIRONMENTAL MATTERS
    10  
 
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    11  
8.03 Remedial Work
    12  
8.04 Maintenance of Premises
    13  
8.05 Landlord’s Responsibilities
    13  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    14  
 
   
ARTICLE IX IMPROVEMENTS
    14  
 
       
9.01 Tenant Improvements
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    15  
9.04 Ownership of Improvements
    15  

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LEASE SPARKS, NEVADA
Table of Contents
         
    Page No.  
9.05 Control
    15  
 
       
ARTICLE X INDEMNITY
    15  
 
       
10.01 Landlord’s Indemnity
    15  
10.02 Tenant’s Indemnity
    16  
 
       
ARTICLE XI ASSIGNMENT AND SUBLETTING
    16  
 
       
11.01 Assignment and Subletting
    16  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII MORTGAGE SUBORDINATION
    16  
 
       
12.01 Existing Mortgages
    16  
12.02 Future Mortgages
    16  
 
       
ARTICLE XIII CONDEMNATION — EMINENT DOMAIN
    17  
 
       
13.01 Definitions
    17  
13.02 Notice to Other Party
    17  
13.03 Total Taking — Effect on Rent and Term
    18  
13.04 Distribution of Award for Taking
    18  
13.05 Partial Taking — Rent Adjustments
    18  
13.06 Partial Taking — Option to Terminate
    18  
13.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XIV DEFAULT
    18  
 
       
14.01 Tenant’s Default
    18  
14.02 Landlord’s Remedies Cumulative
    19  
14.03 Landlord’s Default
    20  
14.04 Waiver of Redemption
    21  
14.05 Dispute Resolution
    21  

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LEASE SPARKS, NEVADA
Table of Contents
         
    Page No.  
14.06 Attorneys’ Fees
    21  
 
       
ARTICLE XV REPRESENTATIONS AND WARRANTIES
    21  
 
       
15.01 Landlord’s Representations and Warranties
    21  
15.02 Tenant’s Representations and Warranties
    22  
 
   
ARTICLE XVI DAMAGE OR DESTRUCTION
    22  
 
       
16.01 Repairs, Alterations and Further Improvements
    22  
16.02 Prompt Repair
    23  
16.03 Rent Adjustment
    23  
16.04 Damage During Last Two (2) Years of Term
    23  
 
       
ARTICLE XVII MISCELLANEOUS
    23  
 
       
17.01 Limitation on Liability
    23  
17.02 Brokers
    23  
17.03 Modification
    24  
17.04 Severability
    24  
17.05 Governing Law
    24  
17.06 Terminology
    24  
17.07 Counterparts
    24  
17.08 Binding Effect
    24  
17.09 Captions
    24  
17.10 Notices to Landlord and Tenant
    24  
17.11 Addresses for Notices to Landlord and Tenant
    25  
17.12 Entire Agreement
    25  
17.13 Sale or Transfer of Premises
    25  
17.14 Force Majeure
    26  
17.15 Waiver
    26  
17.16 Estoppel Certificate
    26  

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LEASE SPARKS, NEVADA
Table of Contents
         
    Page No.  
17.17 Number and Gender
    26  
17.18 No Holding Over
    26  
17.19 Mechanics Liens
    26  
17.20 Relationship of Parties
    27  
17.21 Time of the Essence
    27  
17.22 Facsimile Copies
    27  
17.23 Anti-Merger
    27  
 
       
SIGNATURE PAGE
    28  
 
       
Exhibit A  A Description of Leased Premises
       
Exhibit B   Form of Memorandum of Lease
       

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LEASE — SPARKS, NEVADA
     THIS INDENTURE OF LEASE, dated and effective as of March 7, 1997, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, CA, hereinafter called “Landlord”, and CENTURY THEATRES, INC., a Delaware corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in a parcel of land described on Exhibit A attached hereto.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the land.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the tract of land hereinafter referred to as “Premises” or “Leased Premises”.
               EXHIBIT B — Form of Memorandum of Lease
      1.02 Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” and “Rent Commencement Date” shall mean the date which is the earlier of (i) fifteen months after Tenant has secured a building permit for construction of Tenant’s building or (ii) the date on which Tenant opens for business in the Premises.
               The term “Default Rate” shall mean the Ten percent (10%).
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” or “Premises” shall mean the tract of land described on Exhibit A.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Leased Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
     
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     The term “Option Periods” shall mean ***       successive separate periods of ***      each and *** successive period of ***
     The term “Percentage Rate” shall mean ***
     The term “Planned Use” shall mean the construction and operation of a 57,784 square foot multi-plex motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
     The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
     The term “CC&R’s” shall mean the “Declaration of Covenants, Conditions, Restrictions and Easements for Victorian Square” recorded in the City of Sparks on March 4, 1997.
     The term “Tenant’s Building” shall mean the building to be erected by Tenant.
     The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
      2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date.
          D) Tenant shall be a party to and subject and subordinate to the Declarations of Covenants, Conditions, Restrictions and Easements for Victorian Square. Tenant shall have all rights related to the use of the Common Areas as set forth in the CC&R’s and Tenant shall be obligated to pay its hare of all costs and expenses, including property taxes, related to the Common Area as set forth in the CC&R’s.
      2.02 Term of Lease.
     
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               Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter and shall terminate on the last day of the calendar month during which the date which is ***      after the Commencement Date occurs. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
      2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***      consecutive additional periods of ***      each and ***      additional period of ***      (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default (meaning the breach of any obligation hereunder and failure to cure that breach within the time permitted in Section 14.01) at time of the exercise of the renewal and at the commencement of the renewal term.
      2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Leased Premises in fee simple.
               (B) At all times during the Term, Tenant shall keep and maintain the Leased Premises and Tenant’s Building in good order and repair and in a clean and safe condition, reasonably free of debris. Tenant shall make any and all additions to and all alterations and repairs in, on and about the Leased Premises, which may be required by, and shall otherwise observe and comply with, all public laws, ordinances
     
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and regulations from time to time applicable to the Leased Premises. Tenant shall indemnify and save harmless Landlord from and against all actions, claims and damages by reason of Tenant’s failure to comply with and perform its obligations under this section.
               (C) Tenant will not permit the Leased Premises to become subject to any mechanics’, laborers’ or materialmen’s lien on account of labor or material furnished to Tenant or claimed to have been furnished to Tenant in connection with work of any character performed or claimed to have been performed on the Leased Premises by or at the direction or sufferance of Tenant; provided, however, Tenant shall have the right to contest in good faith and with reasonable diligence the validity of any such lien or claimed lien and on final determination of the lien or claim for the lien, Tenant will immediately pay any judgment rendered with all proper costs and charges, and will, at its own expense, have the lien released and any judgment satisfied.
ARTICLE III
USE OF PREMISES
      3.01 Use.
          A) The Premises may be used for the Planned Use no other purpose. Tenant’s use shall be subject to the CC&R’s.
          B) Landlord shall agree and consent to such utility and other easements encumbering the Premises or benefiting the Premises as Tenant may reasonably require for its use and occupancy of the Premises.
          C) Tenant shall have the right to use the easements for parking, ingress and egress as set forth in the CC&R’s.
ARTICLE IV
RENT
      4.01 Annual Fixed Rent.
          A) Beginning on the Rent Commencement Date, Tenant shall pay to Landlord during the Lease Term Annual Fixed Rent in the amount of *** The Annual Fixed Rent shall be payable in advance in twelve (12) equal monthly installments. The Annual Fixed Rent shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 (B) below.
          B) The Annual Fixed Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Annual Fixed Rent shall be increased on the first day of the ***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by an amount of ***      greater than the Annual Fixed Rent payable immediately before the Adjustment date in question.
      4.02 Percentage Rent.
          In addition to the payment of Annual Fixed Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      ***      of the Gross Sales for such Lease Year exceeds the Annual Fixed Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross
     
August 22, 1997   SPARKS

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sales and the annual fixed rate percentage for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Annual Fixed Rate and Gross Sales for the first Lease Year.
          Gross Sales shall mean all box office receipts, and receipts from sales of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant and returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions”. Commissions paid to agencies or other third parties for selling tickets and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar officer of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of eighteen (18%) percent from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof.
      4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
      4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
      4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of ten (10%) per annum computed from the date such rent installment was due until the date actually paid.
      4.06 Additional rent. Tenant shall pay as additional rent its pro-rata share of all Common Area Expenses including Property Taxes and Insurance in accordance with the CC&R’s.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
      5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Leased Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not
     
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any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay when due all impositions assessed, levied or attributable to the Leased Premises and/or the Improvements on the Leased Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
          B) In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
      5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
      5.03 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.03. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.03.
      5.04 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities consumed on the Leased Premises. Any utility improvements
     
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presently serving the Leased Premises shall be maintained, repaired and replaced by Tenant, at Tenant’s expense.
      5.05 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
      6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
      6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Leased Premises, Premises and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) as well as any and all improvements on the Leased Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) including Builder’s Risk and earthquake to the extent of not less than 100% of the full replacement cost thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Upon written request, Tenant shall name Landlord and any parties requested by Landlord and the holder of the first mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Tenant in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
      6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
     
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          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
      6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
      6.05 Insurance Money and Other Funds Held in Trust. All insurance money or proceeds received by the Tenant and/or Landlord shall be held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and Second, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
      6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVI hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Tenant and Landlord shall apply the proceeds of the insurance collected to the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Tenant and Landlord by the licensed architect or engineer in charge of the work. Any amounts payable to Tenant or any Affiliate of Tenant for work or services performed or materials provided as part of any such repair, replacement, restoration or rebuilding shall not exceed competitive rates for such services or materials and Tenant shall, upon request of Landlord, make available to Landlord and its representatives all books and records of Tenant relating to such work, services and materials. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Tenant or Landlord with respect to the damage or destruction involved, and not used, shall be and remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Tenant and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
     
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               (2) Second, any remainder shall be paid to Landlord.
      6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any Insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
      6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unleasable or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
      7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with the CC&R’s as well as all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained, which approval shall not be unreasonably withheld.
          B) Tenant shall at all times keep the Leased Premises, Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
     
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          (C) Upon termination of this Lease, Tenant may, at its option, remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
      7.02 Repairs — Maintenance.
          Tenant shall, at its sole cost and expense, maintain and repair the Leased Premises and Tenant’s Building and all improvements on the Leased Premises including all exterior lighting and signs.
          Tenant shall commence all of the repairs and maintenance within 3 days after receiving notice thereof from Landlord (provided that in the case of an emergency Tenant shall commence such work immediately upon receiving notice) and shall be diligently completed in a good and workmanlike manner. Notwithstanding the foregoing, Landlord shall have the right and option (but not the obligation) to undertake any such repair, maintenance or other items, in which event Tenant shall reimburse Landlord for all of the costs thereof within 30 days after Landlord’s request therefor. If Tenant fails to reimburse Landlord within the 30 day period, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum until such payment has been made.
ARTICLE VIII
ENVIRONMENTAL MATTERS
      8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; all as amended, or any State of Nevada or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
      8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Leased Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Leased Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Leased Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or
     
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about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     
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      8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any cleanup, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
      8.04 Maintenance of Premises.
          A) Tenant at its sole cost and expense shall keep and maintain the Leased Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Leased Premises.
      8.05 Landlord’s Responsibilities.
     
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          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Leased Premises or any other portion of the Premises by Landlord, its agents, employees, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Leased Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials.
      8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
      8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
      9.01 Tenant Improvements.
          (A) Tenant at its sole cost and expense shall complete all the required on-site and off-site improvements, including all signs, required for the development of the Leased Premises. In addition Tenant shall construct a motion picture theater building on the Premises containing approximately fifty-seven thousand five hundred thirty-eight (57,538) square feet with fourteen auditoriums.
          (B) Landlord agrees to provide Tenant with an improvement allowance of up to a maximum of Four Million Eight Hundred Ninety Thousand Seven Hundred Thirty Dollars ($4,890,730) $85 per square foot-(Tenant Allowance). Tenant shall pay any difference between the total Tenant Building and improvement cost less the Tenant Allowance. Landlord agrees that it shall pay to Tenant, or at Tenant’s direction, to Tenant’s contractor, within fifteen (15) days following Landlord’s receipt of conditional lien waivers
     
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signed by its contractor, in form reasonably sufficient to waive lien rights in Washoe County, Nevada, an amount equal to the Tenant Allowance multiplied by the percentage of work completed as of the date of the lien waivers, less any installments of Tenant Allowance already paid. If the total contract for Tenant’s Work exceeds Tenant’s Allowance, Landlord shall only be required to pay its pro-rata share which shall be the ratio of Tenant’s Allowance to the total of Tenant’s Work. If Landlord disputes any portion of the request for payment by Tenant due to faulty or incomplete work, then Landlord shall withhold a sum which, in Landlord’s opinion would be required to correct or complete the disputed work. In this event, Landlord shall submit a written “punch list” to Tenant. Anything above to the contrary notwithstanding, Landlord shall no obligation to pay any portion of the construction allowance if Tenant is then in default of any of the terms and provisions of this Lease.
      9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of by Tenant of Tenant’s Building or Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
      9.03 Permits: Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
      9.04 Ownership of Improvements.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein excluding moveable trade fixtures and personal property of Tenant, shall become the property of Landlord, unless and to the extent Landlord elects to have Tenant remove any of the foregoing pursuant to Section 9.04 (B).
          B) Tenant shall have the right to remove all trade fixtures, equipment and furnishings, including seats, carpets, draperies, screen, sound reproducing equipment, projection equipment, furniture and lobby frames from the Premises without notice to Landlord provided, Tenant replaces all items removed with items of similar quality or better quality and the foregoing shall remain the property of the Tenant at the expiration or earlier termination of the Lease. In addition, Landlord shall have the right if Landlord so elects by giving written notice to Tenant of such election at any time before ninety (90) days prior to the end of the Term (including any renewals or extensions) hereof for Tenant to remove at Tenant’s sole cost any other Improvements and all additions, alterations and improvements thereto or replacements thereof erected, constructed, or installed on the Premises. The removal of any of the foregoing shall be completed within thirty
     
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(30) days following the end of the Term hereof (including any renewals thereof or any earlier termination permitted by this Lease.
      9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
      10.01 Landlord’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Tenant, its agents, employees, licensees, invitees or contractors on the Leased Premises, occurring within the Leased Premises or (ii) arising from Tenant’s or its employees use of the Leased Premises.
      10.02 Tenant’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Tenant and its agents, employees, tenants, licensees and contractors, Landlord shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant (and its successors, assigns and subletees), and all of their directors, officers, employees and agents, hereinafter referred to as “Tenant Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Landlord, its agents, employees, licensees, invitees on the Leased Premises or contractors, occurring within the Leased Premises, or (ii) arising from Landlord’s use of the Leased Premises.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
      11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld and subject to the CC&R’s, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease and CC&R’s. Landlord shall be entitled to all rent from any assignment or sublease in excess of the Annual Fixed Rent set forth in this Lease.
          B) Any assignment of this Lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without Landlord’s consent, assign this Lease (a) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (b) to Tenant’s Parent Corporation, or (e) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of
     
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Tenant or of Tenant’s Parent Corporation, provided that such corporation duly and validly then guarantees the performance of the obligations under this Lease.
      11.02 Notice to Landlord. Tenant shall give notice to Landlord in writing of any assignment of the Lease ten (10) days prior to such event.
ARTICLE XII
MORTGAGE SUBORDINATION
      12.01 Existing Mortgages. If there is an existing mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises or in any other part of the Leased Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
      12.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIII
CONDEMNATION — EMINENT DOMAIN
      13.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Leased Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to the Leased Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking serving the Leased Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, or any Improvements thereon or parking serving the Leased Premises which is not a Total Taking.
     
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          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
      13.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
      13.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
      13.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any for the Fair Market Value of all Land, buildings and other improvements on the Leased Premises and all Severance Damages.
          B) To Tenant, the amount awarded, if any, for loss of goodwill, lost business, lost profits, relocation expenses and fixtures; and
          C) To Landlord, any balance.
          Tenant shall only be entitled to payments under this Section 13.04 out of amounts awarded by the governmental body taking the Premises.
      13.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises or the parking taken bears to the total area of the Premises or the parking.
      13.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty-three percent (33%) of the Building or thirty-three (33%) of the parking serving the Leased Premises is taken by condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever
     
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occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
      13.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses, fixtures and relocation expenses against the acquiring governmental Agency.
ARTICLE XIV
DEFAULT
      14.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Fixed Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease; provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
      14.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 14.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
     
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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 14.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 14.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 14.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 14.02(C), Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 14.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at ten percent (10%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     
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      14.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
      14.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
      14.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 14.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party, which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. Arbitration shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association.
      14.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as
     
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may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the
arbitrator(s) hearing such action or proceeding.
ARTICLE XV
REPRESENTATIONS AND WARRANTIES
      15.01 Landlord’s Representations and Warranties .Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Leased Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Leased Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
      15.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a Delaware corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVI
DAMAGE OR DESTRUCTION
     
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      16.01 Repairs. Alterations and Further Improvements.
          In the event of damage to or destruction of the Tenant’s Building or any Improvements on or to the Premises whether or not covered by the insurance described in Article 6: Tenant shall effect, at Tenant’s sole cost and Landlord and Tenant agree that the funds derived from insurance acquired pursuant to Article 6 shall be made available to effect, such repair and reconstruction of the structure or improvement so damaged or destroyed to substantially its condition prior to said damage or destruction with such alterations thereto as Tenant shall reasonably determine prudent or valuable under the circumstances, including any changes required to comply with applicable law, with the then prevailing construction practices applicable to the Premises. Tenant shall be responsible for all costs, in excess of Insurance proceeds available. All such work shall be carried on in accordance with Drawings prepared by a licensed architect or architects approved by Landlord (acting reasonably) if such an architect is reasonably required, given the scope and nature of the work. In disbursing insurance proceeds the Tenant and Landlord may rely upon and accept the certified determinations of such architect with respect to estimated costs, awarding of contracts, sufficiency of bonds, progress of construction, interpretation of plans and specifications, compliance with same, and completion of construction. No extras or changes in Drawings shall be made by Tenant without first giving written notice of such changes to Landlord and obtaining Landlord’s approval thereof (which approval shall not be unreasonably withheld or delayed).
          If such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto, the Lease shall Terminate and any insurance proceeds shall become the property of Landlord.
      16.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated or elects to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided and subject to the provisions of subparagraph (B) of Section 16.01), and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
      16.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall thereafter not abate but continue for as long as and to the extent such Improvements are untenantable.
      16.04 Damage During Last Two (2) Years of Term. If there occurs during the last two (2) years of the Initial Term or at any time during a Renewal Period damage or destruction to any improvement on or in the Premises and the costs of repairing, restoring, replacing or rebuilding the same exceed Five Thousand Dollars ($500,000), then Tenant may elect to terminate the Term and, in such event, Tenant shall give notice to Landlord of its election within sixty (60) days after its determination of the amount of damage, and the Term shall thereupon terminate as of the date of such notice and all insurance proceeds shall become the property of Landlord.
ARTICLE XVII
MISCELLANEOUS
      17.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Leased Premises shall be limited to its interest in the Leased Premises and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Leased Premises.
     
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      17.02 Brokers. Landlord and Tenant each represent to the other that neither has any obligation to any broker or finder in connection with this transaction, and that no fee or commission is due any broker, finder, or similar person in connection herewith. Landlord and Tenant each indemnifies the other and agrees to hold the other harmless from and against any and all claims, demands, liabilities, lawsuits, costs, and expenses (including reasonable attorneys’ fees) for any fee or commission due to any other broker, finder, or similar person in connection with this transaction and arising out of the act of the indemnifying party.
      17.03 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
      17.04 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
      17.05 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of Nevada and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
      17.06 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
      17.07 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
      17.08 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
      17.09 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
      17.10 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 17.11 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 17.11 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of
     
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the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
      17.11 Addresses for Notices to Landlord and Tenant
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
150 Golden Gate Ave.
San Francisco, CA 94102
Attn.: Real Estate Department
 
       
 
  To Tenant:   Century Theatres, Inc.
150 Golden Gate Avenue
San Francisco, CA 94102
Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
      17.12 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
      17.13 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
      17.14 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges
     
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required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
      17.15 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
      17.16 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
      17.17 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
      17.18 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
      17.19 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Leased Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
      17.20 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     
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      17.21 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
      17.22 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
      17.23 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
          Executed as of the date first written above.
TENANT:
CENTURY THEATRES, INC.
a Delaware Corporation
By:  /s/ Joseph Syufy  
Print Name: Joseph Syufy
Title: SR Ex V.P.
LANDLORD:
SYUFY ENTERPRISES
a California Limited Partnership
By:  /s/ Raymond W. Syufy  
Print Name: Raymond W. Syufy
Title: GNL PTR
     
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EXHIBIT 10.26(b)
First Amendment to Lease
      This First Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises , L.P., a California limited partnership ( “Landlord” ), and Century Theatres, Inc., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)” ), entered into a lease dated March 7, 1997 (the “Lease” ) for a motion picture building and related parking (the “Premises” ) located at 1250 Victorian Ave., Sparks, Nevada; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01 (a) of the Lease, the following is hereby added:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
 
1 Century 14 – Sparks, NV

 


 

     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment
 
2 Century 14 – Sparks, NV

 


 

or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
 
3 Century 14 – Sparks, NV

 


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
       
Raymond Syufy,
  Joseph Syufy,    
Chief Executive Officer
  Chief Executive Officer    

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Century 14 – Sparks, NV
 

EXHIBIT 10.26(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “ Amendment ”) dated September 29, 2005 is executed by and between SYUFY Enterprises, L.P., a California limited partnership (“ Landlord ”), and Century Theatres, Inc. , a California corporation (“ Tenant ”).
Witnesseth:
      Whereas , Landlord and Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), entered into a lease dated March 7, 1997, as amended by that certain First Amendment to Lease dated April 15, 2005 (the “ Lease ”) for a motion picture building and related parking (the “ Premises ”) located at 1250 Victorian Ave., Sparks, Nevada; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this

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Century 14 – Sparks, NV


 

Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
       
Raymond Syufy,
  Joseph Syufy,    
Chief Executive Officer
  Chief Executive Officer    

2

Century 14 – Sparks, NV
 

EXHIBIT 10.26(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(Sparks, Nevada)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC. , a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises (“Original Landlord”)) and Century Theatres, Inc., a Delaware corporation (“Original Tenant”), entered into a certain Lease dated as of March 7, 1997 (the “Original Lease”), for certain premises located in Sparks,
Nevada.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of April 15, 2005 (the “First Amendment”) and (ii) that certain Second Amendment to Lease dated as of September 29, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

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     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***        and rather than ***        Renewal Terms of ***        each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***        consecutive Renewal Terms of ***        each, followed by ***        additional and final Renewal Term of ***       
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the Reno/Sparks metropolitan areas typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and

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ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     12.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     13.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.

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  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     14.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     15.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     16.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as

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otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  [Intentionally Omitted].
     18.  [Intentionally Omitted].
     19.  [Intentionally Omitted]
     20.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with applicable law.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President

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  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Piano, TX 75093
 
      Attention: Legal Department
     Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     21.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     22.  Prior Amendments. The First Amendment and the Second Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such First Amendment and Second Amendment in their entirety.
     23. Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:
Name:
  /s/ Joseph Syufy
 
Joseph Syufy
   
 
  Title:   CEO    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:
Name:
  /s/ Raymond syufy
 
Raymond syufy
   
 
  Title:   CEO    

 

 

EXHIBIT 10.27(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
CENTURY STADIUM PROMENADE LEASE
BY AND BETWEEN
SYUFY ENTERPRISES
CALIFORNIA LIMITED PARTNERSHIP
LANDLORD
AND
CENTURY THEATRES, INC.
DELAWARE CORPORATION
TENANT

 


 

CENTURY STADIUM PROMENADE LEASE
     THIS LEASE AGREEMENT (referred to herein as the “Lease”) is made this 1st day of October, 1996, by and between Syufy Enterprises, a California Limited Partnership, (“Landlord”), and Century Theatres, Inc., a Delaware Corporation (“Tenant”).
ARTICLE I
EXHIBITS AND BASIC LEASE TERMS
      Section 1.01. Attachments to Lease and Exhibits:
           EXHIBIT A — Site Plan for “Entire Premises” commonly knows as the “Century Stadium Promenade” showing the location of the Tenant’s Building outlined in red.
           EXHIBIT B — Tenant Sign Criteria
      Section 1.02. Basic Lease Terms and Definitions.
          1.02.1. “ Entire Premises” shall mean “Century Stadium Promenade” located in the City of Orange, State of California.
          1.02.2. “Commencement date shall mean the date which is the earlier of (i) nine months after Tenant has received a building permit for the construction of Tenant’s Building or (ii) the date on which Tenant opens for business in the Premises.
          1.02.3. “Term” shall mean Initial Term of ***           with ***           options and ***      option.
          1.02.4. Tenant’s Trade Name. Century Theatres.
          1.02.5. Floor Area. Approximately 99,870 square feet.
          1.02.6. Minimum Rent.
                     
    Dollars/ Years   Dollars/Month   Dollars/sq. ft.   Years    
 
  ***   ***   ***   ***    
 
                   
 
  ***   ***   ***   ***    
 
                   
 
  ***   ***   ***   ***    
 
                   
 
  ***   ***   ***   ***    
 
                   
 
  ***   ***   ***   ***    
 
                   
 
  ***   ***   ***   ***    
 
                   
 
  ***   ***   ***   ***    
          1.02.7. Percentage Rate. ***
          1.02.8. Premises. Century Stadium Theatre Parcel.
          1.02.9. Use of Premises. A Motion Picture Theatre.
          1.02.10. Contribution to Grand Opening Fund. $1,000.00
          1.02.11. Security Deposit. None.
ARTICLE II
LEASED PREMISES
Section 2.01. Leased Premises.
     Landlord hereby leases to Tenant, and Tenant hereby rents from Landlord, those certain premises and improvements located in the Entire Premises, consisting of approximately 99,870 square feet of gross leasable area, (the “Premises” or “Leased Premises”). “Area” means all areas designated by Landlord for the exclusive use of Tenant. The boundaries and location of the Premises arc depicted on the site plan of the Entire Premises, which is attached hereto as Exhibit A (the “Site Plan”) and shall be deemed to include the entryway to such building. The site plan and shape and dimensions of the area of the Premises are depicted on Exhibit A.

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      Section 2.02. Reservations.
     Landlord reserves the right at any time to make alterations or additions and to construct other buildings, improvements, alterations or additions in the Entire Premises. These alterations and additions however shall not materially impede reasonable access to the Premises. Easements for light and air are not included in the Premises. Landlord further reserves the right to go on the roof of the Premises for the purpose of effecting certain items of repair and maintenance as provided in this Lease.
      Section 2.03. Right to Relocate.
     Landlord reserves the right at any time to make changes to the various buildings, parking, and other common areas as shown on the Site Plan.
      Section 2.04. Conditions of Record.
     Landlord’s Title is subject to: (a) the effect of any covenants, conditions, restrictions, easements, development agreements, mortgages or deeds of trust, ground leases, rights of way, and other matters or documents of record now or hereafter recorded against Landlord’s title, (b) the effects of any zoning laws of the city, county and state where the Entire Premises is situated, and (c) general and special taxes and assessments not delinquent. Tenant agrees (I) that as to its leasehold estate it, and all persons in possession or holding under it, will conform to and will not violate said matters of record, and (ii) that this Lease is and shall be subordinate to said matters of record and any amendments or modifications thereto.
ARTICLE III
TERM
      Section 3.01. Commencement of Term.
     This Lease shall be effective upon mutual execution. The term of this Lease the (“Term”) shall commence as specified in Section 1.02.2 and shall continue for the term specified in Section 1.02.3 unless sooner terminated in accordance with the provisions of this Lease. The term shall commence from the first day of the month following the Rent Commencement Date. If the Term commences prior to Tenant’s obligation to pay rent, Tenant shall be required to pay all sums set forth in Section 12.05 of this Lease on the day the Term commences. Upon request of Landlord, Tenant shall execute a written confirmation of the commencement of the Term and the Rent Commencement Date upon a form to be supplied by Landlord.
      Section 3.02. Extension of Term.
     Tenant shall have the right to extend the term of this Lease for ***      additional ***      period(s) and ***      additional ***      period under the same terms and conditions as the original Lease, except for the amount of Minimum Rent. It is understood that this option is unique to Century Theatres, Inc., and upon any assignment or subletting, without Landlord’s consent, the option shall be rendered null and void. If Tenant is in default on the date of giving the option notice, the option notice shall be totally ineffective, or if Tenant is in default on the date the extended term is to commence, the extended term shall not commence and this Lease shall expire at the end of the initial term.
     In order to exercise such option to renew or extend this Lease, Tenant shall give to Landlord notice, in writing, of its intention to do so at least one hundred eight (180) days prior to then applicable expiration date of this Lease, and if Tenant shall fail to timely give such notice, all rights and privileges as granted to Tenant to renew or extend this Lease shall thereupon be null and void.
ARTICLE IV
RENT
      Section 4.01. Rent Commencement Date.
     Tenant’s obligation to pay Minimum Rent and Percentage Rent under this Lease shall commence on the first to occur of (the “Rent Commencement Date”): (a) the date Tenant first opens for business to the public in the Premises; or (b) nine months after Tenant has obtained a building permit for the construction of Tenant’s Building. If the Rent Commencement Date does not occur on the first day of the month, Tenant shall pay rent for the fractional month on a per diem basis (calculated on the basis of a thirty day month) until the first day of the month next succeeding the date Tenant’s obligation to pay rent commences. The Minimum Rent shall be paid thereafter in equal monthly installments on or before the first day of each month in advance without demand or offset. The Minimum Rent to be paid by Tenant during the Term of this Lease is set forth in Section 1.02.6
      Section 4.02. Percentage Rent
     In addition to the Minimum Rent and all other sums designated in this Lease to be paid as Rent, Tenant shall pay Landlord Percentage Rent for each fiscal year during the Term, or fractional period thereof. In the event that Tenant commences business in the Premises prior to October 1, but after the preceding September 1, the period prior to October 1 and after January 1 shall be added to and included in the first full fiscal year of the Term, and Tenant’s Minimum Rent for that month or partial month shall be included in the Minimum Rent figure for such full fiscal year.

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     If Tenant actually commenced business in the Premises prior to October 1, for more than one month, then Percentage Rent shall be computed based on such partial year. If the Term expires on a day other than September 30, then Tenant’s Percentage Rent shall be computed based on such partial fiscal year.
     Percentage Rent shall be calculated as follows:
  1.   Tenant’s annual Minimum Rent divided by the Percentage Rent Rate (specified in Section 1,02.7) equals “Percentage Rent Break Point”.
 
  2.   If Tenant’s Gross Receipts for the calendar year exceed the Percentage Rent Break Point, Tenant shall pay the Percentage Rent Rate of Tenant’s Gross Receipts less Minimum Rent actually paid.
 
  3.   Example of the foregoing:
             
 
  Tenant’s annual Minimum Rent   =   ***
 
           
 
  Percentage Rent Rate   =   *** 
 
           
 
  Percentage Rent Break Point   =   *** 
 
            ***        
 
           
 
  Gross Receipts   =   *** 
 
           
 
  ***   =    
 
           
 
  Less Minimum Rent Paid       *** 
 
           
 
  Tenant owes as Percentage Rent       *** 
Within sixty (60) days following the end of each calendar year, Tenant shall deliver to Landlord the written statement required by Section 6.02 of this Lease showing Tenant’s Gross Receipts for the preceding calendar year. Tenant shall pay to Landlord at the time of delivery of the written statement the percentage specified in Section 1.02.7 of the amount by which such Gross Receipts exceeded the Percentage Rent Break Point, less any Minimum Rent previously paid with respect to that calendar year
      Section 4.03. Gross Receipts Defined.
     “Gross Receipts” means (a) the entire amount charged for the full price at the time of the initial transaction for all merchandise sold or delivered or services rendered by Tenant whether for cash or credit; (b) the gross amount received or charged by Tenant for merchandise sold or services rendered pursuant to orders received by telephone, mail, house to house, or by other canvassing, and attributable to the Premises whether or not filled elsewhere; and (c) all gross income of Tenant from any operation in, at, from or through the use of the Premises. Excluded from the calculation of “Gross Receipts” are (I) cash refunded or credit allowed on merchandise returned by customers; (ii) sales taxes, excise taxes, other similar taxes; (iii) proceeds from sales of fixtures, equipment, or property which are not stock-in-trade; (iv) sales to employees representing discounts or compensation benefits and for which Tenant realizes no monetary profit in an amount not to exceed two percent (2%) of Gross Receipts and (v) EBF passes..
      Section 4.04. Additional Rental.
     All other sums required to be paid by Tenant to Landlord pursuant to this lease in addition to Minimum Rent and Percentage Rent, whether or not designated as rent and additional rent, unless otherwise specified. Rent for any period which is less than one (1) month shall be a prorated portion of the monthly rent installment based upon a thirty (30) day month.
      Section 4.05. Late Payment.
     If the Tenant fails to pay the Minimum Rent or any installment thereof or Percentage Rent, if any, or any other additional rent due under this Lease within five (5) days after such Rent has become due, both Tenant and Landlord agree that Landlord will incur additional expenses consisting of extra collection efforts, handling costs and potential impairment of credit on loans which may be secured by this Lease. Both parties agree that should Tenant fail to pay its Rent, Landlord is entitled to compensation for detriment caused by the failure, but that it is extremely difficult and impractical to ascertain the extent of the detriment. The parties therefore agree that should Tenant fail to pay any Rent due hereunder within five (5) days after the same becomes due, Landlord shall be entitled to recover from Tenant five percent (5%) of the amount past due as liquidated damages. Such past due amounts shall also bear interest at the maximum rate allowed by law from the date due until paid. Tenant further agrees to pay Landlord any costs incurred by Landlord in the collection of such past due Rent including, but not limited to, fees of an attorney and/or collection agency. Nothing herein contained shall limit any other remedy of Landlord under this Lease. Landlord shall also have the right to require Tenant to pay any past due sums by cashier’s check or money order.
     Further, should Tenant fail to pay Rent or any other charges due hereunder in the time periods set forth herein, two (2) or more times during any calendar year of the Term, Landlord may require Tenant to thereafter pay Rent in quarterly installments in advance for the balance of the Term.

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ARTICLE V
CONSTRUCTION OF LEASED PREMISES
      Section 5.01. Landlord’s and Tenant’s Obligations.
     (a) Landlord’s Obligation:
          Subject to delay as provided in this Lease, Landlord, at its own cost and expense, shall develop the building pad in accordance with plans and specifications prepared by Landlord or Landlord’s architect, including the design and construction of all utility lines to the boundary of the Premises in adequate size to service Tenant’s requirements.
     (b) Tenant’s Obligation:
          Tenant shall construct the theatre building and improvements in accordance with plans and specifications prepared by Tenant. Any work to be performed by Tenant and any permits, fees or applications for such work shall be performed or obtained by Tenant at its sole cost and expense (collectively, “Tenant’s Work”). Tenant shall pay for any equipment or work to be installed in or constructed on the Premises by Landlord other than Landlord’s Work prior to commencement of construction or installation of such additional items.
     (c) Tenant’s Allowance.
          Landlord agrees to provide Tenant with an improvement allowance of up to a maximum of Eight Million Four hundred Eighty Eight thousand Nine Hundred Fifty ($8,488,950) dollars ($85 per square foot) (Tenant Allowance). Tenant shall pay any difference between the total Tenant building and improvement cost less the Tenant Allowance. Landlord agrees that it shall pay to Tenant, or at Tenant’s direction, to Tenant’s contractor, within fifteen (15) days following Landlord’s receipt of conditional lien waivers signed by its contractor, in form reasonably sufficient to waive lien rights in Orange County, California, an amount equal to the Tenant Allowance multiplied by the percentage of work completed as of the date of the lien waivers, less any installments of Tenant Allowance already paid. If the total contract for Tenant’s Work exceeds Tenant’s Allowance, Landlord shall only be required to pay its pro-rata share which shall be the ratio of Tenant’s Allowance to the total of Tenant’s Work. if Landlord disputes any portion of the request for payment by Tenant due to faulty or incomplete work, then Landlord shall withhold a sum which, in Landlord’s opinion would be required to correct or complete the disputed work. In this event, Landlord shall submit a written “punch list” to Tenant.
     Anything above to the contrary notwithstanding, Landlord shall have no obligation to pay any portion of the construction allowance if Tenant is then in default of any of the terms and provisions of this Lease.
      Section 5.02. Possession.
Upon substantial completion by Landlord of Landlord’s Work on the Premises, Landlord shall deliver the Premises to Tenant. Tenant waives any right or claim against the Landlord for any cause directly or indirectly, arising out of the condition of the Premises, appurtenances thereto, the improvements thereon and the equipment thereof. Tenant shall save and hold harmless the Landlord from liability as provided in this Lease. Landlord shall not be liable for any latent or patent defects therein.
      Section 5.03. Commencement of Construction and Completion.
     Prior to commencement of Tenant’s Work, Tenant shall notify Landlord in writing of the date Tenant will commence construction. Tenant’s contractor shall commence the construction of Tenant’s Work promptly upon possession of the Premises by Tenant and shall diligently pursue such construction to completion. Tenant shall record within ten (10) days of completion of Tenant’s Work, a valid Notice of Completion and thereafter deliver to Landlord prior to opening for business a certified copy of such Notice along with final lien releases for all contractors, subcontractors, materialmen and suppliers covering all improvements and work performed by Tenant and/or Tenant’s contractor on the Premises.
      Section 5.04. Delay in Possession
     Landlord shall not be liable for failure to deliver possession of the Premises to Tenant. If Landlord fails to deliver possession of the Premises on or before the expiration of two (2) year from the date of lease execution (subject to extension for any force majeure or inability to obtain financing), either party may terminate this Lease by giving thirty (30) days written notice to the other party. Thereafter, neither party shall have any further liability to the other in connection with this Lease.
ARTICLE VI
RECORDS AND BOOKS OF ACCOUNT
      Section 6.01. Tenant’s Records.
     Tenant shall maintain and keep on the Premises or at Tenant’s principal office in California for a period of not less than three (3) years following the end of each year during the Term, adequate records which show Gross Receipts, inventories and receipts of merchandise at the Premises, and daily receipts from all sales and other transactions on the Premises by Tenant and any other persons conducting any business upon the Premises. Tenant shall record at the time of sale, in the presence of the customer, all receipts from sales or other transactions, whether for cash or credit, in a cash register or in cash registers having a cumulative total which shall be sealed in a reasonable manner, and having such other reasonable features as may be appropriate or required in order to properly account for and record all sales or other transactions in and from the Premises. If upon an audit of Tenant’s books and records by Landlord, Landlord determines that Tenant’s manner of recording sales is inadequate, Tenant agrees to adopt such measures as Landlord may reasonably request to correct such inadequacies. Tenant further agrees to keep on the Premises or at Tenant’s principal office in California for at least three (3) years following the end of each year during the Term all pertinent original sales records. Original

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sales records may include any or all of the following: (a) cash register tapes, including tapes from temporary registers; (19) serially numbered sales slips; (c) computer printouts and computerized sales slips; (d) the originals of all mail orders at and to the Premises; (c) the original records of all telephone orders at and to the Premises; (f) settlement report sheets of transactions with subtenants, concessionaires and licensees; (g) the original records showing that merchandise returned by customers was purchased at the Premises by such customers; (h) memorandum receipts or other records of merchandise taken out on approval; (I) records of inventory purchases; (j) such other sales records, if any, which would normally be examined by an independent accountant pursuant to generally accepted auditing standards in performing an audit of Tenant’s Gross Receipts; and (k) the records specified in (a) to (j) above for subtenants, assignees, concessionaires or licensees of Tenant.
      Section 6.02. Reports by Tenant.
     Tenant shall submit to Landlord on or before the sixtieth (60th) day following each calendar year during the Term hereof at the place then fixed for the payment of rent, or at such other place designated by Landlord, a written statement signed by Tenant, and certified by it to be true and correct, showing in reasonable, accurate detail, the amount of Gross Receipts for each preceding year.
     Tenant shall submit to Landlord on or before the sixtieth (60th) day following the end of each calendar year at the place then fixed for the payment of rent, a written statement signed by Tenant, and certified to be true and correct showing in reasonably accurate detail satisfactory in scope to Landlord, the amount of Gross Receipts during the preceding calendar year. At Landlord’s option, the written statement shall be duly certified to Tenant and Landlord by independent certified public accounts of recognized standing. The accounting statement referred to in this Section 6.02 shall be in such form and style and contain such details and breakdown as the Landlord may reasonably require.
     If Tenant fails to timely submit to Landlord either the monthly or annual written statement described in this Section 6.02, Tenant shall pay to Landlord, as additional rent and without limiting any other remedy Landlord may have against Tenant under this lease as a result of this breach, a $100.00 (increased each year according to the Index) charge for each and every month that the Tenant fails to timely submit such written statement. Alternatively, Landlord shall have the right, upon five (5) days written notice, to audit Tenant’s records at Tenant’s expense.
      Section 6.03. Annual Balance Sheet
     Tenant shall provide Landlord, whenever reasonably requested by Landlord, a current annual balance sheet for Tenant’s business at the Premises, either certified by Tenant or if Tenant is a corporation, by Tenant’s chief financial officer, to be true and correct or accompanied by a report of an independent certified public accountant.
ARTICLE VII
AUDIT
      Section 7.01. Right to Examine Books.
     The acceptance by Landlord of payments of Percentage Rent shall be without prejudice to Landlord’s right to examine Tenant’s books and records concerning Gross Receipts from the Premises.
      Section 7.02. Audit.
     As its option, Landlord may cause, at any reasonable time and upon five (5) days prior written notice to Tenant, a complete audit to be made of Tenant’s entire business affairs and records relating to the Premises for the period covered by any statement issued by the Tenant in accordance with Section 6.02. If such audit discloses that Tenant has under-reported Gross Receipts by more than three percent (3%) for such period, Tenant shall promptly pay to Landlord within ten (10) days the cost of its audit and any deficiency in amounts owed as disclosed by the audit. The deficiency shall be considered a late payment pursuant to Section 4.06. In the event that Tenant is in default of this Lease by under-reporting Gross Receipts by more than three percent (3%) as determined by two successive audits, Landlord may terminate this Lease upon five (5) days written notice to Tenant. In such event, Landlord shall have all remedies set forth in Section 22.02.
ARTICLE VIII
TAXES
      Section 8.01. Real Property Taxes.
     Tenant agrees to pay its pro rata share of all general and special real property taxes and assessments and governmental levies and charges of any and every kind, nature and sort whatsoever, ordinary and extraordinary, foreseen and unforeseen, and substitutes therefor or supplements thereto, including the cost to Landlord of any appeals or contests of any taxes or assessments, except any inheritance, estate, succession, transfer or gift tax imposed on Landlord or any income tax specifically payable by Landlord as a separate tax-paying entity without regard to Landlord’s income source as arising from or out of the Entire Premises (collectively “Real Property Taxes”), which may be levied or assessed by any lawful authority against the Entire Premises applicable to the period from the commencement of the Term until the expiration or sooner termination of this Lease. Tenant’s pro rata share shall be apportioned according to the floor area of the Premises as it relates to the total leasable floor area of the Building or buildings located within the Entire Premises (including the Premises). Notwithstanding the foregoing provisions, if the Real Property Taxes arc not levied and assessed against the Entire Premises by means of a single tax bill (i.e., if the Entire Premises is separated into two (2) or more separate tax parcels for purposes of levying and assessing the Real Property Taxes), then, at Landlord’s option, Tenant shall pay Tenant’s pro rata share of all Real Property Taxes which may be levied or assessed by any lawful authority against the land and

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improvements of the separate tax parcel on which the Building containing the Premises is located. Tenant’s pro rata share under such circumstances shall be apportioned according to the floor area of the Premises as it relates to the total leasable floor area of the Building or buildings situated in the separate parcel in which the Premises are located.
     All Real Property Taxes for the tax year in which the Term commences and for the tax year in which this Lease terminates shall be apportioned and adjusted so that Tenant shall not be responsible for taxes and assessments for a period of time occurring prior to the time the Term commences or subsequent to the Term.
     The amount to be paid pursuant to the provisions of this Section 8.01 shall be paid monthly in advance without demand or offset as estimated by Landlord based on the most recent tax bills and estimates or reappraised values (if reappraisal is to occur), commencing with the month (or partial month on a prorated basis if such be the case) that the Term commences.
     If at any time during the Term, a tax, fee or excise is levied or assessed by any political body against Landlord on account of rent payable to Landlord hereunder, the square footage of the Premises, the act of entering into this Lease or the occupancy of Tenant or any other tax however described or any tax based on or measured by expenditures made by Tenant on behalf of Landlord, including the so-called value added tax, such tax, fee or excise shall be considered “Real Property Taxes” for purposes of this Section 8.01, and shall be payable in full by Tenant. At Landlord’s option, such taxes, fees or excises shall be payable monthly in advance on an estimated basis as provided in this Section 8.01 or shall be payable within ten (10) days after Tenant’s receipt of the tax bill therefor from Landlord.
      Section 8.02. Increase in Taxes.
     In addition to the Real Property Taxes described above in Section 8.01, Tenant shall pay one hundred percent (100%) of any increase in Real Property Taxes as a result of any Tenant’s Work or any other leasehold improvements, alterations or changes made by Tenant to the Premises during the Term. Tenant shall reimburse Landlord promptly upon demand.
      Section 8.03. Personal Property Taxes.
     Tenant shall pay prior to delinquency all federal, municipal, county or state taxes, charges, assessments and fees assessed during the Term against any leasehold interest or personal property of any kind, owned by or placed in, upon or about the Premises by Tenant.
ARTICLE IX
SECURITY DEPOSIT
           Section 9.01. Amount of Deposit .
     Upon signing this Lease, Tenant shall deposit with Landlord the sum set forth in Section 1.02.12 herein (“Security Deposit”). This Security Deposit shall be held by Landlord, without liability for interest, as partial security for the full and faithful performance by Tenant of all the terms, covenants, and conditions of this Lease to be performed by Tenant. Landlord may commingle the Security Deposit and shall not be required to keep it separate from its general funds.
      Section 9.02. Use and Return of Deposit.
     In the event of the failure of Tenant to abide by any of the terms, covenants and conditions of this Lease, then Landlord, at its option, may use any amount of the Security Deposit to compensate Landlord for any loss or damage sustained or suffered due to such failure by Tenant. The entire Security Deposit, or any portion thereof, may also be applied by Landlord to the payment of overdue rent or other sums due and payable to Landlord by Tenant hereunder. In this event, Tenant, upon the written demand of Landlord, shall immediately remit to Landlord a sufficient amount in the form of a cashier’s check to restore the Security Deposit to the original sum deposited. Failure to do so within five (5) days after such demand shall constitute a material breach of this Lease. Should Tenant comply with all of the terms, covenants and conditions of this Lease and promptly pay when due all of the Rent and all other sums payable by Tenant to Landlord, the Security Deposit will be returned to Tenant in accordance with applicable law.
      Section 9.03. Transfer of Security Deposit.
     Landlord shall deliver the Security Deposit to the purchaser of Landlord’s interest in the Premises, in the event that such interest is sold, and upon delivery, Landlord shall be discharged from any further liability respect to repayment of the Security Deposit to Tenant.
ARTICLE X
CONDUCT OF BUSINESS BY TENANT
      Section 10.01. Use of Premises.
     Tenant shall use the Premises solely for the use and under the trade name specified in Sections 1.02.9 and 1.02.4, respectively, herein, and for no other purpose. The term “Use” shall mean the operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games, operation of concession stands, sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.

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     Tenant shall not (a) do or permit anything to be done in or about the Premises which will in any way obstruct or interfere with the rights of other occupants of the Entire Premises or injure or annoy them, (b) cause, maintain or permit any nuisance in, on or about the Premises, (c) use or allow the Premises to be used for any unlawful purpose, (d) commit or allow to be committed any waste in or upon the Premises, (e) display or allow carts, pallets or similar items owned by or within the control of Tenant or Tenant’s merchandise to be stored or to remain outside the defined exterior walls and permanent doorways of the Premises, (f) install any exterior lighting, amplifier or similar devices, or use in or abut the Premises any advertising medium or device which may be heard or seen outside the Premises, such as flashing lights, search lights, loud speakers, phonographs or radio broadcasts, (g) permit to be conducted any sale by auction in, upon or from the Premises whether voluntary, involuntary, pursuant to any assignment for the payment of credits pursuant to any bankruptcy or any other insolvency proceedings, or any distress or fire or bankruptcy or going-out-of-business sale, or (h) conduct any sidewalk sale. Tenant shall at all times keep the Premises in a neat and attractive appearance.
     Tenant shall not use, or permit the Premises, or any part thereof, to be used for any purposes other than the purposes for which the Premises are hereby leased. No gaming machines shall be permitted on the Premises. No use shall be made or permitted to be made of the Premises, nor acts done, which will increase the existing rate of insurance upon the Building or the Entire Premises, or cause a cancellation of any insurance policy covering the Building or the Entire Premises or any part thereof. Tenant shall not sell or permit to be kept, used, stored or sold in or about the Premises any article which may be prohibited by standard form fire insurance policies. Tenant, at its sole cost, shall comply with any and all laws concerning the Premises or Tenant’s use of the Premises, including, without limitation, the obligation at Tenant’s cost to alter, maintain or improve the Premises in compliance with and conformity with all laws relating to the condition, use or occupancy of the Premises during the term (including the Americans With Disabilities Act). Tenant shall also comply with the requirements of any insurance organization or company necessary for the maintenance of the fire and public liability insurance described in this Lease covering the Building and its appurtenances. If Tenant’s use of the Premises results in a rate increase for the Building or the Entire Premises, Tenant shall pay with in ten (10) days of billing from Landlord, as additional rent, a sum equal to the additional premium caused by such rate increase.
      Section 10.02. Operation of Business.
     Tenant shall open for business in the Premises no later than the Rent Commencement Date and shall thereafter operate continuously for business to the public in the Premises. Tenant shall operate one hundred percent (100%) of the Premises during the entire Term with due diligence and efficiency so as to maximize the Gross Receipts which may be produced by Tenant’s business therein. Tenant shall carry at all times in the Premises a stock of merchandise of such size, character and quality as shall be reasonably designed to produce the maximum return to Landlord and Tenant. Tenant shall conduct its business in the Premises during the usual and customary days and hours for such type of business, or during times designated by Landlord for other tenants at the Entire Premises. In the latter event, Landlord will notify Tenant in writing of the designated Entire Premises days and hours. Tenant’s obligation to continuously operate its business in the Premises shall not apply if the Premises should be closed and the business of Tenant temporarily discontinued therein for not more than three (3) days out of respect to the memory of any deceased officer or employee of Tenant, or the relative of any such officer or employee. Tenant shall install and maintain at all times displays of merchandise in the display windows (if any) for the Premises. Tenant shall keep the display windows and signs, if any, in the Premises well lighted during the hours from sundown to 11:00 p.m.
     In the event Tenant fails to take possession of the Premises or to open for business fully fixturized, stocked and staffed by the Rent Commencement Date, or fails to fully operate its business in the Premises at any time during the term in accordance with this Section 10.02, then Landlord, in addition to any and all remedies otherwise provided in this Lease, shall have the right to collect a sum equal to the greater of (i) twice the Minimum Rent per day, or (ii) $100.00 for each and every day after the Rent Commencement Date that Tenant shall fail to be open for business in the Premises in accordance with the terms of this Lease. This additional rent is intended to compensate Landlord for loss of Rent that may have been earned during the period Tenant is not open for business, for damages suffered by the Landlord to the Entire Premises as a whole by reason of Tenant’s not being open and for additional costs and expenses that Landlord may incur by reason of increased administrative expenses and security costs for the Entire Premises. Tenant acknowledges and agrees that Landlord is executing this Lease in reliance on Tenant’s covenant and obligation to continuously operate its business in the Premises in accordance with this Lease and that such obligation and covenant to the Landlord is a material element of consideration inducing Landlord to execute this Lease. The foregoing provision for additional rent shall not apply during any temporary closure for a maximum of three (3) days as set forth above, or due to casualty damage or condemnation (in which either event Tenant shall recommence the conduct of its business in accordance with the terms of this Lease within the time periods specified in this Lease after restoration and redelivery of the Premises to the Tenant).
      Section 10.03. Competition.
     During the Term, neither Tenant, nor any entity owned or controlled directly or indirectly by Tenant, its partners, shareholders or directors, shall, without the prior written consent of Landlord, directly or indirectly engage in any similar or competing business with that to be operated by Tenant in the Premises within a radius of two (2) miles from the outside boundary of the Entire Premises.
      Section 10.04. Storage, Office Space.
     Tenant shall warehouse, store and/or stock in the Premises, only such goods, wares and merchandise as Tenant intends to offer for retail sale at, in, from or upon the Premises. This shall not preclude occasional emergency transfers of merchandise to the other stores of Tenant, if any, not located in the Entire Premises. Tenant shall use for office, clerical or other non-selling purposes only such space in the Premises as is from time to time reasonably required for Tenant’s business in the Premises.
      Section 10.05. Compliance with Environmental Laws.

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     Tenant at all times and in all respects shall comply with all federal, state and local laws, ordinances and regulations (“Hazardous Materials Laws”) relating to industrial hygiene, environmental protection or the use, generation, manufacture, storage, disposal or transportation of any hazardous, toxic, contaminated or polluting materials, substances or wastes, including, without limitation, oil or other petroleum products, flammable explosives, asbestos, or any “hazardous substances,” “hazardous wastes,” “hazardous materials” or “toxic substances” regulated under any Hazardous Material Law (collectively, “Hazardous Materials”). Tenant at its own expense shall procure, maintain in effect and comply with all conditions of any and all permits, licenses and other governmental and regulatory approvals required for Tenant’s use of the Premises. In all respects, Tenant shall handle, treat, deal with, manage and dispose of any and all Hazardous Materials in total conformity with all applicable Hazardous Materials Laws and prudent industry practices. Upon expiration or earlier termination of the term of the Lease, Tenant shall cause all Hazardous Materials to be removed from the Premises and transported for use, storage, or disposal in accordance and compliance with all applicable Hazardous Materials Laws. If Tenant fails to do so, Landlord may remove such Hazardous Materials at Tenant’s expense.
     If at any time it reasonably appears to Landlord that Tenant is not maintaining sufficient insurance or other means of financial capacity to enable Tenant to fulfill its obligations to Landlord in connection with this Section 10.05, whether or not then accrued, liquidated, conditional or contingent, Tenant shall procure and thereafter maintain in full force and effect such insurance or other form of financial assurance, with or from companies or persons and in forms reasonably acceptable to Landlord, as Landlord may from time to time reasonably request.
      Section 10.06. Sewer Damage
     Tenant agrees not to discharge any acid or other harmful or dangerous chemicals into the sewer system, whether it be inside the Premises area or inside the main system leading from the Premises to the main sewer line. Should Tenant discharge any acid or harmful chemicals into the sewer system, Tenant shall be fully responsible for the cost and repair of such damage. Landlord reserves the right to select an expert of its choosing to inspect any damage at Tenant’s cost. Tenant shall not be responsible for cost of expert if it is determined such damage is not caused by Tenant. Tenant accepts responsibility for any damage if the following conditions exist: (a) the damage to the sewer system is determined to be due to the chemicals used in the operation of Tenant’s business; (b) the damage exists only in the designated portion of the sewer system.
      Section 10.07. Tenant’s Use — No Nuisance
     Tenant acknowledges that odors emanating from Tenant’s store as a result of Tenant’s operation can become a nuisance to other Tenants within the Entire Premises. Therefore, Tenant agrees to take whatever measures are necessary to eliminate odors emanating from the leased premises at Tenant’s sole cost and expense. If the odor problem is not remedied by Tenant, Landlord has the right to have odor nuisance inspected and remedied by an expert of Landlord’s and Tenant’s choosing at Tenant’s sole cost.
      Section 10.08. Tenant’s Covenant
     The Tenant herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions.
     “That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subleases, subtenants or vendees in the premises herein leased.”
ARTICLE XI
MAINTENANCE AND REPAIRS
      Section 11.01. Tenant’s Maintenance Obligations.
     Tenant, at its sole cost and expense, shall keep the Premises in first class order, condition and repair and shall make all replacements necessary to keep the Premises including the Theatre Building and improvements in such condition. All replacements shall be of a quality equal to or exceeding that of the original. Should Tenant fail to make these repairs and replacements or otherwise so maintain the Premises for a period of three (3) days after written demand by Landlord, or should Tenant commence, but fail to complete, any repairs or replacements within thirty (30) days after written demand by Landlord, Landlord may enter the Premises and make such repairs or replacements without liability to Tenant for any loss or damage that may occur to Tenant’s stock or business, and Tenant shall pay to Landlord the costs incurred by Landlord in making such repairs or replacements together with interest thereon at the maximum rate permitted by law from the date of commencement of the work until repaid. Tenant, at its expense, shall repair promptly any damage to the Building or the Entire Premises caused by Tenant or its agents or employees or caused by the installation or removal of Tenant’s personal property. Tenant shall contract with a service company licensed and experienced in servicing HVAC equipment and approved by Landlord for the quarterly maintenance of the HVAC equipment serving the Premises and shall provide Landlord with a copy of the service contract within ten (10) days following its execution. If Tenant fails to timely deliver a copy of the service contract, Landlord may impose a late charge in the amount of $50.00 per month until the copy is delivered. The sum so billed to Tenant shall become immediately due to Landlord as additional rent. Landlord, at its option, may contract with a service company of its own choosing, or provide such service itself, for the maintenance of the HVAC equipment, and bill Tenant for the cost of same.

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     Tenant, at its own expense, shall comply with all requirements for the installation and periodic maintenance of the fire extinguisher or automatic dry chemical extinguishing system.
      Section 11.02. Plate Glass.
     Tenant shall promptly replace, at its expense, any and all plate and other glass damaged or broken from any cause whatsoever (except Landlord’s direct act) in and about the Premises. Tenant shall have the option either to insure this risk or self insure.
ARTICLE XII
COMMON AREA
      Section 12.01. Definition of Common Area.
     The term “Common Area,” as used in this Lease means all areas within the exterior boundaries of the Entire Premises now or later made available for the general use of Landlord and other persons entitled to occupy floor area in the Entire Premises. Without limiting this definition, Landlord may include in the Common Area those portions of the Entire Premises presently or later sold or leased until the commencement of construction of building(s) thereon, at which time such areas shall be withdrawn from the Common Area. Common Area shall not include (a) the entryway to a tenant’s premises, (b) any improvements installed by a tenant outside of its premises, whether with or without Landlord’s knowledge or consent, or (c) any areas or facilities that could be considered as Common Area except that the areas or facilities are included in the description of premises leased to a tenant.
      Section 12.02. Maintenance and Use of Common Area.
     The manner in which the Common Area shall be maintained shall be solely determined by Landlord. If any tenant of any portion of the Entire Premises maintains its own Common Area (Landlord shall have the right in its sole discretion to allow any tenant to so maintain its own Common Area and be excluded from participation in the payment of Common Area Expenses as provided below), Landlord shall not have any responsibility for the maintenance of that portion of the Common Area; Tenant hereby waives any claims or damages arising out of any failure of such Landlord or tenant to so maintain its portion of the Common Area.
     The use and occupancy by Tenant of the Premises shall include the right to use the Common Area (except those portions of the Common Area on which have been constructed or placed permanent or temporary kiosks, displays, carts and stands and except areas used in the maintenance or operation of the Entire Premises), in common with Landlord and tenants of the Entire Premises and their customers and invitees, subject to such reasonable, non-discriminatory rules and regulations concerning the use of the Common Area as may be established by Landlord from time to time. Written notice of such rules and regulations and amendments and supplements thereto, if any, shall be given to Tenant fifteen (15) days prior to their effective date. Tenant agrees to promptly comply with all such rules and regulations upon receipt of written notice from Landlord. Landlord shall have no liability if any Landlord or tenant does not comply with such rules and regulations.
     Tenant and Tenant’s employees and agents shall not solicit business in the Common Areas, nor shall Tenant distribute any handbills or other advertising matter on automobiles parked in the Common Area.
      Section 12.03. Control of and Changes to Common Area.
     Landlord shall have the sole and exclusive control of the Common Area. Landlord’s rights shall include, but not be limited to, the right to (a) restrain the use of the Common Area by unauthorized persons; (b) cause Tenant to remove or restrain persons from any unauthorized use of the Common Area if they are using the Common Area by reason of Tenant’s presence in the Entire Premises; (c) utilize from time to time any portion of the Common Area for promotional, entertainment and related matters; (d) place permanent or temporary kiosks, displays, carts and stands in the Common Area and to lease same to tenants; (e) temporarily close any portion of the Common Area for repairs, improvements or alterations, to discourage non-customer use, to prevent dedication or an easement by prescription, or for any other reason deemed sufficient in Landlord’s judgment; and (f) reasonably change the shape and size of the Common Area, add, eliminate or change the location of improvements to the Common Area, including, without limitation, buildings, lighting, parking areas, roadways and curb cuts, and construct buildings on the Common Area. Landlord may determine the nature, size and extent of the Common Area and whether portions of the same shall be surface, underground or multiple-deck; as well as make changes to the Common Area from time to time which in Landlord’s opinion are deemed desirable for the Entire Premises. Landlord’s right in this Section 12.03 may be shared in common with other Landlords of the Entire Premises.
      Section 12.04. Common Area Expenses.
     The term “Common Area Expenses” as used in this Lease means all costs and expenses incurred by Landlord, in operating, managing, policing, insuring, replacing, repairing and maintaining the Common Area and, if applicable, the security offices and management offices, located in the Entire Premises from time to time (the “Common Facilities”), and operating, insuring, repairing, replacing and maintaining the Common Utility Facilities. “Common Utility Facilities” arc defined to include but are not limited to, sanitary sewer lines and systems, gas lines and systems, water lines and systems, fire protection lines and systems, electric power, telephone and communication lines and systems, and storm drainage and retention facilities not exclusively serving the premises of any tenant or store located in the Entire Premises. Common Area Expenses shall include, without limitation, the following: expenses for maintenance, landscaping, repaying, resurfacing, repairs, replacements, painting, lighting, cleaning, trash removal, security, fire protection and similar items; cost, installation and removal of seasonal decorations; non-refundable contributions toward one or more reserves for replacements other than equipment; rental on equipment; charges, surcharges and other levies related to the requirements of any Federal, State or local governmental agency; costs of any improvements made by Landlord to the Entire Premises for the purpose of reducing recurring expenses or utility costs and from which Tenant can expect a reasonable benefit or that are required by any governmental law, ordinance, regulation or mandate subsequent to the original

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construction of the Entire Premises; expenses related to the Common Utility Facilities; real and personal property taxes and assessments on the improvements and land comprising the Common Area and Common Facilities; Landlord Carried Insurance (defined in Section 16.02) and any additional coverage obtained by Landlord on the Entire Premises; and a sum payable to Landlord for administration and overhead in an amount equal to ten percent (10%) of the Common Area Expenses for the applicable year.
      Section 12.05. Proration of Common Area Expenses.
          (a) From and after the commencement of the Term, Tenant shall pay to Landlord, on the first day of each calendar month, without demand or offset, an amount estimated by Landlord to be the monthly amount of Tenant’s share of the Common Area Expenses which shall also include Tenant’s pro rata share of Real Property Taxes described in Section 8.01 (“Monthly Impound”). The Monthly Impound may be adjusted periodically by Landlord based on Landlord’s reasonable estimate of anticipated costs.
          (b) Within one hundred twenty (120) days following the end of each calendar year of the Term, or, at Landlord’s option, its fiscal year, Landlord shall furnish Tenant with a statement covering the calendar or fiscal year (as the case may be) just expired, showing the actual Common Area Expenses for that year, the amount of Tenant’s share of Common Area Expenses for said calendar or fiscal year and the Monthly Impound payments made by Tenant during that year. If Tenant’s share of the Common Area Expenses exceeds Tenant’s prior Monthly Impound payments, Tenant shall pay Landlord the deficiency within ten (10) days after receipt of the annual statement. If Tenant’s Monthly Impound payments for the calendar or fiscal year exceed Tenant’s actual share of Common Area Expenses, and provided Tenant is not in arrears as to the payment of any Rent, Tenant may offset the excess against the next Monthly Impound due Landlord.
          (c) Tenant’s proportionate share of the Common Area Expenses shall be determined by multiplying the amount of such expenses by a fraction, the numerator of which is the number of square feet of leasable floor area in the Premises and the denominator of which is the number of square feet of leasable floor area in the Entire Premises.
      Section 12.06. Parking
     Tenant and its employees shall park their vehicles only in those portions of the Common Area from time to time designated for such purpose by Landlord. Landlord, at Tenant’s expense, shall have the right to tow improperly parked vehicles of Tenant or Tenant’s employees. Tenant shall reimburse Landlord upon demand for any such towing costs. Landlord shall have the right to adopt and implement such parking programs as may be necessary to alleviate parking problems during the peak traffic periods, including requiring the use of off-site parking. Tenant shall pay to Landlord its proportionate share of the cost of any such off-site parking program based on the ratio of the floor area of the Premises to the total floor area of the premises of all tenants in the Entire Premises required to participate in such program.
     Tenant shall furnish Landlord with a list of its employees and the license numbers of their vehicles within fifteen (15) days after Tenant opens for business in the Premises. Tenant shall be responsible for ensuring that its employees comply with all the provisions of this Section 12.06 and such other parking rules and regulations as may be adopted and implemented by Landlord from time to time, including but not limited to systems of validation, shuttle transportation or any other programs which may be deemed necessary or appropriate by Landlord to control, regulate or assist parking by customers of the Entire Premises.
ARTICLE XIII
UTILITIES
      Section 13.01. Utility Charges.
     Tenant shall be solely responsible for and shall promptly pay all charges for heat, water, gas, electricity, fire sprinkler, fire alarm or any other utility used, consumed or provided in, or furnished, or attributable to the Premises at the rates charged by the supplying utility companies. Should Landlord elect to supply any or all of such utilities, Tenant agrees to purchase and pay for the same as additional rent as apportioned by the Landlord. The rate to be charged by Landlord to Tenant shall not exceed the rate charged Landlord by any supplying utility plus any expenses incurred by Landlord in connection with billing and supplying such utility service to Tenant. In no event shall Landlord be liable for any interruption or failure in the supply of any such utilities to the Premises. Tenant agrees to reimburse Landlord within ten (10) days of billing for fixture charges and/or water tariffs, if applicable, which are charged by local utility companies. Landlord will notify Tenant of this charge as soon as it becomes known. This charge will increase or decrease with current charges being charged Landlord by the local utility company, and will be due as additional rent. Tenant shall be responsible for sewer hook-up fees associated with Tenant’s use of the Premises other than the fees for a standard retail shell.
ARTICLE XIV
ALTERATIONS AND SIGNS
      Section 14.01. Installation.
     Tenant shall not make or cause to be made any alterations, additions or improvements or install or cause to be installed any trade fixtures, exterior signs, floor covering, interior lighting, plumbing fixtures, shades or awnings or make any changes to the storefront of the Premises without Landlord’s prior written consent. Concurrently with the request for approval, Tenant shall deliver to Landlord two (2) sets of complete plans and specifications for such work prepared by a licensed architect and if applicable, engineer. If required by Landlord, Tenant shall also provide security for the lien free completion of such work in the form of a payment and performance bond or other security satisfactory to Landlord.

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      Section 14.02. Removal by Tenant.
     All alterations, decorations, additions and improvements made by the Tenant, or made by the Landlord on the Tenant’s behalf by agreement under this Lease, shall remain the property of the Tenant for the Term, or any extension or renewal thereof. Any alterations, decorations, additions and improvements made by Tenant or previous tenant, if applicable, shall not be removed from the Premises without Landlord’s prior written consent. During the Term, Tenant shall not remove any of its trade fixtures or other personal property, without the immediate replacement thereof with comparable fixtures or property. Upon expiration of this Lease, or any renewal term thereof, at Landlord’s option, Tenant shall remove all such alterations, decorations, additions, and improvements, and restore the Premises as provided in Section 15.01 hereof. If the Tenant fails to remove such alterations, decorations, additions and improvements and restore the Premises, then upon the expiration of this Lease, and upon Tenant’s vacation of the Premises, all such alterations, decorations, additions and improvements shall become the property of Landlord and Tenant shall reimburse Landlord for the cost of removal and/or storage of such alterations, decorations, additions and improvements.
      Section 14.03. Liens.
     Tenant shall keep the Premises free from any kinds of liens arising out of work performed or materials furnished Tenant and shall promptly pay all contractors and materialmen used by Tenant to improve the Premises, so as to minimize the possibility of a lien attaching thereto. If any such lien be made or filed, Tenant shall bond against or discharge the same within ten (10) days after written request by Landlord.
     Tenant shall indemnify, defend, protect and hold Landlord, any ground lessor, the Premises and the Entire Premises and every part thereof free and harmless from and against any and all liability, damage, claims, demands, suits, actions or expense (including attorneys’ fees) arising out of any work done on or about the Premises by Tenant or, at Tenant’s direction, including Tenant’s employees, representatives, successors, contractors, subcontractors, materialmen and assigns.
      Section 14.04. Signs, Awnings and Canopies.
     Tenant shall conform to the Century Stadium Promenade Tenant Sign Criteria as set forth in Exhibit B. In addition, Tenant shall not place or suffer to be placed or maintained any sign, awning, canopy, or advertising matter on the roof or on any exterior surface, door, wall or window or within 48 inches of any windows or doors of the Premises or the Building without Landlord’s prior written consent. If Landlord consents, Tenant agrees to maintain such sign, awning, canopy, decoration, lettering or advertising matter in good condition and repair at all times.
     Tenant agrees, at Tenant’s sole cost any signs as required by Landlord in strict conformance with Landlord’s sign criteria as to design, material, color, location, size and letter style and, if requested by Landlord, from the source designated by Landlord. Tenant’s sign shall be installed prior to Tenant’s opening for business and shall thereafter be maintained by Tenant at its own expense. If Tenant fails to maintain such sign, Landlord may do so and Tenant shall reimburse Landlord for such cost plus a twenty percent (20%) overhead fee. If, without Landlord’s prior written consent, Tenant installs a sign that does not conform to the Sign Criteria, Landlord may have Tenant’s sign removed and stored at Tenant’s expense. The removal and storage costs shall bear interest until paid at the maximum rate allowed by law.
     Landlord reserves the right to revise the Sign Criteria, at any time. Within ninety (90) days of Landlord’s request and provided that Tenant has been in occupancy of the Premises for at least five (5) years, Tenant shall remove Tenant’s existing sign, patch the fascia, and install a new sign, at Tenant’s sole cost and expense, in accordance with Landlord’s new sign criteria.
ARTICLE XV
SURRENDER OF PREMISES
      Section 15.01. Surrender of Premises.
     At the expiration of the tenancy hereby created, Tenant shall surrender the Premises in a first class, clean condition in accordance with the requirements of Section 14.02 herein, except for reasonable wear and tear and damage by unavoidable casualty to the extent covered by Landlord Carried Insurance. Tenant shall remove all of its trade fixtures, and any alterations or improvements if required as provided in Section 14.02 hereof, before surrendering the Premises to Landlord and shall repair any damage to the Premises or Building caused thereby. Tenant shall also remove its sign and patch the fascia. Tenant’s covenants shall survive the expiration or other termination of this Lease.
     If the Premises were occupied by other tenants prior to the commencement of the Term, then Tenant, upon Landlord’s written request at the expiration of the Term, shall remove all or a portion of, as designated by Landlord, the interior improvements made by the prior tenants, and deliver the Premises in a condition acceptable to Landlord.
     Following removal of all improvements as required by Section 15.01, Landlord shall conduct an inspection of the Premises to confirm Tenant’s compliance with this Section. Tenant shall send written notice to Landlord five days prior to Landlord’s inspection. Landlord’s inspection shall occur no later than the last day of the Term. During the inspection, Tenant shall surrender all keys for the Premises to Landlord and shall inform Landlord of all combinations on locks, safes and vaults, if any, in the Premises.
     Tenant shall also provide Landlord with a written statement, at Tenant’s sole expense, from a reputable company licensed and experienced in HVAC repair and maintenance approved by Landlord that certifies that the

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HVAC equipment serving the Premises was inspected and serviced, if necessary, within the last thirty (30) days of the Term and is in good working order. If Tenant fails to provide the statement, Landlord may order an inspection of the HVAC at Tenant’s expense.
ARTICLE XVI
INSURANCE AND INDEMNITY
      Section 16.01. Tenant’s Liability and Property Insurance.
     During the Term, Tenant, at its expense, shall keep in full force and effect a policy of commercial general liability insurance insuring Landlord and Tenant from and against all claims, demands, actions or liability for injury to or death of any persons, and for damage to property arising from or related to the use or occupancy of the Premises or the operation of Tenant’s business and the business operated by Tenant and subtenants and concessionaires of Tenant in the Premises. No deductible will be carried under this coverage without the prior written consent of Landlord. The policy shall include coverage for property damage, bodily injury, premises/operations, contractual liability (including Tenant’s indemnity under this Lease), independent contractors, personal injury, product/completed operations, owned and nonowned automobiles, and, if applicable, liquor liability insurance. If required by Landlord, Tenant must carry building ordinance coverage. The insurance shall be written on an occurrence basis with coverage in a minimum amount of $1,000,000.00 per occurrence for bodily injury/property damage and $2,000,000.00 general aggregate limit. Tenant shall also maintain in full force and effect insurance covering all trade fixtures, merchandise, personal property, equipment and Tenant Improvements other than improvements paid by Landlord, in amounts no less than one hundred percent (100%) of the replacement value thereof, providing protection against any peril included within the classification of the “Fire and Extended Coverage”, including sprinkler damage, vandalism and malicious mischief. Tenant shall also maintain Worker’s Compensation Insurance with a limit no less than the amount required by law.
     During any construction on the Premises, Tenant shall cause its contractor to obtain a policy of general liability insurance in the same form as required of Tenant, a policy of builder’s risk insurance providing coverage for the expected value of Tenant’s Work when completed and Worker’s Compensation as required by law.
     All policies shall name Landlord, property manager, Landlord’s lender and any person, firms or corporations designated by Landlord as additional insures. No additional insured shall be liable for any payment for premiums. All additional insures shall be entitled to recovery for any loss occasioned to them, their servants, agents or employees by reason of negligence of Tenant, its officers, agents or employees. All policies shall contain a clause that the insurer will not cancel or change such coverage without first giving Landlord thirty (30) days prior written notice. All insurance shall be issued by an insurance company qualified to do business in the State in which the Entire Premises is located and having an overall rating of Class A- or better and a financial rating of Class V as rated in the most current available Best’s Key Rating Guide. Copies of all policies or certificates of insurance required hereunder shall be delivered to Landlord as a condition to Tenant’s entry onto the Premises. All policies shall be written as primary policies, not contributing with and not in excess of coverage which Landlord may carry. Landlord may increase the limits of liability required hereunder in the exercise of Landlord’s reasonable judgment.
     If this Lease is canceled by reason of damage or destruction and Tenant is relieved of its obligation to rebuild, any insurance proceeds for damages to the Premises, including all leasehold improvements, but excluding all fixtures, will belong to Landlord, free and clear of any claims by Tenant.
      Section 16.02 Landlord’s Acquisition of Insurance.
     If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord.
      Section 16.03. Landlord Carried Insurance.
Landlord shall, subject to reimbursement as provided herein, maintain public liability, fire with extended coverage insurance with a vandalism and malicious mischief endorsement, rental loss insurance, earthquake (if not otherwise economically impractiable) or any other insurance coverage deemed necessary by Landlord or Landlord’s lender (collectively, “Landlord Carried Insurance”) through the Term, in amounts from time to time deemed reasonably necessary by Landlord or Landlord’s lender on the Common Area. The Landlord Carried Insurance may be obtained through a blanket policy or other form of pooled insurance coverage covering not only the Entire Premises, but other property owned by Landlord or its affiliates. The fire and extended coverage insurance shall be in an amount equal to at least ninety percent (90%) of the replacement value of the Building and Improvements paid for by Landlord as set forth in Section 5.01(c). During the Term, Tenant hereby agrees to reimburse Landlord as part of the Common Area Expenses for Tenant’s pro rata share of any Landlord Carried Insurance attributable to the Common Area and to reimburse Landlord for Landlord Carried Insurance attributable to the Tenant’s Building and Improvements. In determining Tenant’s share of the premiums for Landlord Carried Insurance, the schedule issued by the organization making the insurance rate on the improvements, areas and/or risks covered, showing the various components of such rates, shall be conclusive evidence of the charges which make up the insurance rate and the share to be charged to the Premises. If such a schedule cannot be obtained, then Tenant’s share shall be a proportion of the premiums for such Landlord Carried Insurance based on the ratio of the square footage of the floor area of the Premises to the total square footage of the floor area of all builing space covered by such Landlord Carried Insurance.
      Section 16.04. Indemnification of Landlord.

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     Tenant shall indemnify, defend, protect and save Landlord harmless from and against any and all claims, demands, actions, damages, liability and expense (including reasonable attorneys’ fees and costs of investigation) in connection with any damage to person and/or property arising directly or indirectly from or connected with the conduct or management of the business conducted by Tenant on the Premises, or the occupancy or use by Tenant of the Premises or any part of the Entire Premises, or from any’ breach or default on the part of Tenant in the performance of any covenant or agreement on the part of Tenant to be performed pursuant to this Lease, or from violations of or noncompliance with any governmental requirements or insurance requirements, or from any acts or omissions of Tenant or any person on the Premises by license or invitations of Tenant or occupying the Premises or any part thereof under Tenant whether such damage occurs in, on or about the Premises, the Common Area or the Entire Premises. In case Laudlord shall be made a party to any litigation commenced by or against Tenant, Tenant shall accept any tender of defense by Landlord and shall, notwithstanding any allegations of negligence or misconduct on the part of Landlord, its agents or employees, defend, protect and hold Landlord harmless and pay all costs, expenses and reasonable attorneys’ fees incurred or paid by Landlord in connection with such litigation; provided, however, Tenant shall not be liable for any such damage to the extent and in the proportion such damage is ultimately determined to be attributable to the gross negligence or willful misconduct of Landlord, its agents or employees, unless covered by insurance required to be carried by Tenant. Landlord may, at its option, require Tenant to assume Landlord’s defense in any action covered by this Section 16.03 through counsel satisfactory to Landlord.
     Landlord shall, during the Term hereof, indemnify Tenant and save it harmless from and against any and all claims, demands, actions, damages, liability and expense arising solely out of the gross negligence or willful misconduct of the Landlord; providing, howevcr, in no event shall Landlord be liable to Tenant for any consequential damages, including, without limitation, any claimed loss of profit or business.
      Section 16.05. Boiler, HVAC and Evaporative Cooler Insurance.
     If required by Landlord, Tenant, at its sole expense, shall procure and maintain in full force and effect for the Term, boiler and machinery insurance on all air-conditioning equipment, evaporative coolers, boilers, and other pressure vessels and systems, whether fired or unfired, located in the Premises. If said objects and the damage that may be caused by them or result from them are not covered by Tenant’s extended coverage insurance required pursuant to Section 16.01, then such boiler insurance shall be in an amount satisfactory to Landlord and equal to one hundred percent (100%) of the replacement value of such equipment.
      Section 16.06. Waiver of Subrogation.
     Landlord and Tenant hereby mutually waive their respective rights of recovery, against each other for any loss to the Premises or its contents resulting from actions on or with respect to the Premises insured by fire, extended coverage or any other insurance existing for the benefit of the respective parties and each party agrees to apply to their insurers to obtain similar waivers from such insurers. Each party shall obtain any special endorsements required by such party’s insurer to evidence compliance with the aforementioned waiver.
      Section 16.07. Waiver or Loss and Damage.
     Landlord shall not be liable for any damage to property of Tenant, or of others, located in, on or about the Premises, nor for the loss of or damage to any property of Tenant or of others by theft or otherwise. Landlord shall not be liable to Tenant, Tenant’s employees or representatives for any injury or damage to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, rain or leaks from any part of the Premises or from the pipes, appliances or plumbing works or from the roof, street or sub-surface or from any other places or by dampness or by any other cause of whatsoever nature. Landlord shall not be liable to Tenant, Tenant’s employees or representatives for any such damage caused by other tenants or persons in the Premises, occupants of adjacent property of the Entire Premises, or the public, or caused by operations in construction of any private, public or quasi-public work. Landlord shall not be liable for any latent defects in the Premises or in the Building except for a period of one (1) year from the date of original completion of the Building by Landlord’s contractor. All property of Tenant kept or stored on the Premises shall be so kept or stored at the sole risk of Tenant and Tenant shall hold Landlord harmless from any claims arising out of damage to the same, including subrogation claims by Tenant’s insurance carriers, unless such damage shall be caused by the willful act or gross negligence of Landlord. Landlord shall not be liable in any circumstances for any consequential damages of any kind or nature whatsoever, including, without limitation, any claimed loss of profit or business.
      Section 16.08. Notice by Tenant.
     Tenant shall give immediate notice to Landlord in case of fire or accidents in the Premises or in the Building or of any damage or defects in the Premises, the Building or any fixtures or equipment therein.
ARTICLE XVII
ESTOPPEL CERTIFICATE, ATTORNMENT, SUBORDINATION,
MORTGAGEE PROTECTION CLAUSE
      Section 17.01. Estoppel Certificate.
     Within five (5) days after Landlord’s written request, Tenant agrees to deliver in recordable form a certificate to any proposed mortgagee, ground lessor or purchaser, or to Landlord, certifying that this Lease is in full force and effect, that there does not exist nor has there existed any toxic materials or hazardous waste in, on or about the Premises, that no more than one (1) month’s rent has been paid in advance, the essential terms of the Lease, that there are no defenses or offsets thereto, or stating those claimed by Tenant, and any other information that may be requested.
      Section 17.02. Attornment.

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     Tenant shall, in the event any proceedings are brought for the foreclosure of, or in the event of exercise of the power of sale under any mortgage made by the Landlord covering the Premises, or in the event of a termination of any ground lease covering the Building or Premises, attorn to the purchaser or ground lessor upon any such foreclosure or sale or termination of ground lease and recognize such purchaser or ground lessor as the Landlord under this Lease, provided that any purchaser or mortgage or ground lessor shall recognize this Lease as remaining in full force and effect so long as Tenant is not in default hereunder.
      Section 17.03. Subordination.
     Upon the written request of Landlord, and provided such mortgagee or ground lessor confirms in writing the nondisturbance provisions of Section 17.02 above, Tenant will immediately subordinate its rights hereunder to the lien of any mortgage or mortgages or the lien resulting from any other method of financing or refinancing, or any ground lease now or hereafter in force covering the land and the Building or upon any buildings hereafter placed upon the land of which the Premises are a part, and to all advances made or hereunder to be made upon the security thereof. This Section 17.03 shall be self-operative and no further instrument or subordination shall be required unless requested by Landlord’s mortgagee or ground lessor. Tenant covenants and agrees that it will execute subordination agreements at any time upon Landlord’s written request without compensation being made therefor. However, if Landlord so elects, this Lease shall be deemed prior in lien to any mortgage, deed of trust or other encumbrances or ground lease upon or including the Premises, regardless of recording and Tenant will execute a statement in writing to such effect at Landlord’s request.
      Section 17.04. Mortgagee Protection Clause.
     Tenant agrees to give any mortgagees, trust deed holders and/or ground lessor, by registered mail, a copy of any notice of default served upon the Landlord, provided that prior to such notice Tenant has been notified in writing (by way of notice of assignment of lease, or otherwise) of the addresses of such mortgagees, trust deed holders and/or ground lessor. Tenant further agrees that if Landlord shall have failed to cure such default within the time provided for in this Lease, then the mortgagees and/or trust deed holders shall have an additional thirty (30) days within which to cure such default, or if such default cannot be cured within that time, then such additional time as may be necessary, provided such mortgagees, trust deed holders and/or ground lessor commence such cure within thirty (30) days and diligently pursue the remedies necessary to cure such default (including but not limited to commencement of foreclosure proceedings to effect such cure), in which event this Lease shall not be terminated while such remedies are being so diligently pursued.
      Section 17.05. Landlord Waiver Form.
     Upon request by Tenant, Landlord shall execute an Landlord’s waiver and consent to financing for Tenant’s fixturization on the Premises in a form to be supplied by Landlord. Tenant shall pay Landlord $150.00 (increased by the Index) for each form signed by Landlord.
ARTICLE XVIII
ASSIGNMENT AND SUBLETTING
      Section 18.01. Consent Required.
     Except as provided in Sections 18.02, 18.03 and 18.04 herein, Tenant shall not assign this Lease in whole or in part, nor sublet all or any part of the Premises, without the prior written consent of Landlord, which consent shall not be unreasonably withheld. It is agreed that Landlord will not be acting unreasonably in refusing to consent to an assignment or sublease if, in Landlord’s reasonable business judgment, the quality of the merchandising operation of the proposed assignee or subtenant is not equal to that of the Tenant, the use of the Premises will change, such assignee or subtenant may adversely affect the business of other tenants or the tenant mix in the Entire Premises or Landlord’s ability to obtain percentage rent, the net worth of such assignee or subtenant is less than that of Tenant at time of execution of this Lease, or the proposed assignee or subtenant lacks sufficient working capital to operate the business. The consent by Landlord to any assignment or subletting shall not constitute a waiver of the necessity for such consent to any subsequent assignment or subletting. If this Lease is assigned by Tenant, or if the Premises or any part thereof are sublet or occupied by any person or entity other than Tenant, Landlord may collect Rent from the assignee, subtenant or occupant, and apply the net amount collected to the Rent herein reserved, not no such assignment, subletting, occupancy or collection shall be deemed a waiver on the part of Landlord, or the acceptance of the assignee, subtenant or occupant as tenant, or a release of Tenant from the further performance by Tenant of covenants on the part of Tenant herein contained. Irrespective of any assignment or sublease, Tenant shall remain fully liable under this Lease and shall not be released from performing any of the terms, covenants and conditions of this Lease. If Tenant assigns this Lease or sublets the Premises, any rent paid to Tenant in addition to the Rent payable to Landlord as set forth in this Lease shall be paid be paid by Tenant to Landlord as additional rent.
     If Tenant is a corporation, an unincorporated association or a partnership, the transfer, assignment or hypothecation of any stock or interest in such corporation, association or partnership in the aggregate in excess of forty-nine percent (49%) shall be deemed an assignment within the meaning and provisions of this Section 18.01.
     Tenant shall pay Landlord a non-refundable processing fee of $50.00 (increased each year by the Index) for each requested assignment or sublease to cover Landlord’s costs. This fee shall accompany any request for assignment or sublease. In addition, Tenant shall pay all costs incurred by Landlord in connection with reviewing a request to consent to an assignment or sublease, including all of Landlord’s attorneys’ and accountants’ fees.
      Section 18.02. Permitted Assignment or Subletting by Franchisor.

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     If Tenant is a franchisor, Tenant may assign its interest herein or sublet all or part of the Premises once to a bona fide franchisee or licensee of Tenant without the payment of the fee described in Section 18.01 (but subject to all other conditions contained therein), provided there shall be no change in the use of the Premises, provided Tenant notifies Landlord in writing thirty (30) days prior to such subletting or assignment and provided further such assignee or subtenant meets all of Tenant’s then nationwide franchise requirements including payment of the applicable standard franchise fee. Any subsequent subletting or assignment shall be subject to all the conditions of Section 18.01, including the payment of the fee.
      Section 18.03. Concessionaires.
     Tenant may grant concessions for the operation of one or more departments of the business which Tenant operates on the Premises as required by Section 10.01; provided however that (a) each such concession may be allowed only upon receipt by Tenant of the prior written consent of the Landlord, which consent shall not be unreasonably withheld, and shall be subject to all the terms and provisions of this Lease; (b) the Gross Receipts, as defined in Section 4.04 hereof, from the operation of each such concession shall be deemed to be a part of the Gross Receipts of Tenant for the purpose of determining the Percentage Rent payable to Landlord; (c) all of the provisions hereof applying to the business of Tenant including the provisions concerning reports and audits shall apply to each such concession; and (d) at least seventy-five percent (75%) of the sales floor area of the Premises shall at all times be devoted solely to the business operated by Tenant.
      Section 18.04. Involuntary Assignment.
     No interest of Tenant in this Lease shall be assignable by operation of law (including, without limitation, the transfer of this Lease by testacy or intestacy). Each of the following acts shall be considered an involuntary assignment: (a) if Tenant is or becomes bankrupt or insolvent, makes an assignment for the benefit of creditors, or institutes a proceeding under the Bankruptcy Act in which Tenant is bankrupt; or, if Tenant is a partnership or consists of more than one person or entity, if any partner of the partnership or other person or entity is or becomes bankrupt or insolvent, or makes an assignment for the benefit of creditors; (b) if a writ of attachment or execution is levied on this Lease; or (c) if, in any proceeding or action to which Tenant is a party, a receiver is appointed with authority to take possession of the Premises. An involuntary assignment shall constitute a default by Tenant, and Landlord shall have the right to elect to terminate this Lease, in which case this Lease shall not be treated as an asset of Tenant.
ARTICLE XIX
ADVERTISING AND PROMOTION FUND
      Section 19.01. Advertising and Promotion Fund.
     Landlord may, from time to time, establish an advertising and promotion service designed to furnish and maintain professional advertising and sales promotions for the benefit of all tenants in the Entire Premises. In conjunction therewith, Landlord may establish a separate fund to be known as the Promotion Fund, the proceeds of which are to be expended solely for advertising, promotion, public relations designed to promote the Entire Premises and administrative expenses, at such times and in such manner as shall be determined by Landlord.
     Tenant shall not be obligated to make payments into the Promotion Fund; however, Tenant agrees that it will conduct an annual advertising and promotional campaign of not less than $200,000 per year.
     Should Landlord elect to have a “Grand Opening” promotion, in addition to the above, Tenant agrees to pay to Landlord, within thirty (30) days of Landlord’s billing, as its pre-opening contribution, the sum set forth in Section 1.12 herein which is Tenant’s share, of Landlord’s budget for funds to be expended for promotion and advertising of the Entire Premises.
     Any balance remaining in the Promotion Fund at the end of any calendar year shall be carried forward to the next calendar year to be used as provided herein.
     An Advertising and Promotion Service Committee composed of a representative of Landlord, a representative of each store exceeding a size of 25,000 square feet of floor area in the Entire Premises, and two (2) representatives of the other tenants in the Entire Premises may be formed to review all of the advertising activities.
      Section 19.02. Advertising of Tenant.
     With the exception of national or regional advertising, Tenant, at its sole expense, agrees to refer to the Entire Premises by the name provided in Section 1.02.1, if one is so provided, in designating the location of the Premises in all local newspapers or other advertising, stationery, other printed material and in all other references to location, and to include the address and identity of its business activity in the Premises in all advertisements made by Tenant for its operation at the Entire Premises.

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ARTICLE XX
DESTRUCTION OF PREMISES
      Section 20.01. Total or Partial Destruction.
     If the Premises shall be damaged by fire, the elements or other casualty or cause whether or not insured against under the provisions of Section 16.01 and 16.03, Tenant at its own expense, shall cause such damage to be repaired and the Premises reconstructed and restored as soon as reasonably practical, and any Rent or other charges payable hereunder shall not be abated. Landlord shall make any insurance proceeds available to Tenant on a reasonable basis for that purpose. Tenant shall be responsible for the concurrent prompt repair and restoration of its furniture, fixtures and equipment in the Premises damaged by such event. In the event that fifty percent (50%) or more of the Premises are damaged or destroyed by fire, the elements or other cause or casualty, Landlord shall have the right, to be exercised by written notice delivered to Tenant within sixty (60) days from and after said occurrence, to elect not to require the Tenant to reconstruct and repair the Premises, and in such event this Lease and the tenancy hereby created shall cease as of the date of said damage. If Landlord electes to terminate this Lease in accordance with this Section 20.01, all insurance proceeds, except for insurance proceeds for Tenant’s fixtures, shall become the property of Landlord.
      Section 20.02. Waiver of Termination.
     Tenant hereby waives any statutory rights which it may have to terminate the Lease in the event of the partial or total destruction of the Premises, if being agreed that the provisions of this Article XX shall control.
ARTICLE XXI
EMINENT DOMAIN
      Section 21.01. Total Condemnation.
     If the whole of the Premises shall be acquired for any public or quasi-public use or purpose or taken by eminent domain, then the Term shall cease and terminate as of the date possession or title is given to such condemning authority in such proceeding and all rentals shall be paid up to that date.
      Section 21.02. Total Parking Area.
     If the entire portion of the Common Area used for parking in the Entire Premises (“Parking Area”) shall be acquired for any public or quasi-public use or purpose or taken by eminent domain, then the Term shall cease and terminate as of the date possession or title is given to such condemning authority in such proceeding unless Landlord shall provide other parking facilities substantially equal to the previously existing ratio between the Parking Area and the Premises within ninety (90) days from the date of such taking. In the event that Landlord shall provide such other parking facilities, then this Lease shall continue in full force and effect without abatement of Rent or other charges.
      Section 21.03. Partial Condemnation.
     If any part of the Premises shall be acquired or taken by eminent domain for any public or quasi-public use or purpose, and in the event that such partial taking or condemnation shall render the Premises, in Landlord’s discretion, unsuitable for the operation of Tenant’s business, then the Lease shall cease and terminate as of the date possession or title is given to such condemning authority is such proceeding. In the event of a partial taking or condemnation which is not extensive enough to render the Premises unsuitable for the operation of Tenant’s business, then Landlord shall promptly restore the Premises to the extent of the condemnation proceeds to a condition comparable to its condition at the time of such condemnation less the portion lost in the taking, and this Lease shall continue in full force and effect and the Minimum Rent shall be equitably reduced based on the percentage of floor area of the Premises lost in the taking.
      Section 21.04. Partial Condemnation of Parking Area.
     If any part of the Parking Area shall be acquired or condemned by eminent domain for any public or quasi-public use or purpose and if, as the result of such partial taking the ratio of square feet of Parking Area to square feet of the sales floor area of the Entire Premises is reduced to a ratio below that permitted by law, then the Lease shall cease and terminate from the date possession or title is given to such condemning authority in such proceeding, unless Landlord shall provide reasonable evidence of its ability to increase the parking ratio to a permitted ratio or Landlord can provide substitute parking either in or outside the Entire Premises, in which event this Lease shall be unaffected and remain in full force and effect as between the parties.
      Section 21.05. Allocation of Award.
     Except as provided below, in the event of any condemnation or taking as herein provided, whether whole or partial, Tenant shall not be entitled to any part of the award, as damages or otherwise, for such condemnation and Landlord is to receive the full amount of such award; Tenant expressly waives any right or claim to any part thereof, including the right or claim for the value of the unexpired portion of the Term or diminution in value of Tenant’s leasehold interest, or for the value of any option to extend the Term or renew this Lease. Tenant shall, however, have the right, provided such award shall not diminish Landlord’s award, to claim and recover from the condemning authority, but not from Landlord, such compensation as may be separately awarded or recoverable by Tenant in Tenant’s own right on account of any and all damages to Tenant’s business for Goodwill and loss of income by reason of the condemnation and for or on account of any cost or less to which Tenant might incur in removing Tenant’s merchandise, future, fixtures and equipment from the Premises.

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ARTICLE XXII
DEFAULT
      Section 22.01. Tenant’s Default.
     The occurrence of any of the following shall constitute a default by Tenant: (a) failure to pay rent when due, if the failure continues for three (3) days after notice has been given to Tenant; (b) abandonment and/or vacation of the Premises; (c) failure to operate in the Premises for ten (!0) consecutive days; (d) failure to perform any nonmonetary provision of this Lease if the failure to perform is not cured within thirty (30) days after notice has bcen given to Tenant; provided that if the nonmonetary default cannot reasonably be cured within thirty (30) days, Tenant shall not be default of this Lease if Tenant commences to cure the default within the thirty (30) day period and diligently and in good faith continues to cure the default; and (e) failure to timely deliver an estoppel certificate as required by Section 17.01.
     Notices given under this Section 22.01 shall not be deemed a forfeiture or a termination of this Lease unless Landlord so elects in the notice. Notices given under this Section 22.01 shall be in lieu of and not in addition to any statutory notice required by law.
      Section 22.02. Landlord’s Remedies.
     Landlord shall have the following remedies if Tenant commits a default. These remedies are not exclusive; they are cumulative in addition to any remedies now or later allowed by law.
     Landlord can continue this Lease in full force and effect after Tenant’s default and abandonment, and the Lease will continue in effect as long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all Landlord’s rights and remedies under the Lease, including the right to collect Rent when due. During the period Tenant is in default, Landlord can enter the Premises and relet them, or any part of them, to third parties for Tenant’s account. Tenant shall be liable immediately to Landlord for all costs Landlord incurs in reletting the Premises, including, without limitation, brokers’ commissions, expenses of remodeling the Premises required by the reletting, and like costs. Reletting can be for a period shorter or longer than the remaining Term of this Lease. Tenant shall pay to Landlord the Rent due under this Lease on the dates the Rent is due, less the rent Landlord receives from any reletting. No act allowed by this Section 22.02 shall terminate this Lease unless Landlord notifies Tenant that Landlord elects to terminate this Lease.
     If Landlord elects to relet the Premises as provided in this Section 22.02, Rent that Landlord receives from reletting shall be applied to the payment of: first, any indebtedness from Tenant to Landlord other than Rent due from Tenant; second, all costs, including maintenance, incurred by Landlord in reletting; and third, Rent due and unpaid under this Lease. After deducting the payments referred to in this Section, any sum remaining from the Rent Landlord receives from reletting shall be held by Landlord and applied in payment of future Rent as Rent becomes due under this Lease. In no event shall Tenant be entitled to any excess Rent received by Landlord. If, on the date Rent is due under this Lease, the Rent received from the reletting is less than the Rent due on that date, Tenant shall pay to Landlord, in addition to the remaining Rent due, all costs, including maintenance, Landlord incurred in reletting that remain after applying the Rent received from the reletting as provided in this Section 22.02.
     Landlord can terminate Tenant’s right to possession of the Premises at any time. No act by Landlord other than giving notice to Tenant shall terminate this Lease. Acts of maintenance, efforts to relet the Premises or the appointment of a receiver on Landlord’s initiative to protect Landlord’s interest under this Lease shall not constitute a termination of Tenant’s right to possession. On termination, Landlord has the right to recover from Tenant: (a) the worth, at the time of the award, of the unpaid rent that had been earned at the time of termination of this Lease; (b) the worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and (d) any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s default. “The worth, at the time of the award”, as used in (a) and (b) of this Section 22.02, is to be computed by allowing interest at the maximum rate an individual is permitted by law to charge. “The worth, at the time of the award,” as referred to in (c) of this Section 22.02, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
      Section 22.03. Appointment of Receiver.
     If Tenant is in default of this Lease, Landlord shall have the right to have a receiver appointed to collect Rent and conduct Tenant’s business. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this lease.
      Section 22.04. Landlord’s Right to Cure Tenant’s Default.
     Landlord, at any time after Tenant commits a default, can cure the default at Tenant’s cost. If Landlord at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord at the time the sum is paid, and if paid at a later date shall bear interest at the maximum rate an individual is permitted by law to charge from the date the sum is paid by Landlord until Landlord is reimbursed by Tenant. The sum, together with interest on it, shall be additional rent.
      Section 22.05. Waiver of Rights of Redemption.
     Tenant expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being evicted or dispossessed for any cause, or in the event of Landlord obtaining possession
7/18/97

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of the Premises, by reason of the violation by Tenant of any of the covenants or conditions of this Lease, or otherwise.
      Section 22.06. Default by Landlord.
     If Landlord fails to perform any of the covenants or conditions required on its part to be performed pursuant to this Lease, where such failure continues for a period of thirty (30) days after receipt of written notice specifying the nature and extent of such default in detail (provided, however, that if such default is of a nature that it cannot reasonably be cured within thirty (30) day period). Landlord shall be liable to Tenant for all damages sustained as a direct result of such breach, subject to the additional rights of any mortgagees of Landlord as provided in Section 17.04 herein. Landlord’s liability shall be limited to Landlord’s interest in the Entire Premises. Neither Landlord nor any of its partners shall be personally liable.
ARTICLE XXIII
SUCCESSORS; SALE OF PREMISES
      Section 23.01. Successors and Assigns.
     Except as provided in Section 18.05, all rights and liabilities herein given to, or imposed upon, the respective parties hereto shall extend to and bind the several respective heirs, executors, administrators, successors, and assigns of said parties; and if there shall be more than one tenant, they shall all be bound jointly and severally by the terms, covenants and agreements herein. No rights, however, shall inure to the benefit of any assignee of Tenant unless the assignment to such assignee has been approved by Landlord in writing as provided in Section 18.01 hereof.
      Section 23.02. Sale of Premises.
     In the event Landlord shall sell, convey, transfer or exchange the Premises, thc Entire Premises or the Building, Tenant agrees to recognize and attorn to the purchaser or transferee, as the Landlord hereunder and Landlord shall be and is hereby relieved and released from any liability under any and all of its covenants and obligations under the Lease arising out of any act, occurrence or event arising after such sale, conveyance, transfer or exchange.
ARTICLE XXIV
QUIET ENJOYMENT
      Section 24.01. Landlord’s Covenant.
     Upon timely payment by Tenant of the Rent, and upon the observance and performance of all of the covenants, terms and conditions on Tenant’s part to be observed and performed hereunder, Tenant shall peaceably and quietly hold and enjoy the Premises for the Term without unreasonable hindrance or interruption by Landlord or any other person or persons lawfully or equitably claiming by, through or under the Landlord, subject, nevertheless, to the terms and conditions of this Lease. Landlord may subject its interest in the Premises to a Lien or Mortgage provided, the lienholdcr furnishes Tenant with a Subordination, Attornment and Non-Disturbance Agreement.
ARTICLE XXV
MISCELLANEOUS
      Section 25.01. Index.
     Whenever in this Lease there is a reference to the Index, such reference shall refer to the following:
     (a) The “Index” as used in this Lease shall be deemed to mean The United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, U,S. City Average, Subgroup “All items”, (1982-84 = 100) (the “Index”). If at any time there shall not exist the Index in the format recited herein, Landlord shall substitute any official index published by the Bureau of Labor Statistics or successor or similar substitute any office index published by the Bureau of Labor Statistics, or successor or similar governmental agency, as may then be in existence and shall, in Landlord’s opinion, be most nearly equivalent thereto.
     (b) The sum to be increased in accordance with the provisions of the Index shall be increased using the following formula: Such sum shall be increased by a percentage equal to the percentage increase, if any, in the Index published for the Comparison Month over the Index published for the Base Month; provided, however, in no event shall said sum be less than that which was due immediately preceding the date of adjustment. If no Comparison Month or Base Month shall be specified, the Comparison Month shall be three (3) months prior to the anniversary of the Rent Commencement Date for the year of the increase, and the Base Month shall be three (3) months prior to the Rent Commencement Date.
      Section 25.12. Waiver.
     No payment by Tenant or receipt by Landlord of a lesser amount than the Rent herein stipulated shall not be deemed to be a waiver of any other default, term, covenant or condition concerning the same. No delay or omission in the exercise of any right or remedy of Landlord shall impair such a right or remedy or be construed as a waiver. The subsequent acceptance of Rent hereunder by Landlord shall not be deemed to be a waiver of any
7/18/97

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preceding breach by Tenant of any term, covenant or condition of this Lease, other than the failure of Tenant to pay the particular rental so accepted, regardless of Landlord’s knowledge of such preceding breach at the time of acceptance of such Rent.
      Section 25.03. Accord and Satisfaction.
     No payment by Tenant or receipt by Landlord of a lesser amount than the Rent herein stipulated shall be deemed to be other than on account of the earliest stipulated Rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as Rent be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord’s right to recover the balance of such Rent or pursue any other remedy in this Lease.
      Section 25.04. Entire Agreement.
     This Lease and the Exhibits attached hereto and forming a part hereof, set forth all the representations, covenants, promises, agreements, conditions and understandings between Landlord and Tenant concerning the Premises and there are no representations, covenants, promises, agreements, conditions or understandings, either oral or written, between them other than are herein set forth. Any subsequent alteration, amendment, change or addition to this Lease must be in writing, signed by Landlord and Tenant.
      Section 25.05. No Partnership.
     Landlord does not, in any way or for any purpose, become a partner of Tenant in the conduct of its business, or otherwise, or joint venture or a member of a joint enterprise with Tenant by reason of this Lease. The provisions of this Lease relating to the Percentage Rent payable hereunder are included solely for the purposes of providing a method whereby Rent is to be measured and ascertained.
      Section 25.06. Force Majeure.
     In the event that either party hereto shall be delayed or hindered in or prevented from the performance of any act required hereunder by reason of strikes, lock-outs, labor troubles, inability to procure materials, failure of power, governmental moratorium, riots, insurrection, war or other reason of a like nature not the fault of the party delaying in performing work or doing acts required under the terms of this Lease (but excluding delays due to financial inability), then performance of such act shall be excused for the period of such delay. The provisions of this Section 25.06 shall not operate or excuse Tenant from the prompt payment of Minimum Rent, Percentage Rent, additional rent or any other payments required by the terms of this Lease.
      Section 25.07. Holding Over.
     Any holding over after the expiration of the Term, with or without the consent of the Landlord, shall be construed to be a tenancy from month to month at a rent specified by Landlord in its sole discretion, which rent shall never be less than the then prevailing market rate for the Entire Premises (as determined solely by Landlord) and shall otherwise be on the terms and conditions herein specified, as far as applicable.
      Section 25.08. Notices.
     All notices hereunder must be served personally or by certified or registered mail, postage prepaid, addressed to Tenant and to Landlord at the address given below or at such other address as Landlord or Tenant may designate by written notice pursuant to this Section 25.08. Any notice given by mail shall be deemed given forty-eight (48) hours after deposit in the mail.
     
Landlord:
  Syufy Enterprises
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn.: Real Estate Department
 
   
Tenant:   
  Century Theatres, Inc.
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn.: Legal Department
      Section 25.09. Captions and Section Numbers.
     The captions, section numbers, article numbers, and index appearing in this Lease are inserted only as a matter of convenience and in no way define, limit, construe, or describe the scope or intent of such sections or articles of this Lease nor in any way affect this Lease.
      Section 25.10. Tenant Defined, Use of Pronoun.
     The word “Tenant” means each and every person or party mentioned as a Tenant herein, be the same one or more; and if there shall be more than one Tenant, any notice required or permitted by the terms of this Lease may be given by or to any one thereof, and shall have the same force and effect as if given by or to all thereof. The persons signing as Tenant shall be jointly and severally liable. The use of the neuter singular pronoun to refer to Landlord or Tenant shall be deemed a proper reference even though Landlord or Tenant may be an individual, a partnership, a corporation, or a group of two or more individuals or corporations. The necessary grammatical changes required to make the provisions of this Lease apply in the plural sense where there is more than one
 
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Landlord or Tenant and to either corporations, associations, partnerships, or individuals, males or females, shall in all instances be assumed as though in each case fully expressed.
      Section 25.11. Partial Invalidity.
     If any term, covenant or condition of this Lease or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such term, covenant or condition to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and each term, covenant or condition of this Lease shall be valid and enforced to the fullest extent permitted by law.
      Section 25.12. No Option.
     The submission of this Lease for examination does not constitute a reservation of or option for the Premises and this Lease becomes effective as a Lease only upon execution and delivery thereof by Landlord to Tenant.
      Section 25.13. Recording.
     Tenant shall not record this Lease or a memorandum thereof.
      Section 25.14. Legal Expenses.
     In the event that any time during the Term either Landlord or Tenant shall institute any action or proceeding against the other relating to the provisions of this Lease, or any default hereunder, or engage an attorney to enforce such provision then, and in that event, the unsuccessful party in such action or proceeding agrees to reimburse the successful party for the actual expenses of attorneys’ fees and disbursements incurred therein by the successful party.
     The successful party in such suit shall be entitled to its costs of suit and actual attorneys’ fees whether or not such action is prosecuted to judgment. “Successful party” within the meaning of this Section 25.14 shall include, without limitation, a party who brings an action against the other or who defends against an action brought by the other and whose position is substantially upheld.
      Section 25.15. Rights Cumulative.
     The rights and remedies of Landlord specified in this Lease shall be cumulative and in addition to any other rights and remedies provided by law.
      Section 25.16. Authority.
     If Tenant is a corporation or partnership, each individual executing this Lease on behalf of such entity represents or warrants that he or she is duly authorized to execute and deliver this Lease on behalf of such entity and that such entity shall be bound by all the terms and provisions hereof.
      Section 25.17. Mortgage Changes.
     Tenant shall not unreasonably withhold its consent to changes or amendments to this Lease requested by the holder of any mortgage or deed of trust covering Landlord’s interest in the Premises so long as such changes do not materially alter the economic terms of this Lease or otherwise materially diminish the rights or materially increase the obligations of Tenant hereunder.
      Section 25.18. Time of the Essence.
     Time is of the essence in each and every, provision of this Lease except for delivery of possession of the Premises as set forth herein.
          Executed as of the date first written above.
         
    LANDLORD: SYUFY ENTERPRISES, A
CALIFORNIA LIMITED PARTNERSHIP:
 
      /s/ Raymond Syufy
 
       
 
  TENANT:   CENTURY THEATRES, INC.
DELAWARE CORPORATION

/s/ Joseph Syufy

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EXHIBIT 10.27(b)
First Amendment to Lease
      This First Amendment to Lease (this “ Amendment ”) dated April 15, 2005 is executed by and between Stadium Promenade LLC, a California limited liability company (“ Landlord ”) and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc, a Delaware corporation (“Century Theatres ( DE )”) entered into a lease dated October 1, 1996, (the “ Lease ”) for a motion picture building (the “Premises”) located in the City of Orange, State of California and known as Century Stadium Promenade; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, Stadium Promenade LLC, a California limited liability company, has succeeded Syufy Enterprises, L.P., as Landlord; and
      Whereas, Stadium Promenade LLC has assumed all obligations of Syufy Enterprises, L.P., as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Right to Renovate
     1. In addition to Landlord’s rights under the Lease (including, without limitation, Landlord’s rights pursuant to Section 2.02 of the Lease), Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter in any manner the Entire Premises or any portion thereof (a “Renovation”) without Tenant’s consent; provided, however, that Landlord shall use commercially reasonable efforts to ensure that a Renovation does not materially impede Tenant’s reasonable access to and use of the Leased Premises.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, a Renovation. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Leased Premises resulting from or in connection with a Renovation, and Tenant waives and shall indemnify and hold harmless
             
 
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Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with a Renovation (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
     3. Within a reasonable period of time following receipt of Landlord’s written request (but in no event more than one hundred eighty (180) days), Tenant shall re-paint Tenant’s Building and any other buildings which are a part of the Leased Premises as Landlord deems necessary or desirable in its sole and absolute discretion and in connection with a Renovation.
B. Pavement Area
     1. From and after the date hereof, the “Premises” or “Leased Premises” described in Section 2.01 of the Lease shall include only Tenant’s Building, and shall not include the front entrance, paved entryway or lighting and landscaping contiguous to the Tenant’s Building (the “Pavement Area” ).
     2. Notwithstanding anything to the contrary herein or in the Lease, Tenant’s maintenance obligations set forth in Section 11.01 and Tenant’s indemnity obligations set forth in Section 10.01 of the Lease shall apply to the Pavement Area, and Tenant, at its sole cost and expense, shall keep the Pavement Area in first class order, condition and repair, and shall make all repairs necessary to keep the Pavement Area in such condition.
C. Insurance
     1. In the twelfth (12th) and thirteenth (13th) lines of Section 16.01, the following shall be deleted: “and Tenant Improvements other than improvements paid by Landlord”. In the eighth (8th) and ninth (9th) lines of Section 16.03, the following shall be deleted: “and Improvements paid for by Landlord as set forth in Section 5.01(c)”.
     2. Notwithstanding anything to the contrary herein or in the Lease, Tenant’s insurance obligations under the Lease (including, without limitation, the obligations set forth in Sections 16.01 and 16.03 of the Lease) shall apply to the Pavement Area as well as the Premises.
     3. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Pavement Area. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property (including, without limitation, all “slip and fall” incidents) located in, on or about the Pavement Area, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Pavement Area (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
             
 
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D. Landlord’s Right to Develop
     1. Section 2.02 of the Lease, the following is hereby deleted in its entirety and replaced with the following:
In addition to Landlord’s other development rights contained in the Lease, Tenant expressly agrees that Landlord shall retain all rights to develop the rooftop area of the Building, including, without limitation, all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, sell, lease, license, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
E. Surrender
     The third and fourth sentences of Section 14.02 are hereby deleted in their entirety and replaced with the following:
Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the
             
 
    3     Century Stadium Promenade - Orange, California

 


 

termination of the Lease in accordance with the provisions thereof or at law.
F. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
             
 
    4     Century Stadium Promenade - Orange, California

 


 

      In Witness whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
       
Syufy Enterprises, L.P.,
a California Limited partnership “ Landlord”
  Century Theatres, Inc.,
a California corporation “Tenant”
 
   
/s/ Raymond Syufy,
  /s/ Joseph Syufy,
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
             
 
    5     Century Stadium Promenade - Orange, California

 

 

EXHIBIT 10.27(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Stadium Promenade LLC, a California limited liability company (“Landlord”) and Century Theatres , inc., a California corporation (“Tenant”) .
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc, a Delaware corporation (“Century Theatres (DE) ”) entered into a lease dated October 1, 1996, as amended by that certain First Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (the “ Lease ”) for a motion picture building (the “Premises”) located in the City of Orange, State of California and known as Century Stadium Promenade; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE) as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, Stadium Promenade LLC, a California limited liability company, has succeeded Syufy Enterprises, L.P., as Landlord; and
      Whereas, Stadium Promenade LLC has assumed all obligations of Syufy Enterprises, L.P., as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that, notwithstanding anything to the contrary therein, the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
             
 
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     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
       
Stadium Promenade, L.L.C.,
a California limited liability company
“Landlord”
  Century Theatres, Inc.,
a California corporation
“Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
for its Managing Member
  Chief Executive Officer
             
 
    2     Century Stadium Promenade - Orange, California

 

 

EXHIBIT 10.27(d)
Execution Version
THIRD AMENDMENT TO LEASE
(Stadium Orange)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 5, 2006 to be effective as of the Effective Date (as defined hereinbelow by and between [STADIUM PROMENADE LLC, a California limited liability company (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises (“Original Landlord”)) and Century Theaters, Inc., a Delaware corporation (“Original Tenant”), entered into a certain Lease dated as of October 1, 1996 (the “Original Lease”) for certain premises located in City of Orange, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of April 15, 2005 (the “First Amendment”), and (ii) that certain Second Amendment to Lease dated as of September 29, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the

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Stock Purchase Agreement is terminated, this Amendment shall become void ab initio and of no force and effect.
     3.  Site Plan. The Site Plan attached as Exhibit A to the Original Lease is hereby deleted and replaced by Exhibit A attached hereto and made a part hereof. All references in the Lease to the Site Plan shall mean and refer to Exhibit “A” attached hereto.
     4.  Extension of Term. The second sentence of Section 3.02 of the Original Lease shall be deemed deleted in its entirety and shall be of no further force or effect.
     5.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the Los Angeles, Orange County and Inland Empire MSA (the “Applicable MSA”) typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     6.  Trade Name. Notwithstanding Sections 1.02.4 and 10.01 of the Original Lease, if Tenant shall change the trade name under which the majority of its motion picture theater complexes are operated, or if Tenant shall assign the Lease or sublet the Premises in accordance with Lease, then the Premises may be operated under the trade name used by Tenant or such assignee or subtenant (as the case may be) in the majority of the motion picture theatre complexes that it operates.
     7.  Hours of Operation. Notwithstanding anything contained in Section 10.02 of the Original Lease to the contrary, Tenant shall not be obligated to open or operate its business in the Premises on such days or at such times that a majority of other first-class motion picture theater complexes (whether owned by Tenant or others) in the Applicable MSA market area typically are not open and operating for business.

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     8.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
     9.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including

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the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     10.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XVIII of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 8 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or

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release Tenant from any liabilities or obligations arising under the Lease.
     11.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     12.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     13.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
“Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed

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uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     14.  Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the seven (7) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
          (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
          (ii) Attributable to the annual inflationary increases in real estate taxes; or
          (iii) Attributable to the Acquisition on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the seven (7) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the seventh (7 th ) anniversary of the Effective Date of this Amendment.

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     15.  Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations, changes and improvements, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 5 of this Amendment. In addition, Tenant shall not move the main entrance of the theater without Landlord’s prior written consent, which consent may be withheld in Landlord’s sole and absolute discretion.
     16.  Conditions of Record. Notwithstanding anything contained in the Lease to the contrary (including, without limitation, Section 2.04 of the Original Lease), Tenant shall not be bound by any future documents of record, if and to the extent that the terms and provisions thereof would (i) conflict with Tenant’s express rights and privileges under the Lease or Landlord’s express duties and obligations under the Lease, or (ii) materially and adversely impact Tenant’s operation of the Premises as a motion picture theatre, or (iii) materially increase the cost to Tenant of operating its business at the Premises. In addition, Landlord covenants and agrees that any covenants or other restrictions of record hereafter recorded against the Entire Premises (or any portion thereof) and binding upon the Premises will be applied in a non-discriminatory manner to all tenants and occupants of the Entire Premises (subject to reasonable and customary distinctions for size and use of the affected premises).
     17.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third

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party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements existing on the date hereof and any extensions thereof that may be exercised by the licensee or lessee thereunder regarding Rooftop Equipment. The lessees or licensees under such agreements may unilaterally extend or renew if and to the extent provided under such agreements, but Landlord may not renew or extend such agreements or extend such agreements unilaterally if such systems interfere with the transmission received by Tenant’s Rooftop Equipment installed pursuant to this Section.
     18.  Alterations and Development by Landlord, (i) Notwithstanding anything to the contrary set forth in the Lease (including, without limitation, Section 2.02 and Section 2.03), and except as substantially shown on the Site Plan attached hereto, Tenant’s prior written consent (which shall not be unreasonably withheld, delayed or conditioned) shall be required only with respect to any new buildings, improvements (but not maintenance or repairs), alterations or additions located or proposed to be located within the “Protected Area” (but not outside the Protected Area) of the Entire Premises (as shown on the Site Plan). Tenant shall not withhold its consent unless any such new buildings, improvements, alterations or additions would materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage) in a direct and demonstrable manner.
  (ii)   Landlord shall not lease, sell or use any space on the Entire Premises or contiguous property which permits the operation of a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on the Entire Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food, a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”; a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre. In addition, Landlord shall not place any carts, kiosks, or other temporary structures selling any items within an area that is seventy (70) feet in either direction from the center line of the main entrance of Tenant’s Building and extending out from such main entrance to the curb as shown as the No Kiosk Area on the Site Plan. Notwithstanding the foregoing provisions of this Subsection 18(iv), landlord may have only one (1) normal size kiosk (no greater

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      than five feet (5') in width and eight feet (8') in length) selling food and beverages (except for popcorn and bulk candy which may not be sold in such kiosk) within ten feet (10') of the perimeter of the existing water feature shown on the Site Plan.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
 
  (vi)   Any improvements in the area shown as the Future Pad (Building 12) on the Site Plan shall not exceed twenty eight feet (28’) in height, other than an entrance element no wider than twelve feet (12’).
     19.  Signage. Notwithstanding Section 14.04 of the Original Lease to the contrary, Tenant shall not be required to remove or pay for the removal of its signage (or the installation of new signage) as a consequence of Landlord’s revision of the Sign Criteria. The responsibilities of Tenant with respect to the maintenance, repair and replacement of Tenant’s signage shall be governed by Article XI of the Lease, subject to the restrictions and approval rights of Landlord under Article XIV of the Lease (as hereby amended). If new pylon and/or monument signs are instructed in the Entire Premises, as to any such signs on which Tenant has a sign panel, Tenant will pay Tenant’s pro rata share (based on the relative size of Tenant’s sign panel to all of the sign panels on the applicable signs) of the costs to construct such signs. In the event any such new signs are constructed, Tenant shall have the right, but not the obligation, to place its sign panel at the top sign panel position on such signs. Tenant must elect to install such panels within thirty (30) days after Landlord notifies Tenant that the sign structure is available for sign panels, and if Tenant so elects, Tenant shall promptly thereafter install Tenant’s sign panel(s).
     20.  Competition/Radius Restriction. The radius restriction in Section 10.03 of the Original Lease shall not apply to any motion picture theatre complex which is developed, open and operating for business prior to Tenant or any affiliate of Tenant acquiring (or agreeing to acquire) any interest therein (as owner, lessee, operator, manager or otherwise).
     21.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal. Notwithstanding anything in this Lease to the contrary, in no event shall Tenant be obligated to remove and/or demolish the theater building (except as required by Section 9(B) above).
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events

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as Landlord solely shall determine.
     22.  California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
     Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     23.  Termination of Lease and Lessee’s Right to Possession. The fourth (4th) sentence of the fourth (4th) paragraph of Section 22.02 of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;

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     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     24.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgage, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.

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     Notices are to be delivered, mailed or couriered to the following address(es):
     
 
To Landlord:
  Stadium Promenade, LLC
c/o SyWest Development
Attention: William Vierra
 
   
To Tenant:    
  Century Theatres, Inc.
c/o Cinemark, Inc.
3900 Dallas Parkway
Suite 100
Plano, TX 75093
Attention: Legal Department
     25. Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     26.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     27.  Name of Center. The name of the Center is Stadium Promenade.
     28.  Prior Amendments. The First Amendment and the Second Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such First Amendment and Second Amendment in their entirety.
     29.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
     30.  Passes. On the condition that Syufy Enterprises, LP is affiliated with Landlord, Tenant shall provide Landlord throughout the Term of the Lease (including any extension periods) with one hundred twenty-five (125) annual passes, each good for admission by bearer, plus a guest each year. The passes shall carry no surcharge or fee and shall not otherwise impose restrictions beyond those required by the film distribution companies. The passes shall provide admission to any of Tenant’s and Tenant’s affiliates’ theaters in the United States.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
         
Landlord;    
 
       
STADIUM PROMENADE, LLC,    
a California limited liability company    
 
By:
  Syufy Enterprises, L.P.,
a California limited partnership
   
Its:
  Sole Managing Member    
 
       
By:
  Syufy Properties, Inc.,
a California corporation
   
Its:
  General Partner    
 
       
By:
  /s/ William Vierra    
 
       
 
  William Vierra    
Its:
  Senior Vice President    
 
       
Tenant:    
 
       
CENTURY THEATRES, INC., a California corporation    
 
       
BY:
  /s/ David Shesgreen    
 
       
Name:
  David Shesgreen    
Title:
  PRESIDENT & CEO    

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EXHIBIT 10.28(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
Table of Contents
         
    Page No.  
RECITALS
    1  
 
       
ARTICLE I EXHIBITS — DEFINITIONS
    1  
 
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II PREMISES — TERM — OPTIONS -COVENANT OF TITLE
    2  
 
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    3  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title
    3  
 
       
ARTICLE III USE OF PREMISES
    4  
 
       
3.01 Use
    4  
 
       
ARTICLE IV RENT
    4  
 
       
4.01 Annual Fixed Rent
    4  
4.02 Percentage Rent
    5  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V TAXES, ASSESSMENTS AND UTILITIES
    6  
 
       
5.01 Impositions
    6  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.03 Contest of Taxes
    6  
5.04 Utilities
    7  
5.05 Personal Property Taxes
    7  
 
       
ARTICLE VI INSURANCE
    7  
 i

 


 

LEASE
Table of Contents
         
    Page No.  
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6 03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held in Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII MAINTENANCE, REPAIRS AND ALTERATIONS
    9  
 
       
7.01 Alterations -Changes
    10  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII ENVIRONMENTAL MATTERS
    10  
 
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    11  
8.03 Remedial Work
    12  
8.04 Maintenance of Premises
    13  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    13  
8.06 Landlord Inspection
    14  
8.07 Effect of Termination
    14  
 
       
ARTICLE IX IMPROVEMENTS
    14  
 
       
9.01 Tenant Improvements
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    15  
9.04 Ownership of Improvements
    15  
9.05 Control.
    15  
 
       
ARTICLE X INDEMNITY
    15  
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Table of Contents
         
    Page No.  
10.01 Landlord’s Indemnity
    15  
10.02 Tenant’s Indemnity
    16  
 
       
ARTICLE XI ASSIGNMENT AND SUBLETTING
    16  
 
       
11.01 Assignment and Subletting
    16  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII MORTGAGE SUBORDINATION
    16  
 
       
12 . 01 Existing Mortgages
    16  
12.02 Future Mortgages
    17  
 
       
ARTICLE XIII CONDEMNATION — EMINENT DOMAIN
    17  
 
       
13.01 Definitions
    17  
13.02 Notice to Other Party
    17  
13.03 Total Taking — Effect on Rent and Term
    18  
13.04 Distribution of Award for Taking
    18  
13.05 Partial Taking — Rent Adjustments
    18  
13.06 Partial Taking — Option to Terminate
    18  
13.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XIV DEFAULT
    18  
 
       
14.01 Tenant’s Default
    18  
14.02 Landlord’s Remedies Cumulative
    19  
14.03 Landlord’s Default
    20  
14.04 Waiver of Redemption
    20  
14.05 Dispute Resolution
    21  
14.06 Attorneys’ Fees
    21  
 
       
ARTICLE XV REPRESENTATIONS AND WARRANTIES
    21  
 
       
15.07 Landlord’s Representations and Warranties
    21  
15.02 Tenant’s Representations and Warranties
    22  
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Table of Contents
         
    Page No.  
ARTICLE XVI DAMAGE OR DESTRUCTION
    22  
 
       
16.01 Repairs, Alterations and Further Improvements
    22  
16.02 Prompt Repair
    23  
16.03 Rent Adjustment
    23  
16.04 Damage During Last Two (2) Years of Term
    23  
 
       
ARTICLE XVII MISCELLANEOUS
    23  
 
       
17.01 Limitation on Liability
    23  
17.02 Brokers
    24  
17.03 Modification
    24  
17.04 Severability
    24  
17.05 Governing Law
    24  
17.06 Terminology
    24  
17.07 Counterparts
    24  
17.08 Binding Effect
    24  
17.09 Captions
    24  
17.10 Notices to Landlord and Tenant
    24  
17.11 Addresses for Notices to Landlord and Tenant
    25  
17.12 Entire Agreement
    25  
17.13 Sale or Transfer of Premises
    25  
17.14 Force Majeure
    26  
17.15 Waiver
    26  
17.16 Estoppel Certificate
    26  
17.17 Number and Gender
    26  
17.18 No Holding Over
    26  
17.19 Mechanics Liens
    26  
17.20 Relationship of Parties
    27  
17.21 Time of the Essence
    27  
17.22 Facsimile Copies
    27  
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Table of Contents
         
    Page No.  
17.23 Anti-Merger
    27  
 
       
SIGNATURE PAGE
    27  
 
       
Exhibit A     A Description of Entire Premises
       
Exhibit B     A Site Plan of Entire Premises
       
Exhibit C     Form of Memorandum of Lease
       
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LEASE
     THIS INDENTURE OF LEASE, dated and effective as of July 1, 1996, by and between SYNM PROPERTIES, INC., a New Mexico Corporation with an office at 150 Golden Gate Ave., San Francisco, CA, hereinafter called “Landlord”, and CENTURY THEATRES, INC., a Delaware corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in a parcel of land described on Exhibit A attached hereto.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the tract of land hereinafter referred to as “Entire Premises”.
               EXHIBIT B — a site plan of the Entire Premises showing the location of the Tenant’s Building, outlined in red.
               EXHIBIT C — Form of Memorandum of Lease
      1.02 Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” and “Rent Commencement Date” shall mean the date which is the earlier of (i) nine months after Tenant has secured a building permit for construction of Tenant’s building or (ii) the date on which Tenant opens for business in the Premises.
               The term “Common Facilities” or “Common Areas” shall include the parking areas, streets, driveways, curb cuts, access facilities, aisles, sidewalks, malls, landscaped areas, and other common and service areas within the Entire Premises with the improvements thereon, whether or not shown on Exhibit B.
               The term “Default Rate” shall mean the Ten percent (10%).
               The term “Entire Premises” shall mean the tract of land described on Exhibit B.
               The term “Initial Term” is defined in Section 2.02 herein.

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               The term “Leased Premises” or “Premises” shall mean Tenant’s Building outlined in red on Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean ***      successive separate periods of ***      each and ***      successive period of ***
               The term “Percentage Rate” shall mean ***
               The term “Planned Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “Tenant’s Building” shall mean the building to be erected by Tenant at Tenant’s sole cost..
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
      2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date.
          D) During the Lease Term, Landlord grants to Tenant and its employees, agents, customers and other invitees a non-exclusive easement for free parking and ingress and egress on and over the Entire Premises for Tenant, Tenant’s employees, agents, contractors, customers and invitees. Tenant shall be responsible for all costs associated with the Entire Premises exclusive of any Landlord’s Buildings that may be constructed thereon. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use.

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      2.02 Term of Lease.
               Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter and shall terminate on the last day of the calendar month during which the date which is ***      after the Commencement Date occurs. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
      2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***      consecutive additional periods of ***      each and ***      additional period of ***      (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default (meaning the breach of any obligation hereunder and failure to cure that breach within the time permitted in Section 14.01) at time of the exercise of the renewal and at the commencement of the renewal term.
      2.04 Covenant of Title; Authority and Quiet Possession: Transfer of Title.
               (A) Landlord represents and warrants to Tenant that Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple.
               (B) Maintenance of Entire Premises At all times during the Term, Tenant shall keep and maintain the Exterior Common Facilities in the Entire Premises and Tenant’s Building in good order and repair and in a clean and safe condition, reasonably free of debris. The lighting for the Exterior Common Facilities shall be turned on by Tenant on each day that business is conducted on the Premises at or about the

3


 

same time that the municipality turns on street lights, and same shall be kept lighted for one (1) hour after all Tenants close for business. Tenant’s obligation hereunder shall include maintaining the parking areas of the Entire Premises free of potholes and assuring that they are properly coated and sealed and striped as needed. Tenant shall make any and all additions to and all alterations and repairs in, on and about the Exterior Common Facilities, which may be required by, and shall otherwise observe and comply with, all public laws, ordinances and regulations from time to time applicable to the Exterior Common Facilities. Tenant shall indemnify and save harmless Landlord and any and all other Landlord’s tenants from and against all actions, claims and damages by reason of Tenant’s failure to comply with and perform its obligations under this section.
               (C) Tenant’s Liens Tenant will not permit the Entire Premises to become subject to any mechanics’, laborers’ or materialmen’s lien on account of labor or material furnished to Tenant or claimed to have been furnished to Tenant in connection with work of any character performed or claimed to have been performed on the Entire Premises by or at the direction or sufferance of Tenant; provided, however, Tenant shall have the right to contest in good faith and with reasonable diligence the validity of any such lien or claimed lien and on final determination of the lien or claim for the lien, Tenant will immediately pay any judgment rendered with all proper costs and charges, and will, at its own expense, have the lien released and any judgment satisfied.
ARTICLE III
USE OF PREMISES
      3.01 Use.
          A) The Premises may be used for the Planned Use no other purpose.
          B) Landlord shall agree and consent to such utility and other easements encumbering the Entire Premises or benefiting the Entire Premises as Tenant may reasonably require for its use and occupancy of the Premises.
          C) Landlord agrees that no use of the Entire Premises shall be permitted which is inconsistent with the operation of the Planned Use. Landlord further agrees not to permit or allow any portion of the Entire Premises to be used by any other tenant, subtenant, licensee, or occupant (including Landlord) for the exhibition of commercial movies or as a commercial movie theater complex.
ARTICLE IV
RENT
      4.01 Annual Fixed Rent.
          A) Beginning on the Rent Commencement Date, Tenant shall pay to Landlord during the Lease Term Annual Fixed Rent in the amount of ***     . The Annual Fixed Rent shall be payable in advance in twelve equal monthly installments. The Annual Fixed Rent shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 (B) below.
          B) The Annual Fixed Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Annual Fixed Rent shall be increased on the first day of the ***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by an amount that is ***      greater than the Annual Fixed Rent payable immediately before the Adjustment date in question.
      4.02 Percentage Rent.

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          In addition to the payment of Annual Fixed Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      of the Gross Sales for such Lease Year exceeds the Annual Fixed Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross sales and the annual fixed rate percentage for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Annual Fixed Rate and Gross Sales for the first Lease Year.
          Gross Sales shall mean all box office receipts, and receipts from sales of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant and returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions”. Commissions paid to agencies or other third parties for selling tickets and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar officer of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of eighteen (18%) percent from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof.
      4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
      4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
      4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of ten (10%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
          5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of

5


 

the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay when due all Impositions (exclusive of Landlord’s Buildings, if any) assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises (exclusive of Landlord’s Buildings, if any).. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
          B) In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          C) Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against Landlord’s Buildings, if any.
      5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
      5.03 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.03. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.03.
      5.04 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities consumed on the Entire Premises exclusive of Landlord’s

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Buildings, if any. Any utility improvements presently serving the Entire Premises shall be maintained, repaired and replaced by Tenant, at Tenant’s expense.
      5.05 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
      6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
      6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises, Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) as well as any and all improvements on the Common Area and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) including Builder’s Risk including earthquake to the extent of not less than 100% of the full replacement cost thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Upon written request, Tenant shall name Landlord and any parties requested by Landlord and the holder of the first mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Tenant in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
      6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.

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          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
      6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
      6.05 Insurance Money and Other Funds Held in Trust. All insurance money or proceeds received by the Tenant and/or Landlord shall be held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and Second, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
      6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVI hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Tenant and Landlord shall apply the proceeds of the insurance collected to the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Tenant and Landlord by the licensed architect or engineer in charge of the work. Any amounts payable to Tenant or any Affiliate of Tenant for work or services performed or materials provided as part of any such repair, replacement, restoration or rebuilding shall not exceed competitive rates for such services or materials and Tenant shall, upon request of Landlord, make available to Landlord and its representatives all books and records of Tenant relating to such work, services and materials. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Tenant or Landlord with respect to the damage or destruction involved, and not used, shall be and remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Tenant and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.

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      6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
      6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unleasable or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
      7.01 Alterations—Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto.. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained, which approval shall not be unreasonably withheld.
          B) Tenant shall at all times keep the Entire Premises, Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may, at its option, remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
      7.02 Repairs—Maintenance.

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          A) Tenant shall, at its sole cost and expense, maintain and repair the Entire Premises and Tenant’s Building and all improvements on the Entire Premises exclusive of Landlord’s Buildings if any and including all exterior lighting and signs.
          B) Tenant shall also be responsible for any losses or damages resulting to Landlord’s Buildings, if any from any materials, substances or liquids which are leaked or discharged from any area outside Landlord’s Buildings, if any, unless such leakage or discharge is caused by Landlord or Landlord’s agents or employees.
          Tenant shall commence all of the repairs and maintenance within 3 days after receiving notice thereof from Landlord (provided that in the case of an emergency Tenant shall commence such work immediately upon receiving notice) and shall be diligently completed in a good and workmanlike manner. Notwithstanding the foregoing, Landlord shall have the right and option (but not the obligation) to undertake any such repair, maintenance or other items, in which event Tenant shall reimburse Landlord for all of the costs thereof within 30 days after Landlord’s request therefor. If Tenant fails to reimburse Landlord within the 30 day period, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum until such payment has been made.
ARTICLE VIII
ENVIRONMENTAL MATTERS
      8.01 Definition. For purposes of this Article VIM, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
      8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its

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agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release; investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any

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settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
      8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
      8.04 Maintenance of Premises.
          A) Subject to Landlord’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.

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      8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including, reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
      8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or

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incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
      8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
      9.01 Tenant Improvements. Tenant at its sole cost and expense shall complete all the required on-site and off-site improvements, including all signs, required for the development of the Entire Premises. In addition Tenant shall construct a motion picture theater building on the Premises containing approximately ninety-six thousand two hundred ninety (96,290) square feet with twenty-four auditoriums.
      9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of by Tenant of Tenant’s Building or Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
      9.03 Permits: Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
      9.04 Ownership of Improvements.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein excluding moveable trade fixtures and personal property of Tenant, shall become the property of Landlord, unless and to the extent Tenant to removes any of the foregoing pursuant to Section 9.04 (B).

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          B) Tenant shall have the right to remove all trade fixtures, equipment and furnishings, including seats, carpets, draperies, screen, sound reproducing equipment, projection equipment, furniture and lobby frames from the Premises without notice to Landlord provided Tenant replaces all items removed with items of similar quality or better quality and the foregoing shall remain the property of the Tenant at the expiration or earlier termination of the Lease. In addition, Landlord shall have the right if Landlord so elects by giving written notice to Tenant of such election at any time before ninety (90) days prior to the end of the Term (including any renewals or extensions) hereof to remove at Tenant’s sole cost any other Improvements and all additions, alterations and improvements thereto or replacements thereof erected, constructed, or installed on the Premises. The removal of any of the foregoing shall be completed within thirty (30) days following the end of the Term hereof (including any renewals thereof or any earlier termination permitted by this Lease.
      9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
      10.01 Landlord’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Tenant, its agents, employees, licensees, invitees or contractors on the Leased Premises, occurring within the Leased Premises or (ii) arising from Tenant’s or its employees use of the Leased Premises.
      10.02 Tenant’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Tenant and its agents, employees, tenants, licensees and contractors, Landlord shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant (and its successors, assigns and subletees), and all of their directors, officers, employees and agents, hereinafter referred to as “Tenant Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Landlord, its agents, employees, licensees, invitees on the Entire Premises or contractors, occurring within the Entire Premises, or (ii) arising from Landlord’s use of the Entire Premises.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
      11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease. Landlord shall be entitled to all rent from any assignment or sublease in excess of the Annual Fixed Rent set forth in this Lease.
          B) Any assignment of this Lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.

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          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without Landlord’s consent, assign this Lease (a) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (b) to Tenant’s Parent Corporation, or (e) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, provided that such corporation duly and validly then guarantees the performance of the obligations under this Lease.
      11.02 Notice to Landlord. Tenant shall give notice to Landlord in writing of any assignment of the Lease ten (10) days prior to such event.
ARTICLE XII
MORTGAGE SUBORDINATION
      12.1 Existing Mortgages. If there is an existing mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises or in any other part of the Entire Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
      12.2 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIII
CONDEMNATION — EMINENT DOMAIN
      13.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Entire Premises.

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          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
      13.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
      13.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
      13.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any for the Fair Market Value of all Land, buildings and other improvements on the Entire Premises and all Severance Damages.
          B) To Tenant, the amount awarded, if any, for loss of goodwill, lost business, lost profits, relocation expenses and fixtures; and
          C) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 13.04 out of amounts awarded by the governmental body taking the Premises.
      13.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises or the parking taken bears to the total area of the Premises or the parking.
      13.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty-three percent (33%) of the Building or thirty-three (33%) of the

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parking is taken by condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
      13.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses, fixtures and relocation expenses against the acquiring governmental Agency.
ARTICLE XIV
DEFAULT
      14.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Fixed Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease; provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
      14.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 14.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) The worth, at the time of the award,” as used in subsections 14.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 14.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 14.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 14.02(C), Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 14.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at ten percent (10%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
      14.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be

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in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
      14.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
      14.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 14.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party, which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. Arbitration shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association.
      14.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action far proceeding.
ARTICLE XV
REPRESENTATIONS AND WARRANTIES
      15.01 Landlord’s Representations and Warranties. Landlord represents and warrants:

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          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
      15.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a Delaware corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVI
DAMAGE OR DESTRUCTION
      16.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. In the event of damage to or destruction of the Tenant’s Building or any Improvements on or to the Premises to be covered by the insurance described in Article 6:
               (1) Damages of Less Than Fifty Percent (50%) of Replacement Cost. If the cost of repairing or reconstructing the Tenant’s Building or Improvements to the condition and form prior to such damage or destruction is not in excess of Fifty percent (50%) of the then new replacement cost of the Improvements and such repairs or reconstruction of any such damage or destruction can be made under then

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existing laws, ordinances, statutes or regulations of any governmental authorities applicable thereto (or can be so made with minor and non-material changes to the former condition and form of property damaged or destroyed), Tenant shall effect, and Landlord and Tenant agree that the funds derived from insurance acquired pursuant to Article 6 shall be made available to effect, such repair and reconstruction of the structure or improvement so damaged or destroyed to substantially its condition prior to said damage or destruction with such alterations thereto as Tenant shall reasonably determine prudent or valuable under the circumstances, including any changes required to comply with applicable law, with the then prevailing construction practices applicable to the Premises. Tenant shall be responsible for all costs in excess of Insurance proceeds available All such work shall be carried on in accordance with Drawings prepared by a licensed architect or architects approved by Landlord (acting reasonably) if such an architect is reasonably required, given the scope and nature of the work. In disbursing insurance proceeds the Tenant and Landlord may rely upon and accept the certified determinations of such architect with respect to estimated costs, awarding of contracts, sufficiency of bonds, progress of construction, interpretation of plans and specifications, compliance with same, and completion of construction. No extras or changes in Drawings shall be made by Tenant without first giving written notice of such changes to Landlord and obtaining Landlord’s approval thereof (which approval shall not be unreasonably withheld or delayed).
               (2) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of the Fifty percent (50%) provided in subparagraph (A)(1) of this Section 16.01, or if such cost is less than Fifty percent (50%), but such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto (and cannot be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), the term shall end as of the date of such damage on destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
      16.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated or elects to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided and subject to the provisions of subparagraph (B) of Section 16.01), and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
      16.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall thereafter not abate but continue for as long as and to the extent such Improvements are untenantable.
      16.04 Damage During Last Two (2) Years of Term. If there occurs during the last two (2) years of the Initial Term or at any time during a Renewal Period damage or destruction to any Improvement on or in the Premises and the costs of repairing, restoring, replacing or rebuilding the same exceed Five Thousand Dollars ($500,000), then Tenant may elect to terminate the Term and, in such event, Tenant shall give notice to Landlord of its election within sixty (60) days after its determination of the amount of damage, and the Term shall thereupon terminate as of the date of such notice and all insurance proceeds shall become the property of Landlord.

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ARTICLE XVII
MISCELLANEOUS
      17.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Entire Premises and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Entire Premises.
      17.02 Brokers. Landlord and Tenant each represent to the other that neither has any obligation to any broker or finder in connection with this transaction, and that no fee or commission is due any broker, finder, or similar person in connection herewith. Landlord and Tenant each indemnifies the other and agrees to hold the other harmless from and against any and all claims, demands, liabilities, lawsuits, costs, and expenses (including reasonable attorneys’ fees) for any fee or commission due to any other broker, finder, or similar person in connection with this transaction and arising out of the act of the indemnifying party.
      17.03 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
      17.04 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
      17.05 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
      17.06 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
      17.07 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
      17.08 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
      17.09 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
      17.10 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 17.11 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express

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courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 17.11 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent..
      17.11 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   SYNM Properties, Inc.
150 Golden Gate Ave.
San Francisco, CA 94102
Attn.: Real Estate Department
 
       
 
       
 
  To Tenant:   Century Theatres, Inc.
150 Golden Gate Avenue
San Francisco, CA 94102
Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
      17.12 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
      17.13 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.

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      17.14 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
      17.15 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
      17.16 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
      17.17 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
      17.18 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
      17.19 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
      17.20 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.

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      17.21 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
      17.22 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
      17.23 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
         
    Executed as of the date first written above.
 
       
TENANT:
       
 
       
 
  CENTURY THEATRES, INC.,
a Delaware Corporation
   
 
       
 
  By: /s/ Joseph Syufy    
 
  Print Name: Joseph Syufy    
 
  Title: Senior Exec V.P.    
 
       
LANDLORD:
       
 
       
 
  SYNM PROPERTIES, INC.,
a New Mexico Corporation
   
 
       
 
  By: /s/ Alan Steuer    
 
  Print Name: Alan Steuer    
 
  Title: CFO    

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EXHIBIT 10.28(b)
First Amendment to Lease
      This First Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between SYNM Properties, Inc., a New Mexico corporation (“Landlord”), and Century Theatres, Inc., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE) ”), entered into a lease dated July 1, 1996 (the “ Lease ”) for a motion picture building and related parking (the “Premises”) located at 4901 Pan American Freeway, Northeast, Albuquerque, New Mexico; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas , Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas , Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas , the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore , the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01(a) of the Lease, the following is hereby inserted:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
Century Rio 24 — Albuquerque, NM

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     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment
Century Rio 24 — Albuquerque, NM

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or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century Rio 24 — Albuquerque, NM

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
SYNM Properties, Inc.,
a New Mexico corporation
“Landlord”
      Century Theatres, Inc.,
a California corporation
“Tenant”
   
 
           
/s/ Raymond Syufy
 
Raymond Syufy,
      /s/ Joseph Syufy
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
Century Rio 24 — Albuquerque, NM

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EXHIBIT 10.28(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Properties, Inc., a California corporation (“Landlord”), and Century Theatres, Inc., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE) ”), entered into a lease dated July 1, 1996, as amended by that certain First Amendment to Lease, dated April 15, 2005, between SYNM Properties, Inc., a New Mexico corporation and Century Theatres, Inc., a California corporation (the “Lease”) for a motion picture building and related parking (the “Premises”) located at 4901 Pan American Freeway, Northeast, Albuquerque, New Mexico; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas , Syufy Properties, Inc., a California corporation has succeeded to and assumed all obligations of SYNM Properties, Inc., as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
Century Rio 24 — Albuquerque, NM

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     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Properties, Inc.,
a California corporation
“Landlord”
      Century Theatres, Inc.,
a California corporation
“Tenant”
   
 
           
/s/ Raymond Syufy
 
Raymond Syufy,
      /s/ Joseph Syufy
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
Century Rio 24 — Albuquerque, NM

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EXHIBIT 10.28(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(Rio 24)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY PROPERTIES, INC., a California corporation (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. SYNM Properties, Inc. (“Original Landlord”) and Century Theatres, Inc., a Delaware corporation (“Original Tenant”), entered into a certain Lease dated as of July 1, 1996 (the “Original Lease”), for certain premises located in Alberquerque, New Mexico.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of April 15, 2005 (the “First Amendment”) and (ii) Second Amendment to Lease dated as of September 29, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***      and rather than ***      Renewal Terms of ***      each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***      consecutive Renewal Terms of ***      each, followed by ***      additional and final Renewal Term of ***     
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Bernalillo typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.

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     6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     9.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and

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ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment hereof.
     12.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     13.  Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.

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  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     14.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     15.  No Obligation To Continuously Operate. Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     16.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition

7


 

shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  Remedies. The references in Article XIV of the Lease to California Code sections shall be disregarded. In the event of a breach or default by Tenant which is not cured within the applicable cure period (if any) set forth in the Lease, Landlord shall have any and all remedies now or later allowed by law or equity.
     18.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with applicable law.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Properties, Inc.
150 Pelican Way
San Rafael, California 94901
Attention: President

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  with a copy to:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
203 North LaSalle
Suite 1900
Chicago, IL 60601 94901
Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
c/o Cinemark, Inc.
3900 Dallas Parkway
Suite 500
Plano, TX 75093
Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     19.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     20.  Prior Amendments. The First Amendment and the Second Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such First Amendment and Second Amendment in their entirety.
     21.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
             
Landlord:    
 
           
SYUFY ENTERPRISES, L.P., a California limited partnership    
 
           
 
  By:
Name:
  /s/ Joseph Syufy
 
   
 
  Title:  
 
   
 
     
 
   
 
           
Tenant:    
 
           
CENTURY THEATRES, INC., a California corporation    
 
           
 
  By:   /s/ Raymond Syufy    
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   

 

 

EXHIBIT 10.29(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE — ROSEVILLE, CALIFORNIA
Table of Contents
         
    Page No.  
RECITALS
    1  
 
       
ARTICLE I EXHIBITS — DEFINITIONS
    1  
 
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II PREMISES — TERM — OPTIONS — COVENANT OF TITLE
    2  
 
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    2  
2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title
    3  
 
       
ARTICLE III USE OF PREMISES
    4  
 
       
3.01 Use
    4  
 
       
ARTICLE IV RENT
    4  
 
       
4.01 Annual Fixed Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V TAXES, ASSESSMENTS AND UTILITIES
    5  
 
       
5.01 Impositions
    5  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.03 Contest of Taxes
    6  
5.04 Utilities
    6  
5.05 Personal Property Taxes
    6  

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LEASE
Table of Contents
         
    Page No.  
ARTICLE VI INSURANCE
    6  
 
       
6.01 Acquisition of Insurance Policies
    6  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    7  
6.04 Landlord’s Acquisition of Insurance
    7  
6.05 Insurance Money and Other Funds Held in Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    8  
6.08 Waiver of Right of Recovery
    8  
 
       
ARTICLE VII MAINTENANCE, REPAIRS AND ALTERATIONS
    9  
 
       
7.01 Alterations — Changes
    9  
7.02 Repairs — Maintenance
    9  
 
       
ARTICLE VIII ENVIRONMENTAL MATTERS
    10  
 
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX IMPROVEMENTS
    13  
 
       
9.01 Tenant Improvements
    13  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership of Improvements
    14  

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LEASE
Table of Contents
         
    Page No.  
9.05 Control
    14  
 
       
ARTICLE X INDEMNITY
    14  
 
       
10.01 Landlord’s Indemnity
    15  
10.02 Tenant’s Indemnity
    15  
 
       
ARTICLE XI ASSIGNMENT AND SUBLETTING
    15  
 
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    15  
 
       
ARTICLE XII MORTGAGE SUBORDINATION
    16  
 
       
12.01 Existing Mortgages
    16  
12.02 Future Mortgages
    16  
 
       
ARTICLE XIII CONDEMNATION — EMINENT DOMAIN
    16  
 
       
13.01 Definitions
    16  
13.02 Notice to Other Party
    17  
13.03 Total Taking — Effect on Rent and Term
    17  
13.04 Distribution of Award for Taking
    17  
13.05 Partial Taking — Rent Adjustments
    17  
13.06 Partial Taking — Option to Terminate
    17  
13.07 Separate Tenant’s Award
    17  
 
       
ARTICLE XIV DEFAULT
    18  
 
       
14.01 Tenant’s Default
    18  
14.02 Landlord’s Remedies Cumulative
    18  
14.03 Landlord’s Default
    19  
14.04 Waiver of Redemption
    20  
14.05 Dispute Resolution
    20  

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LEASE
Table of Contents
         
    Page No.  
14.06 Attorneys’ Fees
    20  
 
       
ARTICLE XV REPRESENTATIONS AND WARRANTIES
    20  
 
       
15.01 Landlord’s Representations and Warranties
    20  
15.02 Tenant’s Representations and Warranties
    21  
 
       
ARTICLE XVI DAMAGE OR DESTRUCTION
    21  
 
       
16.01 Repairs, Alterations and Further Improvements
    21  
16.02 Prompt Repair
    22  
16.03 Rent Adjustment
    22  
16.04 Damage During Last Two (2) Years of Term
    22  
 
       
ARTICLE XVII MISCELLANEOUS
    22  
 
       
17.01 Limitation on Liability
    22  
17.02 Brokers
    22  
17.03 Modification
    23  
17.04 Severability
    23  
17.05 Governing Law
    23  
17.06 Terminology
    23  
17.07 Counterparts
    23  
17.08 Binding Effect
    23  
17.09 Captions
    23  
17.10 Notices to Landlord and Tenant
    23  
17.11 Addresses for Notices to Landlord and Tenant
    24  
17.12 Entire Agreement
    24  
17.13 Sale or Transfer of Premises
    24  
17.14 Force Majeure
    24  
17.15 Waiver
    24  
17.16 Estoppel Certificate
    25  

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LEASE
Table of Contents
         
    Page No.  
17.17 Number and Gender
    25  
17.18 No Holding Over
    25  
17.19 Mechanics Liens
    25  
17.20 Relationship of Parties
    25  
17.21 Time of the Essence
    25  
17.22 Facsimile Copies
    25  
17.23 Anti-Merger
    26  
 
       
SIGNATURE PAGE
    26  
 
       
Exhibit A            A Description of Entire Premises
       
Exhibit B            Form of Memorandum of Lease
       

v


 

LEASE
     THIS INDENTURE OF LEASE, dated and effective as of September 3, 1996, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, CA, hereinafter called “Landlord”, and CENTURY THEATRES, INC ., a Delaware corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in a parcel of land described on Exhibit A attached hereto.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the land.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the tract of land hereinafter referred to as “Entire Premises” or “Premises” or “Leased Premises”.
               EXHIBIT B — Form of Memorandum of Lease
      1.02 Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” and “Rent Commencement Date” shall mean the date which is the earlier of (i) nine months after Tenant has secured a building permit for construction of Tenant’s building or (ii) the date on which Tenant opens for business in the Premises.
               The term “Default Rate” shall mean the Ten percent (10%).
               The term “Entire Premises” shall mean the tract of land described on Exhibit A.
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” or “Premises” shall mean the tract of land described on Exhibit A.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
     
May 7, 1997   ROSEVILLE

1


 

               The term “Option Periods” shall mean ***      successive separate periods of ***      each and ***      successive period of ***
               The term “Percentage Rate” shall mean ***
               The term “Planned Use” shall mean the construction and operation of a 54,860 square foot multi-plex motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “Tenant’s Building” shall mean the building to be erected by Tenant.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
      2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date.
      2.02 Term of Lease.
               Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter and shall terminate on the last day of the calendar month during which the date which is ***      after the Commencement Date occurs. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
      2.03 Option to Extend Lease Term.
     
May 7, 1997   ROSEVILLE

2


 

          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***  consecutive additional periods of ***           each and ***      additional period of ***           (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***               of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default (meaning the breach of any obligation hereunder and failure to cure that breach within the time permitted in Section 14.01) at time of the exercise of the renewal and at the commencement of the renewal term.
      2.04 Covenant of Title: Authority and Quiet Possession: Transfer of Title.
               (A) Landlord represents and warrants to Tenant that Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple.
               (B) At all times during the Term, Tenant shall keep and maintain the Exterior Facilities in the Entire Premises and Tenant’s Building in good order and repair and in a clean and safe condition, reasonably free of debris. Tenant’s obligation hereunder shall include maintaining the parking areas of the Entire Premises free of potholes and assuring that they are properly coated and sealed and striped as needed. Tenant shall make any and all additions to and all alterations and repairs in, on and about the Exterior Facilities, which may be required by, and shall otherwise observe and comply with, all public laws, ordinances and regulations from time to time applicable to the Exterior Facilities. Tenant shall indemnify and save harmless Landlord from and against all actions, claims and damages by reason of Tenant’s failure to comply with and perform its obligations under this section.
               (C) Tenant will not permit the Entire Premises to become subject to any mechanics’, laborers’ or materialmen’s lien on account of labor or material furnished to Tenant or claimed to have been furnished to Tenant in connection with work of any character performed or claimed to have been performed on the Entire Premises by or at the direction or sufferance of Tenant; provided, however, Tenant shall have the right to contest in good faith and with reasonable diligence the validity of any such lien or claimed lien and on
     
May 7, 1997   ROSEVILLE

3


 

final determination of the lien or claim for the lien, Tenant will immediately pay any judgment rendered with all proper costs and charges, and will, at its own expense, have the lien released and any judgment satisfied.
ARTICLE III
USE OF PREMISES
      3.01 Use .
          A) The Premises may be used for the Planned Use no other purpose.
          B) Landlord shall agree and consent to such utility and other easements as Tenant may reasonably require. Tenant shall be subject to and responsible for all costs and granted all rights as set forth in the Grant of Reciprocal Easements and Agreement of Restrictions covering the Premises.
ARTICLE IV
RENT
      4.01 Annual Fixed Rent.
          A) Beginning on the Rent Commencement Date, Tenant shall pay to Landlord during the Lease Term Annual Fixed Rent in the amount of ***. The Annual Fixed Rent shall be payable in advance in twelve equal monthly installments. The Annual Fixed Rent shall be subject to adjustment every ***          after the Initial Rent Due Date as set forth in Section 4.01 (B) below.
          B) The Annual Fixed Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Annual Fixed Rent shall be increased on the first day of the ***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by an amount of ***                          greater than the Annual Fixed Rent payable immediately before the Adjustment date in question.
      4.02 Percentage Rent.
          In addition to the payment of Annual Fixed Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***                  of the Gross Sales for such Lease Year exceeds the Annual Fixed Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross sales and the annual fixed rate percentage for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Annual Fixed Rate and Gross Sales for the first Lease Year.
          Gross Sales shall mean all box office receipts, and receipts from sales of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant and returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions”. Commissions paid to agencies or other third parties for selling tickets and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar officer of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage
     
April 22, 1998   ROSEVILLE

4


 

Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of eighteen (18%) percent from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof.
      4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
      4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
      4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of ten (10%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
      5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay when due all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises.. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
          B) In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
     
May 7, 1997   ROSEVILLE

5


 

          C) Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against Landlord’s Buildings, if any.
      5.02 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
      5.03 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.03. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.03.
      5.04 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities consumed on the Entire Premises. Any utility improvements presently serving the Entire Premises shall be maintained, repaired and replaced by Tenant, at Tenant’s expense.
      5.05 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
      6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this
     
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Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
      6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises, Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) as well as any and all improvements on the Entire Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) including Builder’s Risk and earthquake to the extent of not less than 100% of the full replacement cost thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Upon written request, Tenant shall name Landlord and any parties requested by Landlord and the holder of the first mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Tenant in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
      6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
      6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay
     
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to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
      6.05 Insurance Money and Other Funds Held in Trust. All insurance money or proceeds received by the Tenant and/or Landlord shall be held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and Second, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
      6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVI hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Tenant and Landlord shall apply the proceeds of the insurance collected to the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Tenant and Landlord by the licensed architect or engineer in charge of the work. Any amounts payable to Tenant or any Affiliate of Tenant for work or services performed or materials provided as part of any such repair, replacement, restoration or rebuilding shall not exceed competitive rates for such services or materials and Tenant shall, upon request of Landlord, make available to Landlord and its representatives all books and records of Tenant relating to such work, services and materials. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Tenant or Landlord with respect to the damage or destruction involved, and not used, shall be and remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Tenant and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.
      6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
      6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended
     
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coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unleasable or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance earners may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
      7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto.. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained, which approval shall not be unreasonably withheld.
          B) Tenant shall at all times keep the Entire Premises, Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may, at its option, remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
      7.02 Repairs — Maintenance.
          Tenant shall, at its sole cost and expense, maintain and repair the Entire Premises and Tenant’s Building and all improvements on the Entire Premises including all exterior lighting and signs.
          Tenant shall commence all of the repairs and maintenance within 3 days after receiving notice thereof from Landlord (provided that in the case of an emergency Tenant shall commence such work immediately upon receiving notice) and shall be diligently completed in a good and workmanlike manner. Notwithstanding the foregoing, Landlord shall have the right and option (but not the obligation) to undertake any such repair, maintenance or other items, in which event Tenant shall reimburse Landlord for all of the costs thereof within 30 days after Landlord’s request therefor. If Tenant fails to reimburse Landlord within the 30 day period, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum until such payment has been made.
     
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ARTICLE VIII
ENVIRONMENTAL MATTERS
      8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
      8.2 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages,
     
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penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
      8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed
     
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such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
      8.04 Maintenance of Premises.
          A) Tenant at its sole cost and expense shall keep and maintain the Entire Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Entire Premises.
      8.05 Landlord’s Responsibilities.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises or any other portion of the Premises by Landlord, its agents, employees, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any
     
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applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials.
      8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
      8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
      9.01 Tenant Improvements.
          (A) Tenant at its sole cost and expense shall complete all the required on-site and off-site improvements, including all signs, required for the development of the Entire Premises. In addition Tenant shall construct a motion picture theater building on the Premises containing approximately fifty-four thousand eight hundred sixty (54,860) square feet with sixteen auditoriums.
          (B) Landlord agrees to provide Tenant with an improvement allowance of up to a maximum of Four Million Six Hundred Sixty-Three Thousand One Hundred Dollars ($4,663,100) $85 per square foot-(Tenant Allowance). Tenant shall pay any difference between the total Tenant Building and improvement cost less the Tenant Allowance. Landlord agrees that it shall pay to Tenant, or at Tenant’s direction, to Tenant’s contractor, within fifteen (15) days following Landlord’s receipt of conditional lien waivers signed by its contractor, in form reasonably sufficient to waive lien rights in Sacramento County, California, an amount equal to the Tenant Allowance multiplied by the percentage of work completed as of the date of the lien waivers, less any installments of Tenant Allowance already paid. If the total contract for Tenant’s Work exceeds Tenant’s Allowance, Landlord shall only be required to pay its pro-rata share which shall be the ratio of Tenant’s Allowance to the total of Tenant’s Work. If Landlord disputes any portion of the request for payment by Tenant due to faulty or incomplete work, then Landlord shall withhold a sum which, in Landlord’s opinion would be required to correct or complete the disputed work. In this event, Landlord shall submit a written “punch list” to Tenant. In addition Landlord agrees to provide Tenant with a Site Allowance up to a maximum of One Million Seven Hundred Sixty Eight Four Hundred Forty Eight ($1,768,448) Dollars.
     
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     Anything above to the contrary notwithstanding, Landlord shall no obligation to pay any portion of the construction allowance if Tenant is then in default of any of the terms and provisions of this Lease.
      9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees. Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of by Tenant of Tenant’s Building or Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
      9.03 Permits: Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
      9.04 Ownership of Improvements.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein excluding moveable trade fixtures and personal property of Tenant, shall become the property of Landlord, unless and to the extent Tenant elects to remove any of the foregoing pursuant to Section 9.04 (B).
          B) Tenant shall have the right to remove all trade fixtures, equipment and furnishings, including seats, carpets, draperies, screen, sound reproducing equipment, projection equipment, furniture and lobby frames from the Premises without notice to Landlord provided, Tenant replaces all items removed with items of similar quality or better quality and the foregoing shall remain the property of the Tenant at the expiration or earlier termination of the Lease. In addition, Landlord shall have the right if Landlord so elects by giving written notice to Tenant of such election at any time before ninety (90) days prior to the end of the Term (including any renewals or extensions) hereof to remove at Tenant’s sole cost any other Improvements and all additions, alterations and improvements thereto or replacements thereof erected, constructed, or installed on the Premises. The removal of any of the foregoing shall be completed within thirty (30) days following the end of the Term hereof (including any renewals thereof or any earlier termination permitted by this Lease.
      9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     
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      10.1 Landlord’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Tenant, its agents, employees, licensees, invitees or contractors on the Leased Premises, occurring within the Leased Premises or (ii) arising from Tenant’s or its employees use of the Leased Premises.
      10.2 Tenant’s Indemnity. Except to the extent attributable to the intentional and negligent acts or omissions of Tenant and its agents, employees, tenants, licensees and contractors, Landlord shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant (and its successors, assigns and subletees), and all of their directors, officers, employees and agents, hereinafter referred to as “Tenant Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Landlord, its agents, employees, licensees, invitees on the Entire Premises or contractors, occurring within the Entire Premises, or (ii) arising from Landlord’s use of the Entire Premises.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
      11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease. Landlord shall be entitled to all rent from any assignment or sublease in excess of the Annual Fixed Rent set forth in this Lease.
          B) Any assignment of this Lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without Landlord’s consent, assign this Lease (a) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (b) to Tenant’s Parent Corporation, or (e) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, provided that such corporation duly and validly then guarantees the performance of the obligations under this Lease.
      11.02 Notice to Landlord. Tenant shall give notice to Landlord in writing of any assignment of the Lease ten (10) days prior to such event.
     
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ARTICLE XII
MORTGAGE SUBORDINATION
      12.01 Existing Mortgages . If there is an existing mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises or in any other part of the Entire Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
      12.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIII
CONDEMNATION — EMINENT DOMAIN
      13.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to the Entire Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Entire Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
     
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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
      13.02 Notice to Other Party . The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
      13.03 Total Taking — Effect on Rent and Term . On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
      13.04 Distribution of Award for Taking . On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any for the Fair Market Value of all Land, buildings and other improvements on the Entire Premises and all Severance Damages.
          B) To Tenant, the amount awarded, if any, for loss of goodwill, lost business, lost profits, relocation expenses and fixtures; and
          C) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 13.04 out of amounts awarded by the governmental body taking the Premises.
      13.05 Partial Taking — Rent Adjustments . On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises or the parking taken bears to the total area of the Premises or the parking.
      13.06 Partial Taking — Option to Terminate . Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty-three percent (33%) of the Building or thirty-three (33%) of the parking is taken by condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
      13.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses, fixtures and relocation expenses against the acquiring governmental Agency.
     
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ARTICLE XIV
DEFAULT
      14.01 Tenant’s Default . The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Fixed Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease; provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
      14.02 Landlord’s Remedies Cumulative . Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 14.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
     
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               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 14.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 14.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 14.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 14.02(C), Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 14.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at ten percent (10%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
      14.03 Landlord’s Default .
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the
     
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expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
      14.04 Waiver of Redemption . Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
      14.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 14.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party, which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. Arbitration shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association.
      14.06 Attornevs’ Fees . Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XV
REPRESENTATIONS AND WARRANTIES
      15.01 Landlord’s Representations and Warranties . Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
     
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          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
      15.02 Tenant’s Representations and Warranties . Tenant represents and warrants:
          A) Tenant is a Delaware corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVI
DAMAGE OR DESTRUCTION
      16.01 Repairs. Alterations and Further Improvements .
          In the event of damage to or destruction of the Tenant’s Building or any Improvements on or to the Premises whether or not covered by the insurance described in Article 6: Tenant shall effect, at Tenant’s sole cost and Landlord and Tenant agree that the funds derived from insurance acquired pursuant to Article 6 shall be made available to effect, such repair and reconstruction of the structure or improvement so damaged or destroyed to substantially its condition prior to said damage or destruction with such alterations thereto as Tenant shall reasonably determine prudent or valuable under the circumstances, including any changes required to comply with applicable law, with the then prevailing construction practices applicable to the Premises. Tenant shall be responsible for all costs in excess of Insurance proceeds available All such work shall be carried on in accordance with Drawings prepared by a licensed architect or architects approved by
     
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Landlord (acting reasonably) if such an architect is reasonably required, given the scope and nature of the work. In disbursing insurance proceeds the Tenant and Landlord may rely upon and accept the certified determinations of such architect with respect to estimated costs, awarding of contracts, sufficiency of bonds, progress of construction, interpretation of plans and specifications, compliance with same, and completion of construction. No extras or changes in Drawings shall be made by Tenant without first giving written notice of such changes to Landlord and obtaining Landlord’s approval thereof (which approval shall not be unreasonably withheld or delayed).
          If such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto, the Lease shall Terminate and any insurance proceeds shall become the property of Landlord.
      16.02 Prompt Repair . If Tenant, pursuant to the terms hereof, is obligated or elects to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided and subject to the provisions of subparagraph (B) of Section 16.01), and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials alter due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
      16.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall thereafter not abate but continue for as long as and to the extent such Improvements are untenantable.
      16.04 Damage During Last Two (2) Years of Term . If there occurs during the last two (2) years of the Initial Term or at any time during a Renewal Period damage or destruction to any Improvement on or in the Premises and the costs of repairing, restoring, replacing or rebuilding the same exceed Five Thousand Dollars ($500,000), then Tenant may elect to terminate the Term and, in such event, Tenant shall give notice to Landlord of its election within sixty (60) days after its determination of the amount of damage, and the Term shall thereupon terminate as of the date of such notice and all insurance proceeds shall become the property of Landlord.
ARTICLE XVII
MISCELLANEOUS
      17.01 Limitation on Liability . The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Entire Premises and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Entire Premises.
      17.02 Brokers. Landlord and Tenant each represent to the other that neither has any obligation to any broker or finder in connection with this transaction, and that no fee or commission is due any broker, finder, or similar person in connection herewith. Landlord and Tenant each indemnifies the other and agrees to hold the other harmless from and against any and all claims, demands, liabilities, lawsuits, costs, and expenses (including reasonable attorneys’ fees) for any fee or commission due to any other broker, finder, or similar person in connection with this transaction and arising out of the act of the indemnifying party.
     
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      17.03 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
      17.04 Severability . In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
      17.05 Governing Law . This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
      17.06 Terminology . All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
      17.07 Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
      17.08 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
      17.09 Captions . Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
      17.10 Notices to Landlord and Tenant .
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 17.11 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 17.11 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days
     
May 7, 1997   ROSEVILLE

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after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent..
      17.11 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord :   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn.: Real Estate Department
 
       
 
  To Tenant :   Century Theatres, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
      17.12 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
      17.13 Sale or Transfer of Premises . Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
      17.14 Force Majeure . In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, dots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
      17.15 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default
     
May 7, 1997   ROSEVILLE

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hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
      17.16 Estoppel Certificate . Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
      17.17 Number and Gender . Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
      17.18 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
      17.19 Mechanics Liens . Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
      17.20 Relationship of Parties . Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
      17.21 Time of the Essence . Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
      17.22 Facsimile Copies . Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     
May 7, 1997   ROSEVILLE

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      17.23 Anti-Merger . The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
          Executed as of the date first written above.
       
TENANT:
   
 
  CENTURY THEATRES, INC.,
 
  a Delaware Corporation
 
   
 
 
By: /s/ Joseph Syufy
 
  Print Name: Joseph Syufy
 
  Title: Senior Executive V.P.
 
   
LANDLORD:
   
 
   
 
  SYUFY ENTERPRISES
 
  a California Limited Partnership
 
   
 
 
By: /s/ Raymond Syufy
 
  Print Name: Raymond Syufy
 
  Title: GP
     
May 7, 1997   ROSEVILLE

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EXHIBIT 10.29(b)
First Amendment to Lease
      This First Amendment to Lease (this “ Amendment ”) dated April 15, 2005 is executed by and between Syufy Enterprises , L.P., a California limited partnership (“ Landlord ”), and Century Theatres, Inc., a California corporation (“Tenant”).
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE)”), entered into a lease dated September 3, 1996 (the “ Lease ”) for a motion picture building and related parking (the “ Premises ”) located at 1555 Eureka Road, Roseville, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore , the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01(a) of the Lease, the following is hereby inserted:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development” ) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
Century 14 — Roseville, CA

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     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “ FF&E ”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment
Century 14 — Roseville, CA

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or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century 14 — Roseville, CA

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      In Witness Whereof , Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
a California limited partnership
“Landlord”
      Century Theatres, Inc .,
a California corporation
“Tenant”
   
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century 14 — Roseville, CA

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EXHIBIT 10.29(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Enterprises , L.P., a California limited partnership (“Landlord”), and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)”), entered into a lease dated September 3, 1996, as amended by that certain First Amendment to Lease dated April 15, 2005 (the “Lease” ) for a motion picture building and related parking (the “Premises” ) located at 1555 Eureka Road, Roseville, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore , the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this
Century 14 — Roseville, CA

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Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof , Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
a California limited partnership
“Landlord”
      Century Theatres, Inc .,
a California corporation
“Tenant”
   
 
           
/s/ Raymond Syufy
      /s/ Joseph Syufy    
 
           
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century 14 — Roseville, CA

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EXHIBIT 10.29(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(Roseville)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord and Century Theatres, Inc., a Delaware corporation (“Original Tenant”), entered into a certain Lease dated as of September 3, 1996 (the “Original Lease”) for certain premises located in Roseville, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of April 15, 2005 (the “First Amendment”), and (ii) that certain Second Amendment to Lease dated as of September 29, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
      1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
      2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
      3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on***            and rather than ***           Renewal Terms of ***           each (as

 


 

provided in the Lease), Tenant shall have the option to extend the Initial Term for ***           consecutive Renewal Terms of***           each, followed by ***          additional and final Renewal Term of***
      4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the Sacramento, California metropolitan area typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
      5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.
      6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:

 


 

     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in subsection (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
      7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior

 


 

written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
      8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
      9.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
      10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased

 


 

Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
      11.   Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or

 


 

  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
      12.   Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment hereof.
      13.   Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications

 


 

and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
      14.   Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.

 


 

  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
      15.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
      16.  No Obligation To Continuously Operate. Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
      17.   Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
18. California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord

 


 

has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
      19.   Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (A) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (B) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (C) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (D) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (E) for any other sums due.”
      20.   Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses

 


 

set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention: President
         
 
  with a copy to:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
203 North LaSalle
Suite 1900
Chicago, IL 60601
Attention: David Sickle, Esq.
         
 
  To Tenant:   Century Theatres, Inc.
c/o Cinemark, Inc.
3900 Dallas Parkway
Suite 500
Piano, TX 75093

 


 

Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
      21.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
      22.  Prior Amendments. The First Amendment and the Second Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such First Amendment and Second Amendment in their entirety.
      23.   Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
           
    Name: Joseph Syufy    
    Title: Chief Executive Officer    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond Syufy    
 
           
    Name: Raymond Syufy    
    Title: Chief Executive Officer    

 

 

EXHIBIT 10.30(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII: Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       
  ii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  
  iii

 


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
Exhibit A            Description of Premises
    A-l  
Exhibit B            Site Plan of Premises
    B-l  
Exhibit C            Form of Memorandum
    C-l  
Exhibit D            Guaranty of Lease
    D-l  
  iv

 


 

LEASE
          THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF NEVADA, INC., a Nevada corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
          Landlord owns the fee interest in Land located in the State of Nevada as set forth in Exhibit A.
          Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
          NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
          1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Premises.
               EXHIBIT B — a site plan of the Premises.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
          1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1,1995.
               The term “Effective Date” shall mean October 1,1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1,1995.
               The term “Initial Term” is defined in Section 2.02 herein.

1


 

               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean***
               The term “Option Periods” shall mean ***      successive separate periods of ***      each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

          The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***      consecutive additional periods of ***      each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
          (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted all of Landlord’s rights under the Rancho Santa Fe Center CC&R’s. Tenant shall be responsible for all costs pertaining to the Rancho Santa Fe Center CC&R’s.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***      The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***      Lease Year and on the first day of each : ***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Las Vegas Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***      greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a dairy basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
     Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
               First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage of destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (With counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary; and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (e) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal properly damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parries for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate often percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however . Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the properly of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof shall become the property of Landlord and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the properly of Tenant.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Tenant at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord, and
          F) To Landlord, any balance

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant.
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively, they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the rent of other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in feet terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2)  As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02© shall not relieve Tenant from the payment of any sum due to a Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award The parties may establish the scope of discovery by agreement If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and me Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed); Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining, the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of Nevada and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Attn: Real Estate Department
 
   
To Tenant:
  Century Theatres of Nevada, Inc.
 
  150 Golden Gate Avenue
 
  San Francisco, CA 94102
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that parry’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
         
  CENTURY THEATRES OF NEVADA, INC., a Nevada Corporation
 
 
  By:   /s/ Joseph Syufy    
  Print Name: Joseph Syufy   
  Title:     V.P.   
 
LANDLORD:
         
  SYUFY ENTERPRISES
a California Limited Partnership
 
 
  By:   /s/ Raymond W. Syufy    
  Print Name:    Raymond W. Syufy   
  Title   G.P.   
 

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EXHIBIT 10.30(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of Nevada, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”), known as the Rancho Santa Fe Theater, located in Las Vegas, Nevada; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of Nevada, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of Nevada, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Las Vegas” is hereby deleted and in its place is inserted the “Los Angeles-Orange County Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***      of the
     Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city
Rancho Santa Fe Las Vegas

 


 

admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VTL.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
          If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
Rancho Santa Fe Las Vegas

 


 

     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
“Landlord”
  CENTURY THEATRES, INC.
“Tenant”
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
 
   
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
[STAMP]
Rancho Santa Fe Las Vegas

 

 

EXHIBIT 10.30(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
SECOND AMENDMENT TO LEASE
(Rancho Santa Fe)
      THIS SECOND AMENDMENT TO LEASE (this “Amendment”) is entered into as of September 30, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord and Century Theatres of Nevada, Inc., a Nevada corporation (“Original Tenant”), entered into a certain Lease dated as of September 30,1995 (the “Original Lease”), for certain premises located at the “Rancho Santa Fe” project in Las Vegas, Nevada.
     B. The Original Lease has been previously amended by that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”); the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE , for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of August 7, 2006 (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.  Initial Term of Lease . Notwithstanding anything to the contrary in the Lease, the Initial Term of the Lease shall expire on ***
     4.  Elimination of Extension Options . Section 2.03 of the Lease shall be deemed deleted and shall be of no further force or effect. Tenant shall not have any right or option to

 


 

extend the term of the Lease beyond the Initial Term (as amended above) and all references in the Lease to the “Renewal Terms” shall be deemed deleted and of no further force or effect.
     5.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: any lawful retail or retail/entertainment use, and/or for surface parking; provided , however , in no event shall Tenant be permitted to operate the Leased Premises as a motion picture theater complex, or otherwise for the commercial exhibition of motion pictures, films, videos or images including, without limitation, so-called specialty theaters (e.g., I-Max, I-Works and Showscan-type theaters, and ride/simulator theaters), or for any use which violates any recorded restrictions affecting the Premises.
     6.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     7.  Surrender and Demolition . The obligation of Tenant to demolish improvements on the Premises pursuant to the final sentence of Section 15.02(E) of the Lease (Paragraph G. of the First Amendment) shall apply (if at all) only to alterations and/or improvements (if any) that are installed upon the Premises by Tenant after the Effective Date.
     8.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day

 


 

after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent.
          (c) Addresses for Notices to Landlord and Tenant.
          Notices are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: President
     
with a copy to:
  Syufy Enterprises, L.P.
 
  150 Pelican Way
 
  San Rafael, California 94901
 
  Attention: General Counsel
 
   
and a copy to:
  DLA Piper
 
  203 North LaSalle
 
  Suite 1900
 
  Chicago, IL 60601
 
  Attention: David Sickle, Esq.
     
To Tenant:
  Century Theatres, Inc.
 
  c/o Cinemark, Inc.
 
  3900 Dallas Parkway
 
  Suite 500
 
  Plano, TX 75093
 
  Attention: Legal Department
          Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     9.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby; and any and all references to “Syufy Enterprises, L.P., a California limited partnership” (with or without L.P. in the name and whether or not limited partnership is capitalized) shall be understood to mean Landlord. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     10.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further

 


 

amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

      IN WITNESS WHEREOF, Landlord, and Tenant have executed this Amendment as of the date herein above provided.
Landlord :
         
  SYUFY ENTERPRISES, L.P ., a California limited partnership    
 
  By:   /s/ Joseph Syufy    
  Name:        
  Title:         
 
Tenant :
         
  CENTURY THEATRES, INC ., a California corporation
 
 
  By:   /s/ Raymond W. Syufy    
  Name:        
  Title:        
 

 

 

EXHIBIT 10.31(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
Recitals
    l  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Proration of Taxes
    6  
5.03 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

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LEASE
CENTURY THEATRES
Table of Contents
         
        Page No.
Exhibit A
  Description of Premises   A-1
Exhibit B
  Site Plan of Premises   B-1
Exhibit C
  Form of Memorandum   C-1
Exhibit D
  Guaranty of Lease   D-1

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LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC. a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Premises.
               EXHIBIT B — a site plan of the Premises.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
      1.02. Definitions .
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.

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               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean ***       successive separate periods of ***       each.
               The term “Percentage Rate” shall mean***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises .
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***       thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term .
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***      consecutive additional periods of ***      each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party, shall at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of***       The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***       after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the ***       Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***       Lease Year and on the first day of each ***       Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco-Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***       greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent . In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***      of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent. Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

5


 

          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes . If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions .
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes . Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes . During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance . During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance . During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance . The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance . If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof, and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance . In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds . At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds . Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery . Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes .
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance . Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition . For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant; its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises; damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims; attorneys’ fees; consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises .
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity .
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf, of or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection . Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination .
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs .
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless . Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership .
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration, or earlier termination of this Lease, the Improvements and all additions, alterations and implements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and person property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting .
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord . Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages .
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking . On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect
     15.02 Landlord’s Remedies Cumulative . Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance . Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination . Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession . No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions . As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award”, as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver , If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute . The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to § 1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees . Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have me right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties . Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs. Alterations and Further Improvements .
          A) Tenant’s Obligation to Repair . If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%) . If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair . If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability . The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability . In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology . All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises . Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof and the withholding of rent or other charges payable by Tenant to Landlord hereunder,in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure . In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant
     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate . Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender . Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT :
CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
By: /s/ Joseph Syufy                     
Print Name: Joseph Syufy
Title: V.P.
LANDLORD :
SYUFY ENTERPRISES
a California Limited Partnership
By: /s/ Raymond W. Syufy                     
Print Name: Raymond W. Syufy
Title: G.P.

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EXHIBIT 10.31(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This first amendment to lease dated October 1, 1996 is executed by and between Syufy Enterprises, a California Limited Partnership, hereinafter called “Landlord” and Century Theatres Inc., a Delaware corporation, hereinafter called “Tenant”.
WITNESSETH:
     WHEREAS, Syufy Enterprises and Century Theatres of California, Inc. (a wholly owned subsidiary of Century Theatres, Inc.) entered into an Indenture of Lease on September 30, 1995, hereinafter referred to as the “Lease”, for the Century Ventura 8 Theatre, Ventura, California, and
     WHEREAS, the parties hereto desire to amend said Lease as hereinafter provided,
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
     1. The Leased Premises shall be increased by 2.58 acres as set forth in the attached Exhibit A to permit Tenant to add eight auditoriums and expand the existing theatre building by a total of 22,066 square feet and to provide additional parking for the Theatre.
     2. Landlord shall amend the existing REA to incorporate the land set forth in Exhibit A into the REA.
     3. Tenant shall be responsible for all construction costs for the parking and site work improvements. Landlord shall provide Tenant an allowance of $599,225 towards the site work improvements.
     3. Tenant shall be responsible for all construction costs for the expanded building and new auditoriums. Landlord shall provide Tenant an allowance of Eight five ($85.00) dollars per square foot or a total of $1,875,610 toward the Tenant Improvements.
     4. As consideration Tenant shall pay as additional base rent the amount of ***         per year commencing the date Tenant’s work is complete and the new auditoriums are open for business. The revised Base Rent or Minimum Monthly Rent as set forth in the lease shall increase by ***       and the new Base Rent under the lease shall be ***       per month.
     Executed as of the date first written above.
         
Century Theatres, Inc.
      Syufy Enterprises
 
       
/s/ Joseph Syufy
      /s/ Raymond W. Syufy
 
       
Joseph Syufy, Senior Executive Vice President
      Raymond W. Syufy, Genl Ptr

 

 

EXHIBIT 10.31(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
SECOND AMENDMENT TO LEASE
     This Second Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located on Elba Street in Ventura, California; and
     WHEREAS, Landlord and Tenant entered into that certain First Amendment to Lease dated October 1, 1996; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to further amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be further amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco-Oakland-San Jose Average” is hereby deleted and in its place is inserted the “Los Angeles-Orange County Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***        of the
     Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending

Stadium 16 Ventura


 

machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”

Stadium 16 Ventura


 

      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This Second Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
         
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond W. Syufy
 
Raymond W. Syufy
  /s/ Joseph Syufy
 
Joseph Syufy
   
Chief Executive Officer
  President    

Stadium 16 Ventura [STAMP]

 

EXHIBIT 10.31(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “ Amendment ”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”), and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated October 1, 1996, between Syufy Enterprises, L.P. and Century Theatres, Inc., a Delaware corporation (“ Century Theatres (DE) ”), and as further amended by that certain Second Amendment to Lease, dated September 1, 2000, between Syufy Enterprises, L.P. and Century Theatres (DE) (as amended, the “ Lease ”), for a motion picture building and related parking (the “ Premises ”) located at 2875 Elba Street, Elba, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres (DE) succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. The second sentence of Section 2.01(a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “ Development ”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that

1

Century Stadium 16 — Ventura, CA


 

are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “ FF&E ”) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Compliance With Agreements
     Tenant acknowledges receipt of a copy of (i) that certain Amended and Restated Reciprocal Parking and Maintenance Agreement, dated as of May 7, 1998 and recorded as document number 98-198927 in the Official Records of Ventura County, California (the “ Official Records ”), amending that certain Reciprocal Parking and Maintenance Agreement, dated as of July 3, 1985 (collectively, the “ REA ”), and (ii) that certain Covenants Running with the Land dated June 8, 1998 and recorded as document number 98-198928 in the Official Records (the “ Covenants ”), and Tenant covenants and agrees to abide by all terms and conditions contained in the REA and the Covenants, including, without limitation, those related to theater food sales and game access restrictions. Tenant shall defend, indemnify and hold harmless Landlord from

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Century Stadium 16 — Ventura, CA


 

any and all claims, demands, losses or judgments arising out of or related the REA, the Covenants, and their application to Tenant’s operations.
D. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]

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Century Stadium 16 — Ventura, CA


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer

4

Century Stadium 16 — Ventura, CA

 

EXHIBIT 10.31(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Ventura 16)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises (the “Original Landlord”)) and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Ventura, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of October 1, 1996 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of September 1, 2000 (the “Second Amendment”), and (iii) that certain Third Amendment to Lease dated as of April 15, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the

 


 

Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***       and rather than ***       Renewal Terms of ***       each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***       consecutive Renewal Terms of ***       each, followed by ***       additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Ventura typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.

 


 

     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair . If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

 


 

not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l” .
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:

 


 

     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
     (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;

 


 

     (ii) Attributable to the annual inflationary increases in real estate taxes; or
     (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make nonstructural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications

 


 

and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.

 


 

  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     16.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     17.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     18.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord

 


 

has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     19.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
(5) for any other sums due.”
     20.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either

 


 

party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
             
    To Landlord:   Syufy Enterprises, L.P.
        150 Pelican Way
        San Rafael, California 94901
        Attention: President
 
           
 
  with a copy to:       Syufy Enterprises, L.P.
 
          150 Pelican Way
 
          San Rafael, California 94901
 
          Attention: General Counsel
 
           
 
  and a copy to:       DLA Piper
 
          203 North LaSalle
 
          Suite 1900
 
          Chicago, IL 60601
 
          Attention: David Sickle, Esq.
 
           
    To Tenant:   Century Theatres, Inc.

 


 

c/o Cinemark, Inc.
3900 Dallas Parkway
Suite 500
Plano, TX 75093
Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     21.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     22.  Prior Amendments . All of the provisions of the Second Amendment and the Third Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A of the Second Amendment concerning the definition of Consumer Price Index, (ii) Paragraph E of the Second Amendment concerning the Indemnity and Hold Harmless and (iii) Paragraph C of the Third Amendment, regarding compliance with certain agreements.
     23.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

 


 

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
By: /s/ Joseph Syufy                     
Name:                              
Title:                                                
Tenant:
CENTURY THEATRES, INC., a California corporation
By: /s/ Raymond W. Syufy                     
Name:                               
Title:                                                  

 

 

EXHIBIT 10.32(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent / Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5 01 Impositions
    5  
5.02 Proration of Taxes
    6  
5.03 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

i


 

LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Indemnification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Parry
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
ARTICLE XV: Default

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti-Merger
    26  
 
       
Signature Page
    26  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.
Exhibit A Description of Premises
    A-1  
Exhibit B Site Plan of Premises
    B-1  
Exhibit C Form of Memorandum
    C-1  
Exhibit D Guaranty of Lease
    D-1  

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LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Premises.
               EXHIBIT B — a site plan of the Premises.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
     1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1,1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.

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               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean***
               The term “Option Periods” shall mean*** successive separate periods of***      each.
               The term “Percentage Rate” shall mean***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate***            thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***           consecutive additional periods of***          each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***          of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant shall be subject to and responsible for all costs and granted all rights to any and all agreements, including all Construction, Operation and Reciprocal Easement Agreements, covering the Premises.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***           .The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***           after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the***           Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the ***           Lease Year and on the first day of each ***           Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Las Vegas, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***           greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent. In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***           of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

6


 

contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however , Tenant shall be liable for attorneys fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or properly are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the properly of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all properly therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
     C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to § 1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs. Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

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reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

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Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn: Real Estate Department
 
       
 
       
 
  To Tenant:   Century Theatres of California, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, hi the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

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shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

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stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
             
    CENTURY THEATRES OF CALIFORNIA, INC., a California Corporation  
 
           
 
  By:   /s/ Joseph Syufy    
 
           
    Print Name   Joseph Syufy    
    Title:   V.P.    
 
           
LANDLORD:
           
 
           
    SYUFY ENTERPRISES    
    a California Limited Partnership    
 
           
 
  By:   /s/ Raymond W. Syufy    
    Print Name:   Raymond W. Syufy    
    Title:   G.P.    

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EXHIBIT 10.32(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in the Northridge Mall in Salinas, California; and
     WHEREAS, Century Theatres, Inc., a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Las Vegas” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***           of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter
Northridge Salinas

 


 

imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01(A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9.02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01 (C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01 (B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
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     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
             
SYUFY ENTERPRISES, L.P.
      CENTURY THEATRES, INC.    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond W. Syufy
      /s/ Joseph Syufy    
             
Raymond W. Syufy
      Joseph Syufy    
Chief Executive Officer
      President    
[STAMP]
Northridgc Salinas

 

 

EXHIBIT 10.32(c)
SECOND AMENDMENT TO LEASE
     This Second Amendment to Lease dated October 1, 2001 is executed by and between Syufy Enterprises, a California limited partnership, hereinafter called “Landlord,” and Century Theatres, Inc., a Delaware corporation, hereinafter called “Tenant.”
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc., entered into an Indenture of Lease on September 30, 1995, hereinafter referred to as the “Lease,” for land and a theatre building located at the Northridge Mall in Salinas, California, and
     WHEREAS, Landlord and Tenant entered into that certain First Amendment to Lease dated September 1, 2000, and
     WHEREAS, the parties hereto desire to amend said Lease as hereinafter provided,
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
     1. Tenant shall be allowed to demolish the existing Theatre Building and Improvements. Tenant shall be responsible for all costs of the demolition and removal of debris.
     2. Tenant shall be allowed to re-develop the Entire Premises in order to construct a new multi-screen theater complex and provide for surface parking in connection therewith. Tenant shall be responsible for all costs to re-develop the property for Tenant’s use, and shall be responsible to satisfy, and indemnify Landlord for, all obligations related to the entitlements and approvals for the project, as well as those obligations arising from the Third Supplement and Amendment to and Restatement of Construction, Operation and Reciprocal Easement Agreement dated July 3, 1979.
     3. The term “Leased Premises” as defined in Section 1.02 — Definitions in Article I of the Lease shall be deleted in its entirety and replaced with the following definition:
     The term “Leased Premises” shall mean Tenant’s Building and the land adjacent thereto as described in Exhibit A and as shown on Exhibit B, and the rights, easements and privileges granted to Tenant in the Lease.
     4. Section 2.01 of the Lease shall be deleted in its entirety and replaced with the following:
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     Landlord leases to Tenant and Tenant leases from Landlord, the Entire Premises, upon the terms and conditions contained herein.
     5. Section 14.06 Partial Taking — Option to Terminate shall be amended by deleting the phrase “if more than thirty percent (30%) of the Building or”.
     6. Section 7.01 (C) of the Lease shall be deleted in its entirety.
     7. Section 9.01 of the Lease shall be deleted in its entirety.
     8. Section 9.04 (B) of the Lease shall be deleted in its entirety.
     9. This Amendment shall be effective on the date first set forth above.
   10. All other conditions and provisions of the Lease shall remain in effect.
     Executed as of the date first written above.
                     
SYUFY ENTERPRISES, L.P.       CENTURY THEATRES, INC.    
 
                   
/s/ Alan Steuer       /s/ Raymond W. Syufy    
             
By:
  Alan Steuer       By:   Raymond W. Syufy    
Its:
  CFO       Its:   CFO    
[STAMP]
Northridge Salinas, CA

 

 

EXHIBIT 10.32(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(Northridge)
      THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Salinas, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), and (ii) Second Amendment to Lease dated as of October 1, 2005 (the “Second Amendment” the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.   Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.   Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.   Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***           and rather than ***            Renewal Terms of ***           each (as

 


 

provided in the Lease), Tenant shall have the option to extend the Initial Term for ***           consecutive Renewal Terms of ***           each, followed by ***           additional and final Renewal Term of ***
     4.   Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Monterey typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.   Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
     6.   Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease,

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then Tenant shall repair the damage and restore the Leased Premises in accordance with this Section, except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in subsection (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.   Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, its is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding

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stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.   Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     9.   Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.   Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines

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and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.   Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
  (i)   Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
 
  (ii)   Attributable to the annual inflationary increases in real estate taxes; or
 
  (iii)   Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.

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During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     13.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with

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Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
 
  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.

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  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     16.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  California Remedies. Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     18.  Termination of Lease and Lessee’s Right to Possession. Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and

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again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     19.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally

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delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
         
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601 94901
 
      Attention: David Sickle, Esq.
         
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Piano, TX 75093
 
      Attention: Legal Department

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     Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     20.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     21.  Prior Amendments. All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall replace and restate such Second Amendment and Third Amendment in their entirety.
     22.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond W. Syufy    
 
           
 
  Name:        
 
           
 
  Title:        
 
           

 

EXHIBIT 10.33(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
 
       
Recitals
    1  
 
       
ARTICLE I: Definitions — Exhibits
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    2  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title
    3  
 
       
ARTICLE III: Use of Premises
       
3.01 Use
    4  
 
       
ARTICLE IV: Rent
       
4.01 Base Rent /Minimum Monthly Rent
    4  
4.02 Percentage Rent
    4  
4.03 Rent Payments
    5  
4.04 Place for Payment of Rent
    5  
4.05 Late Payment of Rent
    5  
 
       
ARTICLE V: Taxes, Assessments and Utilities
       
5.01 Impositions
    5  
5.02 Proration of Taxes
    6  
5.03 Exceptions from Impositions; Charges in Lieu of Impositions
    6  
5.04 Contest of Taxes
    6  
5.05 Utilities
    7  
5.06 Personal Property Taxes
    7  
 
       
ARTICLE VI: Insurance
       
6.01 Acquisition of Insurance Policies
    7  
6.02 Types of Required Insurance
    7  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    8  
6.05 Insurance Money and Other Funds Held In Trust
    8  
6.06 Application or Proceeds of Physical Damage Insurance
    8  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    9  
 
       
ARTICLE VII: Maintenance, Repairs And Alterations
       
7.01 Alterations — Changes
    9  

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
 
       
7.02 Repairs — Maintenance
    10  
 
       
ARTICLE VIII: Environmental Matters
       
8.01 Definition
    10  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    10  
8.03 Remedial Work
    11  
8.04 Maintenance of Premises
    12  
8.05 Landlord’s Responsibilities and Tenant’s Indemnity
    12  
8.06 Landlord Inspection
    13  
8.07 Effect of Termination
    13  
 
       
ARTICLE IX: Improvements
       
9.01 Tenant’s Signs
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    14  
9.04 Ownership
    14  
9.05 Control
    15  
 
       
ARTICLE X: Indemnity
       
10.01 Identification
    15  
 
       
ARTICLE XI: Assignment and Subletting
       
11.01 Assignment and Subletting
    15  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII Encumbrance of Leasehold Estate
       
12.01 Leasehold Mortgages
    16  
 
       
ARTICLE XIII: Mortgage Subordination
       
13.01 Existing Mortgages
    16  
13.02 Future Mortgages
    16  
 
       
ARTICLE XIV: Condemnation — Eminent Domain
       
14.01 Definitions
    16  
14.02 Notice to Other Party
    17  
14.03 Total Taking — Effect on Rent and Term
    17  
14.04 Distribution of Award for Taking
    17  
14.05 Partial Taking — Rent Adjustments
    18  
14.06 Partial Taking — Option to Terminate
    18  
14.07 Separate Tenant’s Award
    18  
 
       
ARTICLE XV: Default
       

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LEASE
CENTURY THEATRES
Table of Contents
         
    Page No.  
 
       
15.01 Tenant’s Default
    18  
15.02 Landlord’s Remedies Cumulative
    18  
15.03 Landlord’s Default
    20  
15.04 Waiver of Redemption
    20  
15.05 Dispute Resolution
    20  
15.06 Attorney Fees
    21  
 
       
ARTICLE XVI: Representations and Warranties
       
16.01 Landlord’s Representations and Warranties
    21  
16.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVII: Damage or Destruction
       
17.01 Repairs, Alterations and Further Improvements
    22  
17.02 Prompt Repair
    22  
17.03 Rent Adjustment
    23  
 
       
ARTICLE XVIII: Miscellaneous
       
18.01 Limitation on Liability
    23  
18.02 Modification
    23  
18.03 Severability
    23  
18.04 Governing Law
    23  
18.05 Terminology
    23  
18.06 Counterparts
    23  
18.07 Binding Effect
    23  
18.08 Captions
    23  
18.09 Notice to Landlord and Tenant
    23  
18.10 Addresses for Notices to Landlord and Tenant
    24  
18.11 Entire Agreement
    24  
18.12 Sale or Transfer of Premises
    24  
18.13 Force Majeure
    25  
18.14 Waiver
    25  
18.15 Estoppel Certificate
    25  
18.16 Number and Gender
    25  
18.17 No Holding Over
    25  
18.18 Mechanics Liens
    25  
18.19 Relationship of Parties
    25  
18.20 Time of the Essence
    26  
18.21 Facsimile Copies
    26  
18.22 Anti - Merger
    26  
 
       
Signature Page
    26  

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LEASE

CENTURY THEATRES
Table of Contents
         
    Page No.  
 
       
Exhibit A            Description of Premises
    A-1  
Exhibit B            Site Plan of Premises
    B-1  
Exhibit C            Form of Memorandum
    C-1  
Exhibit D            Guaranty of Lease
    D-1  

iv


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUT PROPERTIES, INC., a Utah corporation with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF UTAH, INC., a Utah corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Building, Theatre Improvements and equipment located in the State of Utah as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
      1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Premises.
               EXHIBIT B — a site plan of the Premises.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
      1.02. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1,1995.
               The term “Effective Date” shall mean October 1,1995.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.

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               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean ***      successive separate periods of ***      each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the real property set forth in Exhibit A.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves the right to develop the unimproved portion of the Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

2


 

               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of***      each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***      of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title: Authority and Quiet Possession: Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

3


 

ARTICLE III

USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***       The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the***               Lease Year of the Term. The Minimum Monthly Rent shall be increased (but never decreased) on the first day of the***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, Salt Lake City, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than***                greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor Index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less than 100.
     4.02 Percentage Rent . In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***               of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

4


 

actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent . The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILlTIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord. any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto.
Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or

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contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (butt in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust . All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or approvement on or in the Premises as required as provided in Section 6.06 hereof, and third, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds snail be disposed of as provided in Section 6,06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.

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          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follow:
               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds . Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations— Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.

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          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249,5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170,1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinatedbyphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant tees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the

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environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnity, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenants Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work . In the event any investigation or monitoring of site conditions or any clean-up, containment,restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or(d) to maintain the Premises in a standard of environmental condition which presents no risk to

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safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible parry, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of,

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compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection . Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination .
          A) Upon termination of this Lease, Tenant shall advise landlord in writing whether or not, to the best of Tenant’s Knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.

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ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.
               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however , Tenant shall be liable for attorneys fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or, located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including movable trade fixtures and personal property of shall become the property of Landlord.

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          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease,
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification . Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued, and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $20,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.

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     11.02 Notice to Landlord . Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.
ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking’’ means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. “The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Talking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues of the date physical possession is taken by the condemnor.

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          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if, any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award Which will not reduce the amount ,which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.

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Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Talking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such

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re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; aid
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C(X)1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C(X)3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.

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          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
15.03 Landlord’s Default
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver, of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation . A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an

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absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representation and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage..
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the

22


 

reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment, This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or maybe sought
     18.03 Severability. In the event any term, covenant,condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of Utah and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease snail be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s

23


 

Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other addresses) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syut Properties
 
  150 Golden Gate Ave.
 
  San Francisco, CA 94102
 
  Att: Real Estate Department
 
To Tenant:
  Century Theatres of Utah, Inc.
 
  150 Golden Gate Avenue
 
  San Francisco, CA 94102
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord

24


 

shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent phus interest at 18%.
     18.19 Relationship of parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the

25


 

stockholder, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
TENANT:
             
    CENTURY THEATRES OF UTAH, INC.,    
    a California Corporation    
 
           
 
  By   /s/ Joseph Syufy    
 
           
    Print Name: Joseph Syufy    
    Title: V.P.    
LANDLORD:
             
    SYUT PROPERTIES, INC.    
    a California Limited Partnership    
 
           
 
  By:   /s/ Alan Steuer    
 
           
    Print Name: Alan Steure    
    Title: CFO    
26

 

 

EXHIBIT 10.33(b)
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated January 4, 1998 is executed by and between Syut Properties, Inc., a Utah corporation, hereinafter called “Landlord” and Century Theatres, Inc., a Delaware corporation, hereinafter called “Tenant”.
WITNESSETH:
     WHEREAS, Syut Properties, Inc., a Utah corporation, and Century Theatres of Utah, Inc., a Utah corporation, entered into an Indenture of Lease on September 30, 1995, hereinafter referred to as the “Lease”, for land and a theatre building located in Salt Lake City, Utah, and
     WHEREAS, Century Theatres, Inc., a Delaware corporation has succeeded Century Theatres of Utah, Inc. as Tenant, and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of Utah, Inc. as set forth in the Lease, and
     WHEREAS, the parties hereto desire to amend said Lease as hereinafter provided,
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
     1. Tenant shall be allowed to demolish the existing Theatre Building and Improvements. Tenant shall be responsible for all costs of the demolition and removal of debris.
     2. Tenant shall be allowed to develop the land to be used for parking. Tenant shall be responsible for all costs to develop the property for Tenant’s use.
     3. The term “Permitted Use” as defined in Section 1.02 — Definitions in Article I of the Lease shall be deleted in its entirety and replaced with the following definition:
     The term “Permitted Use” shall mean the construction and operation of a parking lot and/or a parking structure to be used for parking for patrons and/or employees of Tenant’s theatre which is located at 33 rd South Street and State Street, Salt Lake City, Utah.
     4. The term “Leased Premises” as defined in Section 1.02 — Definitions in Article I of the Lease shall be deleted in its entirety and replaced with the following definition:
     The term “Leased Premises” shall mean the land as set forth in Exhibit A and the rights, easements and privileges granted to Tenant in this Lease.

 


 

     5. Section 2.01 of the Lease shall be deleted in its entirety and replaced with the following:
     Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
     6. Section 14.06 Partial Taking — Option to Terminate shall be amended by deleting the phrase “if more than thirty percent (30%) of the Building or”.
     7. Section 4.02 of the Lease shall be deleted in its entirety.
     8. Section 7.01 (C) of the Lease shall be deleted in its entirety.
     9. Section 9.01 of the Lease shall be deleted in its entirety.
     10. Section 9.04 (B) of the Lease shall be deleted in its entirety.
     11. Section 7.02 of the Lease shall be amended by deleting the phrase “for a building of like kind and place.”
     12. This Amendment shall be effective January 4, 1998.
     13. All other conditions and provisions of the Lease shall remain in effect.
     Executed as of the date first written above.
         
SYUT PROPERTIES, INC.
  CENTURY THEATRES, INC.    
 
       
/s/ Alan Steuer
  /s/ Raymond Syufy    
 
By: ALAN STEUER
 
 
By: RAYMOND SYUFY
   
Its: CHIEF FINANCIAL OFFICER
  Its: CHIEF EXECUTIVE OFFICER    

 

 

EXHIBIT 10.33(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
SECOND AMENDMENT TO LEASE
     This Second Amendment to Lease dated September 1, 2000 is executed by and between Syut Properties, Inc. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of Utah, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in South Salt Lake City, Utah; and
     WHEREAS, Landlord and Tenant entered into that certain First Amendment to Lease dated January 4, 1998; and
     WHEREAS, the parties desire now to further amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be further amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to “Salt Lake City” is hereby deleted and in its place is inserted “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than***      of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions”
Salt Lake

 


 

including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII”
      D. Alterations
     The last sentence of Section 7.01 (A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9,02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$20,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
Salt Lake

 


 

     This Second Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
         
SYUT PROPERTIES, INC.
  CENTURY THEATRES, INC.    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond W. Syufy
  /s/ Joseph Syufy    
 
Raymond W. Syufy
 
 
Joseph Syufy
   
Chief Executive Officer
  President    
[STAMP]
Salt Lake

 

 

EXHIBIT 10.33(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between syut properties, inc., a Utah corporation ( “Landlord” ), and Century Theatres, Inc. , a California corporation ( “Tenant” ).
Witnesseth:
      Whereas, Landlord and Century Theatres of Utah, Inc. entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated January 4, 1998, between Syut Properties, Inc. and Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”) , and as further amended by that certain Second Amendment to Lease, dated September 1, 2000, between Syut Properties, Inc. and Century Theatres (DE) (as amended, the “Lease” ), for a motion picture building parking area (the “Premises” ) located at 3225 South 2nd East Street, Salt Lake City, Utah; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres (DE) succeeded Century Theatres of Utah, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of Utah, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. The second sentence of Section 2.01 (a) of the Lease is hereby deleted in its entirety and replaced with the following:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises.
 
1 Century 16 – Salt Lake City, UT

 


 

     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
 
2 Century 16 – Salt Lake City, UT

 


 

     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
     
  3 Century 16 – Salt Lake City, UT


 

      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Properties, Inc.,
  Century Theatres, Inc.,    
a Utah corporation
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
     
  4 Century 16 – Salt Lake City, UT

 

 

EXHIBIT 10.33(e)
Fourth Amendment to Lease
      This Fourth Amendment to Lease (this “Amendment” ) dated April 15, 2005 is executed by and between Syufy Properties, Inc., a California corporation (“Landlord”), and Century Theatres, Inc., a California corporation ( “Tenant” ).
Witnesseth:
      Whereas , Landlord and Century Theatres of Utah, Inc. entered into a lease dated September 30,1995, as amended by that certain First Amendment to Lease, dated January 4, 1998, between Syut Properties, Inc. and Century Theatres, Inc., a Delaware corporation ( “Century Theatres (DE)”), and as further amended by that certain Second Amendment to Lease, dated September 1, 2000, between Syut Properties, Inc. and Century Theatres (DE), as further amended by that certain Third Amendment to Lease dated April 15, 2005 between Syut Properties, Inc. and Century Theatres, Inc., a California corporation (as amended, the “Lease” ) , for a motion picture building parking area ( the Premises ”) located at 3225 South 2nd East Street, Salt Lake City, Utah; capitalized terms used but not defined herein shall have the meanings set forth in the Lease ; and
      Whereas, Century Theatres (DE) succeeded Century Theatres of Utah, Inc., as Tenant; and
      Whereas, Century Theatres (DE) assumed all obligations of Century Theatres of Utah, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, Syufy Properties, Inc., a California corporation has succeeded to and assumed all obligations of Syut Properties, Inc., as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now , Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
     
  1 Century 16 – Salt Lake City, UT


 

B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Properties, Inc.,
  Century Theatres, Inc.,    
a California corporation
  a California corporation    
“Landlord”
  “Tenant”    
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
     
  2 Century 16 – Salt Lake City, UT

 

 

EXHIBIT 10.33(f)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Salt Lake 16)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY PROPERTIES, INC., a California corporation (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. SYUT Properties, Inc., a Utah corporation (“Original Landlord”) and Century Theatres of Utah, Inc., a Utah corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Salt Lake City, Utah.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of January 4, 1998 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of September 1, 2000 (the “Second Amendment”), and (iii) that certain Third Amendment to Lease dated as of September 15, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***            and rather than ***           Renewal Terms of ***           each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***                consecutive Renewal Terms of ***            each, followed by ***           additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Salt Lake, Utah typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

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     6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1”.
     9.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and

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ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     12.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     13.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (a)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (b)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.

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  (c)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non- leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (d)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (e)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     14.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second-run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     15.  No Obligation To Continuously Operate. Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     16.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition

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shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  Remedies. The references in Article XV of the Lease to California Code Sections shall be disregarded, in the event of a breach or default by Tenant which is not cured within the applicable cure periods, if any, set forth in the Lease, Landlord shall have any and all remedies now or later allowed by law or equity.
     18.  [Intentionally Omitted]
     19.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with applicable law.
     (c) Addresses for Notices to Landlord and Tenant.
Notices are to be delivered, mailed or couriered to the following address(es):

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  To Landlord:   Syufy Properties, Inc.
 
      c/o Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     20.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     21.  Prior Amendments. All of the provisions of the First Amendment shall remain in full force and effect. All of the provisions of the Second Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Third Amendment is hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede such Third Amendment in its entirety.
     22.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All

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future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]
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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:   /s/ Joseph Syufy    
 
     
 
   
    Name: Joseph Syufy    
    Title: C E O    
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:   /s/ Raymond Syufy    
 
     
 
   
    Name: Raymond Syufy    
    Title: C E O    

 

 

EXHIBIT 10.34(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES — LARKSPUR THEATRE
Table of Contents
             
        Page No.  
Recitals
        1  
 
           
ARTICLE I: Definitions — Exhibits        
1.01
  Definitions     1  
 
           
ARTICLE II: Premises — Term — Options — Covenant of Title        
2.01
  Lease of Premises     2  
2.02
  Term of Lease     2  
2.03
  Covenant of Title     2  
 
           
ARTICLE III: Use of Premises        
3.01
  Use     3  
 
           
ARTICLE IV: Rent        
4.01
  Base Rent / Minimum Monthly Rent     3  
4.02
  Rent Payments     3  
4.03
  Place for Payment of Rent     3  
4.04
  Late Payment of Rent     3  
 
           
ARTICLE V: Taxes, Assessments and Utilities        
5.01
  Impositions     3  
5.02
  Proration of Taxes     4  
5.03
  Exceptions from Impositions; Charges in Lieu of Impositions     4  
5.04
  Contest of Taxes     4  
5.05
  Utilities     5  
5.06
  Personal Property Taxes     5  
 
           
ARTICLE VI: Insurance        
6.01
  Acquisition of Insurance Policies     5  
6.02
  Types of Required Insurance     5  
6.03
  Terms of Insurance     6  
6.04
  Landlord's Acquisition of Insurance     6  
6.05
  Insurance Money and Other Funds Held In Trust     6  
6.06
  Application or Proceeds of Physical Damage Insurance     6  
6.07
  Cooperation for Insurance Proceeds     7  
6.08
  Waiver of Right of Recovery     7  
 
           
ARTICLE VII: Maintenance, Repairs And Alterations        
7.01
  Alterations - Changes     7  
7.02
  Repairs - Maintenance     8  
 
           
ARTICLE VIII: Environmental Matters        
 
           
 
           

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LEASE
CENTURY THEATRES — LARKSPUR THEATRE
Table of Contents
             
        Page No.  
8.01
  Definition     8  
8.02
  Tenant’s Responsibilities and Landlord Indemnity     8  
8.03
  Remedial Work     9  
8.04
  Maintenance of Premises     10  
8.05
  Landlord’s Responsibilities and Tenant’s Indemnity     10  
8.06
  Landlord Inspection     11  
8.07
  Effect of Termination     11  
 
           
ARTICLE IX: Improvements        
9.01
  Tenant’s Signs     11  
9.02
  Hold Harmless     12  
9.03
  Permits; Compliance With Codes     12  
9.04
  Ownership     12  
9.05
  Control     12  
 
           
ARTICLE X: Indemnity        
10.01
  Indemnification     12  
 
           
ARTICLE XI: Assignment and Subletting        
11.01
  Assignment and Subletting     13  
11.02
  Notice to Landlord     13  
 
           
ARTICLE XII Encumbrance of Leasehold Estate        
12.01
  Leasehold Mortgages     13  
 
           
ARTICLE XIII: Mortgage Subordination        
13.01
  Existing Mortgages     14  
13.02
  Future Mortgages     14  
 
           
ARTICLE XIV: Condemnation — Eminent Domain        
14.01
  Definitions     14  
14.02
  Notice to Other Party     15  
14.03
  Total Taking - Effect on Rent and Term     15  
14.04
  Distribution of Award for Taking     15  
14.05
  Partial Taking - Rent Adjustments     15  
14.06
  Partial Taking - Option to Terminate     15  
14.07
  Separate Tenant’s Award     15  
 
           
ARTICLE XV: Default        
15.01
  Tenant’s Default     16  
15.02
  Landlord’s Remedies Cumulative     16  
15.03
  Landlord’s Default     17  
 
           
 
           

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LEASE
CENTURY THEATRES — LARKSPUR THEATRE
Table of Contents
             
        Page No.  
15.04
  Waiver of Redemption     18  
15.05
  Dispute Resolution     18  
15.06
  Attorney Fees     18  
 
           
ARTICLE XVI: Representations and Warranties        
16.01
  Landlord’s Representations and Warranties     19  
16.02
  Tenant’s Representations and Warranties     19  
 
           
ARTICLE XVII: Damage or Destruction        
17.01
  Repairs, Alterations and Further Improvements     19  
17.02
  Prompt Repair     20  
17.03
  Rent Adjustment     20  
 
           
ARTICLE XVIII: Miscellaneous        
18.01
  Limitation on Liability     20  
18.02
  Modification     20  
18.03
  Severability     20  
18.04
  Governing Law     20  
18.05
  Terminology     20  
18.06
  Counterparts     21  
18.07
  Binding Effect     21  
18.08
  Captions     21  
18.09
  Notice to Landlord and Tenant     21  
18.10
  Addresses for Notices to Landlord and Tenant     21  
18.11
  Entire Agreement     22  
18.12
  Sale or Transfer of Premises     22  
18.13
  Force Majeure     22  
18.14
  Waiver     22  
18.15
  Estoppel Certificate     22  
18.16
  Number and Gender     22  
18.17
  No Holding Over     22  
18.18
  Mechanics Liens     23  
18.19
  Relationship of Parties     23  
18.20
  Time of the Essence     23  
18.21
  Facsimile Copies     23  
18.22
  Anti-Merger     23  
 
           
Signature Page     23  
 
           
Exhibit A
  Description of Premises     A  
 
           
 
           

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LEASE
     THIS INDENTURE OF LEASE, dated as of, April 17, 1998 by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Pelican Way, San Rafael, California, hereinafter called “Landlord”, and CENTURY THEATRES, INC., a Delaware corporation with an office at 150 Pelican Way, San Rafael, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, Theatre Building, Improvements and Equipment located at 500 Larkspur Landing Circle, City of Larkspur, County of Marin, State of California.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
     1.01. Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean May 1, 1998.
               The term “Effective Date” shall mean April 17, 1998.
               The term “Default Rate” shall mean the lesser of (i) the “Prime Rate” plus four percent (4%) or (ii) the highest rate of interest that my lawfully be charged to the party then required to pay interest under this Lease at the Default Rate.
               The Term “Initial Rent Due Date” shall mean May 1, 1998.
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” and “Entire Premises” and “Premises” shall mean the property as set forth in Exhibit A and the rights, easements and privileges granted to Tenant in this Lease exclusive of the Lease with Pacific Bell Mobile Services which shall remain with the Landlord.
               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Permitted Use” shall mean the operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession

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stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term”.
ARTICLE II
PREMISES — TERM — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein excluding the lease with Pacific Bell Mobile Services.
          B) The Premises are being leased in their “as is” condition.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***       thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Covenant of Title; Authority and Quiet Possession; Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate, ect.”; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use .
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant shall be subject to, responsible for all costs and granted all rights of the easements, covenants, conditions and restrictions of record affecting the Leased Premises. Tenant shall be subject to the zoning ordinances and regulations and any other laws, ordinances or governmental regulations restricting or regulating the use, occupancy or enjoyment of the Leased Premises.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***      The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent”.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the Term.
     4.02 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.03 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.04 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s

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predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
          B) With respect to Impositions which by law may be paid in installments over a period of time, Landlord shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Landlord has in fact so elected. With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Tenant’s premises subject to the Installment Election, Tenant’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Landlord had in fact made the Installment Election.
          C) In the event the Premises are separately assessed by the taxing authority, Tenant shall pay all such real property taxes directly to the taxing authority prior to delinquency. In the event Tenant fails to pay such real property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
          D) In the event the Premises are not separately assessed by the taxing authority, Tenant shall pay all such real property taxes to the Landlord prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Proration of Taxes. If the Premises comprise a tax lot or lots with other property owned by Landlord or other parties (“Other Premises”) assessed for real estate tax purposes, together with said Other Premises, immediately after the Commencement Date, Landlord and Tenant shall attempt to cause the appropriate taxing authorities to assess the Premises for real estate tax purposes separately from all Other Premises. During any period in which the Premises are assessed for real estate purposes, together with any Other Premises, Landlord will pay, before the last day on which payment may be made without penalty or interest, all Impositions which shall be levied against the Other Premises.
     5.03 Exceptions from Impositions: Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
          B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition

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or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.05. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days alter Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.05.
     5.05 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Premises.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
          B) Builder’s Risk Insurance. During any restorations, alterations or changes in the Premises that may be made by Tenant at a cost in excess of Five Hundred Thousand Dollars ($500,000) per job, contingent liability and builder’s risk insurance upon the entire work on the Premises to the current one hundred percent (100%) replacement value thereof against “all risks” of physical loss or damage to the property insured, excluding earthquake and/or other earth movements and flood.
          C) Physical Property Damage Insurance. During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations and footings), all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance

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proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article VIII, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgagee as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second , for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third , if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (C) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:

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               (1)  First , Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2)  Second , any remainder shall be paid to Landlord..
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery. Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.

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     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Premises in first class condition for a building of like kind and place and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Premises shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safety Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinatedbyphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of

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Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work. In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with

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respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums

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paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof, or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs and which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided , however , Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits; Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of Landlord.
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification. Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this

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indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant in the Metropolitan Area, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operated motion picture theatres and has a book net worth of not less than $60,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgages.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.

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     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
          A) Notice of Intended Taking;
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this leasehold estate without improvements. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expenses;
          E) To Tenant, any other award which will not reduce the amount which otherwise would be awarded to Landlord; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award. In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, moving expenses and other related damages against the acquiring governmental Agency.

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ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;

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               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
     15.03 Landlord’s Default.
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s)

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within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution. Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:
               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding,

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to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
     16.02 Tenant’s Representations and Warranties. Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.

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          A) Tenant’s Obligation to Repair. If the Premises are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated. Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.
ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no went shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification. No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.

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     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect. Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant.
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.12 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.12 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     18.10 Addresses for Notices to Landlord and Tenant.
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises
 
      150 Pelican Way
 
      San Rafael, CA 94941
 
      Attn: Real Estate Department
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      150 Pelican Way
 
      San Rafael, CA 94941
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.

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     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
     18.14 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over. Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to

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one hundred twenty percent (125%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
          A) Terminate any existing subleases or subtenancies: or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
     
TENANT:
   
 
  CENTURY THEATRES, INC.,
 
  a Delaware Corporation
 
   
 
  By: /s/ Joseph Syufy
 
 
 
 
  Print Name: Joseph Syufy
 
  Title: PRESIDENT
 
   
LANDLORD:
   
 
  SYUFY ENTERPRISES
 
  a California Limited Partnership
 
   
 
  BY: Raymond Syufy
 
 
 
 
  Print Name:Raymond Syufy
 
  Title: G.P.

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EXHIBIT 10.34(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated April 30, 2003 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Tenant entered into a lease dated April 17, 1998 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located in Larkspur, California; and
     WHEREAS, the Initial Term of the Lease is set to expire on May 1, 2003;
     WHEREAS, the parties desire now to extend the Initial Term of the Lease by five years and provide for an option to Tenant to further extend the Lease for another five years, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Initial Term and Option to Extend
     Section 2.02 of the Lease is amended by deleting the reference in Section 2.02(A) to “ ***      ” and replacing it with “ ***      ” and by adding the following subparagraphs:
  B)   Tenant may, at Tenant’s option, extend the Initial Term of the Lease for a ***      additional period of ***      (the “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term shall commence at the expiration of the Initial Term, and shall terminate on the ***           of the date of the commencement of the Renewal Term in question, unless sooner terminated as provided herein.
 
  C)   Failure to duly exercise the option for the Renewal Term shall nullify the option to extend the term of the Lease.
 
  D)   Tenant’s right to extend the term of the Lease is subject to:
  1.   This Lease being in full force and effect on the last day of the Initial Term.
 
  2.   Compliance with the following procedure for exercising the option:
  a.   At least six (6) months before the last day of the Initial Term, Tenant shall give Landlord written notice exercising the option. If Tenant shall fail to
Larkspur      [STAMP]

 


 

      give such notice, then Landlord shall notify Tenant in writing of its failure (the “Reminder Notice”), and Tenant shall have an additional fifteen (15) days from its receipt of the Reminder Notice within which to give Landlord written notice exercising the option.
 
  b.   Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If the option is properly exercised by Tenant, the failure of Landlord to execute such a memorandum shall not invalidate such option or the exercise thereof.
 
  3.   Tenant is not in default (meaning the breach of any obligation hereunder and the failure to cure that breach within the applicable periods permitted in the Lease) at the time of the exercise of the Renewal Term.
      B. Rent
     Section 4.01(B) of the Lease is hereby deleted and replaced with the following:
  B)   The Minimum Monthly Rent of    ***      shall remain in effect up to and including April 30, 2003; thereafter, it shall increase to ***      for the remainder of the Initial Term. If Tenant shall elect to extend the Initial Term, as provided in Section 2.02, the Minimum Monthly Rent shall be increased on the first day of the Renewal Term by a percentage equal to the percentage increase (from April, 2003 to the first day of the Renewal Term) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for all Urban Consumers, All West Average (the “Consumer Price Index” or “CPI”); provided that in no event shall the Minimum Monthly Rent increase by less than ***      or more than ***      The Minimum Monthly Rent, as increased herein, shall apply from the first day of the Renewal Term through the end of the Renewal Term.
 
      In the event that the CPI is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the CPI or such successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the CPI shall be used by Landlord for the computations herein set forth.
Larkspur      [STAMP]

 


 

     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.
“Landlord”
  “Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
Larkspur      [STAMP]

 

 

EXHIBIT 10.34(c)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Second Amendment to Lease
      This Second Amendment to Lease (this “ Amendment ”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”), and Century Theatres, Inc. , a California corporation (“ Tenant ”).
Witnesseth:
      WHEREAS , Landlord and Century Theatres, Inc., a Delaware corporation (“Century Theatres ( DE )”) entered into a lease dated April 17, 1998, as amended by that certain First Amendment to Lease, dated April 30, 2003, between Syufy Enterprises, L.P. and Century Theatres (DE) (as amended, the “ Lease ”) for a motion picture building and related parking (the “ Premises ”) located at 500 Larkspur Landing Circle, Larkspur, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the First Amendment to Lease amended the Lease by extending the Initial Term of the Lease from ***       to ***      ; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Term of Lease
     The second sentence of Section 2.02(A) of the Lease, as amended by the First Amendment to Lease, is hereby amended by deleting “ ***       ” and replacing it with “ ***       ”.
B. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01 (a) of the Lease, the following is hereby inserted:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that
 
1 Century Larkspur – Larkspur, CA

 


 

are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
C. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
D. Compliance With Agreements
     Tenant acknowledges receipt of a copy of (i) that certain Amendment to Declaration of Conditions, Covenants and Restrictions and Grant of Easements, dated as of May 3, 2004 and recorded as document number 2004-0055408 in the Official Records of Marin County, California (the “Official Records”), amending that certain Declaration of Covenants, Conditions and Restrictions and Grant of Easements, dated on or about December 16, 1977 and recorded at Page 561, Book 3307 of the Official Records (collectively, the “ CC&Rs ”), and (ii) that certain Settlement Agreement and Mutual Release (the “Settlement Agreement”), executed by Landlord and Tenant, on the one hand, and Lincoln Larkspur Office One Associates, Ltd., Lincoln Larkspur Office Two Associates, Ltd., Lincoln Larkspur Office Three Associates, Ltd.,
 
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Legacy Partners Commercial, Inc., and EOP-Larkspur Landing Office Park, L.L.C., on the other hand, and Tenant covenants and agrees to abide by all terms and conditions contained in the CC&Rs and Settlement Agreement, including, without limitation, those related to hours of operation. Tenant shall defend, indemnify and hold harmless Landlord from any and all claims, demands, losses or judgments arising out of or related the CC&R’s, the Settlement Agreement, and their application to Tenant’s operations.
E . Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
 
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
 
4 Century Larkspur – Larkspur, CA

 

 

EXHIBIT 10.34(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “ Amendment ”) dated September 29,2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”), and Century Theatres, Inc., a California corporation (“ Tenant ”).
Witnesseth:
     WHEREAS, Landlord and Century Theatres, Inc., a Delaware corporation (“ Century Theatres ( DE )”) entered into a lease dated April 17, 1998, as amended by that certain First Amendment to Lease, dated April 30, 2003, between Syufy Enterprises, L.P. and Century Theatres (DE), and as further amended by that certain Second Amendment to Lease dated April 15, 2005 (as amended, the “Lease”) for a motion picture building and related parking (the “Premises” ) located at 500 Larkspur Landing Circle, Larkspur, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc., a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
 
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     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
     
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,
a California limited partnership
  a California corporation
“Landlord”
  “Tenant”
 
   
/s/ Raymond Syufy
  /s/ Joseph Syufy
 
   
Raymond Syufy,
  Joseph Syufy,
Chief Executive Officer
  Chief Executive Officer
 
2 Century Larkspur – Larkspur, CA

 

 

EXHIBIT 10.34(e)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FOURTH AMENDMENT TO LEASE
(Larkspur)
      THIS FOURTH AMENDMENT TO LEASE AGREEMENT (this Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord (then known as Syufy Enterprises, a California limited partnership (“Original Landlord”)) and Century Theatres, Inc., a Delaware corporation (“Original Tenant”), entered into a certain Lease dated as of April 17, 1998 (the “Original Lease”), for certain premises located in Larkspur, California.
     B. The Original Lease has been previously amended by that certain (i) First Amendment to Lease dated as of April 30, 2003 (the “First Amendment”), (ii) Second Amendment to Lease dated as of April 15, 2005 (the “Second Amendment”), and (iii) Third Amendment to Lease dated as of September 29, 2005 (the “Third Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.
     3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the

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contrary in the Lease but subject to the provisions of the Lease applicable to the exercise and validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***       and rather than ***      Renewal Terms of ***      each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***      consecutive Renewal Terms of ***       each, followed by ***       additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the County of Marin typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
     6.  Damage and Destruction — Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
          (A) Tenant’s Obligation to Repair . If the Leased Premises are

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damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20% . If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding

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stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.
     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:

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     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes . Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:
     (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
     (ii) Attributable to the annual inflationary increases in real estate taxes; or

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     (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
     12.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial in Tenant’s use of the Leased Premises as a motion picture theatre complex, including (without limitation) the conversion to stadium seating of the auditoria (if any) in the Leased Premises. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Any alterations, improvements or changes by Tenant must be consistent with the use and operation of the Leased Premises as a motion picture theatre complex. Tenant shall be required to complete all alterations, improvements and changes undertaken by Tenant. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment hereof.
     13.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any

6


 

third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder. Notwithstanding the foregoing, Tenant’s exclusive rights are subject to any agreements existing on the date hereof and any extensions thereof that may be exercised by the licensee or lessee thereunder regarding Rooftop Equipment. The lessees or licensees under such agreements may unilaterally extend or renew if and to the extent provided under such agreements, but Landlord may not renew or extend such agreements or extend such agreements unilaterally if such systems interfere with the transmission received by Tenant’s Rooftop Equipment installed pursuant to this Section.
     14.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
     (a) Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
     (b) Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
     (c) Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine or liquor store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.

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     (d) Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
     (e) Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     16.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     17.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     18.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to

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sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     19.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1) the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2) the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3) the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4) any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5) for any other sums due.”
     20.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the

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identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express. DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
          Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
                     150 Pelican Way
 
                     San Rafael, California 94901
 
                     Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601 94901
 
      Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this Section by giving written notice of such change to the other.
     21.  Miscellaneous Amendments . Notwithstanding anything contained herein to the

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contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     22.  Prior Amendments . The Second Amendment and the Third Amendment are hereby deemed to be void ab initio - it being the intent of the parties hereto that this Amendment shall supersede such Second Amendment and Third Amendment in their entirety.
     23.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
         
     
  By:   /s/ Joseph Syufy    
  Name:   Joseph Syufy  
  Title:   CEO   
 
Tenant:
CENTURY THEATRES, INC., a California corporation
         
     
  By:   /s/ Raymond Syufy    
  Name:   Raymond Syufy   
  Title:   CEO   
 
 

EXHIBIT 10.35(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE - PARKLANE, RENO, NEVADA
Table of Contents
         
    Page No.  
RECITALS
    1  
 
       
ARTICLE I EXHIBITS - DEFINITIONS
    1  
 
       
1.01 Attachments to Lease and Exhibits
    1  
1.02 Definitions
    1  
 
       
ARTICLE II PREMISES - TERM - OPTIONS - COVENANT OF TITLE
    2  
 
       
2.01 Lease of Premises
    2  
2.02 Term of Lease
    3  
2.03 Option to Extend Lease Term
    3  
2.04 Covenant of Title; Authority and Quiet Possession; Transfer of Title
    4  
 
       
ARTICLE III USE OF PREMISES
    4  
 
       
3.01 Use
    4  
 
       
ARTICLE IV RENT
    5  
 
       
4.01 Annual Fixed Rent
    5  
4.02 Percentage Rent
    5  
4.03 Rent Payments
    6  
4.04 Place for Payment of Rent
    6  
4.05 Late Payment of Rent
    6  
 
       
ARTICLE V TAXES, ASSESSMENTS AND UTILITIES
    6  
 
       
5.01 Impositions
    6  
5.02 Exceptions from Impositions; Charges in Lieu of Impositions
    7  
5.03 Contest of Taxes
    7  
5.04 Utilities
    7  
5.05 Personal Property Taxes
    7  

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LEASE - PARKLANE, RENO, NEVADA
Table of Contents
         
    Page No.  
ARTICLE VI INSURANCE
    7  
 
       
6.01 Acquisition of Insurance Policies
    8  
6.02 Types of Required Insurance
    8  
6.03 Terms of Insurance
    8  
6.04 Landlord’s Acquisition of Insurance
    9  
6.05 Insurance Money and Other Funds Held in Trust
    9  
6.06 Application or Proceeds of Physical Damage Insurance
    9  
6.07 Cooperation for Insurance Proceeds
    9  
6.08 Waiver of Right of Recovery
    10  
 
       
ARTICLE VII MAINTENANCE, REPAIRS AND ALTERATIONS
    10  
 
       
7.01 Alterations - Changes
    10  
7.02 Repairs - Maintenance
    10  
 
       
ARTICLE VIII ENVIRONMENTAL MATTERS
    11  
 
       
8.01 Definition
    11  
8.02 Tenant’s Responsibilities and Landlord Indemnity
    11  
8.03 Remedial Work
    13  
8.04 Maintenance of Premises
    13  
8.05 Landlord’s Responsibilities
    14  
8.06 Landlord Inspection
    14  
8.07 Effect of Termination
    14  
 
       
ARTICLE IX IMPROVEMENTS
    14  
 
       
9.01 Tenant Improvements
    14  
9.02 Hold Harmless
    14  
9.03 Permits; Compliance With Codes
    15  
9.04 Ownership of Improvements
    15  

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LEASE - PARKLANE, RENO, NEVADA
Table of Contents
         
    Page No.  
9.05 Control
    15  
 
       
ARTICLE X INDEMNITY
    15  
 
       
10.01 Landlord’s Indemnity
    15  
10.02 Tenant’s Indemnity
    16  
 
       
ARTICLE XI ASSIGNMENT AND SUBLETTING
    16  
 
       
11.01 Assignment and Subletting
    16  
11.02 Notice to Landlord
    16  
 
       
ARTICLE XII MORTGAGE SUBORDINATION
    17  
 
       
12.01 Existing Mortgages
    17  
12.02 Future Mortgages
    17  
 
       
ARTICLE XIII CONDEMNATION - EMINENTDOMAIN
    17  
 
       
13.01 Definitions
    17  
13.02 Notice to Other Party
    18  
13.03 Total Taking - Effect on Rent and Term
    18  
13.04 Distribution of Award for Taking
    18  
13.05 Partial Taking - Rent Adjustments
    18  
13.06 Partial Taking - Option to Terminate
    18  
13.07 Separate Tenant’s Award
    19  
 
       
ARTICLE XIV DEFAULT
    19  
 
       
14.01 Tenant’s Default
    19  
14.02 Landlord’s Remedies Cumulative
    19  
14.03 Landlord’s Default
    21  
14.04 Waiver of Redemption
    21  
14.05 Dispute Resolution
    21  

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LEASE - PARKLANE, RENO, NEVADA
Table of Contents
         
    Page No.  
14.06 Attorneys’ Fees
    21  
 
       
ARTICLE XV REPRESENTATIONS AND WARRANTIES
    22  
 
       
15.01 Landlord’s Representations and Warranties
    22  
15.02 Tenant’s Representations and Warranties
    22  
 
       
ARTICLE XVI DAMAGE OR DESTRUCTION
    22  
 
       
16.01 Repairs, Alterations and Further lmprovements
    23  
16.02 Prompt Repair
    23  
16.03 Rent Adjustment
    23  
16.04 Damage During Last Two (2) Years of Term
    23  
 
       
ARTICLE XVII MISCELLANEOUS
    24  
 
       
17.01 Limitation on Liability
    24  
17.02 Brokers
    24  
17.03 Modification
    24  
17.04 Severability
    24  
17.05 Governing Law
    24  
17.06 Terminology
    24  
17.07 Counterparts
    24  
17.08 Binding Effect
    24  
17.09 Captions
    24  
17.10 Notices to Landlord and Tenant
    24  
17.11 Addresses for Notices to Landlord and Tenant
    25  
17.12 Entire Agreement
    25  
17.13 Sale or Transfer of Premises
    25  
17.14 Force Majeure
    26  
17.15 Waiver
    26  
17.16 Estoppel Certificate
    26  

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LEASE - PARKLANE, RENO, NEVADA
Table of Contents
         
    Page No.  
17.17 Number and Gender
    26  
17.18 No Holding Over
    26  
17.19 Mechanics Liens
    27  
17.20 Relationship of Parties
    27  
17.21 Time of the Essence
    27  
17.22 Facsimile Copies
    27  
17.23 Anti-Merger
    27  
 
       
SIGNATURE PAGE
    28  
     
Exhibit A
  A Site Plan of the Parklane Mall retail center including the Leased Premises which is outlined in Red.
Exhibit B
  Form of Memorandum of Lease

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LEASE
     THIS INDENTURE OF LEASE, dated as of August 1, 1997, by and between SYUFY ENTERPRISES , a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, CA, hereinafter called “Landlord”, and CENTURY THEATRES, INC., a Delaware corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord will be acquiring a fee interest in Real Property located within the Parklane Mall retail center on South Virginia Street, Reno, Nevada from Sierra Pacific Properties, Inc., a California Corporation, hereinafter called “Sierra”, under an Exchange Agreement between Landlord and Sierra dated April 12, 1996. The Real Property shall consist of a building pad of 72,283 square feet and a 57,784 square foot, 16-screen movie theatre building. In addition the Real Property shall be subject to a Construction, Operation and Reciprocal Easement Agreement, hereinafter called “COREA”, by and between The MaceRich Partnership, L.P. a Delaware limited Partnership and Sierra dated August 28, 1997, a copy of which is attached hereto, marked Exhibit C.
     This Lease is subject to and contingent upon Landlord acquiring the fee interest in the Real Property located within the Parklane Mall. If Landlord does not acquire title to the Real Property this Lease shall be terminated without any liability on the part of Landlord or Tenant.
     Subject to the above recitals and understanding, Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises (as defined below).
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS - DEFINITIONS
      1.01 Attachments to Lease and Exhibits
                         Attached to this Lease and hereby made a part hereof are the following:
                         EXHIBIT A — a Site Plan of the Parklane Mall retail center including the Leased Premises which is outlined in red.
                         EXHIBIT B — Form of Memorandum of Lease
                         EXHIBIT C — Construction, Operation and Reciprocal Easement Agreement dated April 12, 1996.
      1.02 Definitions .
                         The following terms for purposes of this Lease shall have the meanings hereinafter specified:
                         The term “Commencement Date” and “Rent Commencement Date” shall mean the date Landlord acquires title to the property
PARKLANE

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                         The term “COREA” shall mean the Construction, Operation and Reciprocal Easement Agreement dated August 28, 1997.
                         The term “Effective Date” shall mean the date Landlord acquires title to the property.
                         The term “Default Rate” shall mean the Ten percent (10%).
                         The term “Initial Term” is defined in Section 2.02 herein.
                         The term “Leased Premises” or “Premises” or “Real Property” shall mean the 16 screen movie theatre building and the land thereunder as set forth in Exhibit A and the rights, easements and privileges granted to Landlord under the COREA.
                         The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Premises or any part thereof.
                         The term “Number of Term Years” shall mean      ***
                         The term “Option Periods” shall mean ***       successive separate periods of ***      each and ***       successive period of***     
                         The term “Percentage Rate” shall mean ***
                         The term “Planned Use” shall mean the operation of a 57,784 square foot multiplex motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant.
                         The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A., New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
                         The term “Tenant’s Building” shall mean the theatre building.
                         The term “term of this Lease” or “term hereof” shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
2.01 Lease of Premises .
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned “Environmental Matters”.
PARKLANE

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          C) Landlord shall deliver possession of the Premises to Tenant upon acquisition of title to the Real Property.
          D) Additional obligations of Landlord and Tenant:
               (I) Landlord Obligations:
                         Under the Exchange Agreement with Sierra, Sierra will acquire land and construct a 16 screen theatre building in accordance with plans and specifications approved by Landlord and Tenant. Sierra will provide the maximum sum of $12,500,000 toward all costs related to the land acquisition and construction of the theatre building which sum shall represent the total obligation of Landlord.
               (II) Tenant Obligations:
                         Tenant shall pay any difference between the total land, building and improvement costs less the $12,500,000. In addition Tenant shall pay for all furniture, fixtures and equipment required to complete and operate the theatre.
      2.02 Term of Lease .
                    Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
                    The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter and shall terminate on the last day of the calendar month during which the date which is ***      after the Commencement Date occurs. References herein to the“ Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
      2.03 Option to Extend Lease Term .
               A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to *** consecutive additional periods of ***             and             *** additional period of ***             (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***             of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
               B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
               C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
                    (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
                    (2) Compliance with the following procedure for exercising the option in question:
                              (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
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                              (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
                    (3) Tenant is not in default (meaning the breach of any obligation hereunder and failure to cure that breach within the time permitted in Section 14.01) at time of the exercise of the renewal and at the commencement of the renewal term.
      2.04 Covenant of Title: Authority and Quiet Possession: Transfer of Title .
                    (A) Landlord represents and warrants to Tenant that Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof.
                    (B) At all times during the Term, Tenant shall keep and maintain Tenant’s Building in good order and repair and in a clean and safe condition, reasonably free of debris. Tenant’s obligation hereunder shall include the obligations set forth in the COREA, Tenant shall indemnify and save harmless Landlord from and against all actions, claims and damages by reason of Tenant’s failure to comply with and perform its obligations under this section. In case of conflict between this Lease and the COREA, the terms and provisions of the COREA shall prevail.
                    (C) Tenant will not permit the Premises to become subject to any mechanics’, laborers’ or materialmen’s lien on account of labor or material furnished to Tenant or claimed to have been furnished to Tenant in connection with work of any character performed or claimed to have been performed on the Premises by or at the direction or sufferance of Tenant; provided, however, Tenant shall have the right to contest in good faith and with reasonable diligence the validity of any such lien or claimed lien and on final determination of the lien or claim for the lien, Tenant will immediately pay any judgment rendered with all proper costs and charges, and will, at its own expense, have the lien released and any judgment satisfied.
                    (D) Conditions Precedent: Tenant’s obligation to lease the Premises is conditioned upon Landlord acquiring the property under the terms of the Exchange Agreement with Sierra.
ARTICLE III
USE OF PREMISES
      3.01 Use .
             A) The Premises may be used in accordance with and subject to the conditions set forth in the COREA.
             B) Landlord shall agree and consent to such utility and other easements encumbering the Premises or benefiting the Premises as Tenant may reasonably require for its use and occupancy of the Premises.
             C) Tenant shall be subject to all of the benefits and responsible for all costs, as well as all obligations, associated with the COREA.
             D) If Tenant ceases operating the Theatre for a period in excess of sixty (60) days and the owner of the Shopping Center elects to purchase the Leased Premises in accordance with the applicable provisions of the COREA, Tenant shall promptly vacate the Premises; however, Tenant shall remain liable to Landlord for all rent due for the balance remaining of either the Original Term or Renewal Term of this Lease.
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ARTICLE IV
RENT
      4.01 Annual Fixed Rent .
              A) Beginning on the Rent Commencement Date, Tenant shall pay to Landlord during the Lease Term Annual Fixed Rent in the amount of ***      The Annual Fixed Rent shall be payable in advance in twelve (12) equal monthly installments. The Annual Fixed Rent shall be subject to adjustment every ***      after the Initial Rent Due Date as set forth in Section 4.01 (B) below.
              B) The Annual Fixed Rent shall apply from the Rent Commencement Date through the end of the ***      Lease Year of the Term. The Annual Fixed Rent shall be increased on the first day of the ***      Lease Year and on the first day of each *** Lease Year thereafter during the Term by an amount of ***      greater than the Annual Fixed Rent payable immediately before the Adjustment date in question.
      4.02 Percentage Rent .
              In addition to the payment of Annual Fixed Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which ***             percent of the Gross Sales for such Lease Year exceeds the Annual Fixed Rent which is payable for such Lease Year. For the purpose of computing the Annual Percentage for the first Lease Year, the Gross sales and the annual fixed rate percentage for the partial calendar month, if any, preceding the first Lease Year shall be includable in the Annual Fixed Rate and Gross Sales for the first Lease Year.
              Gross Sales shall mean all box office receipts, and receipts from sales of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant and returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions”. Commissions paid to agencies or other third parties for selling tickets and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
              Tenant agrees to furnish Landlord a statement certified by its chief financial or similar officer of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
              The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the payment. Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales . Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of eighteen (18%) percent from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof.
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      4.03 Rent Payments . Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
      4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
      4.05 Late Payment of Rent . In the event that any monthly installment of rent is not paid within ten (10) days after such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of ten (10%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
      5.01 Impositions .
              A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Premises, or the rents receivable therefrom, or any part thereof or any use thereon or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any such items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay when due all Impositions assessed, levied or attributable to the Premises and/or the Improvements on the Premises.. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.
              B) In the event Tenant fails to pay such Real Property taxes as provided herein, Landlord may, but shall not be required to, pay the same, and any amount so paid by Landlord shall immediately thereafter become due to Landlord from Tenant as Additional Rent with interest thereon at the rate of 18% per annum from the date of Landlord’s payment plus any fine, penalty, interest or cost which is levied by the taxing authority for such late payment.
              C) Tenant shall be responsible for such impositions as are set forth in the COREA.
      5.02 Exceptions from Impositions: Charges in Lieu of Impositions .
              A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
              B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relates to real estate or revenues from real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or partly on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on
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the Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would be payable if the Premises were the only property of Landlord subject to such taxes, or the income from operation of the Premises were Landlord’s only income, as the case may be.
      5.03 Contest of Taxes . Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefor, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord shall cooperate with any effort pursued by Tenant in accordance with this Section 5.03. Tenant shall indemnify, protect and hold harmless Landlord and the Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.03.
      5.04 Utilities . Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities consumed on the Premises. Any utility improvements presently serving the Premises shall be maintained, repaired and replaced by Tenant, at Tenant’s expense. Tenant shall be responsible for all costs for utilities as are set forth in the COREA.
      5.05 Personal Property Taxes . During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, if Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including without limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (18%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.
ARTICLE VI
INSURANCE
      6.01 Acquisition of Insurance Policies . Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured. In addition Tenant shall, at its sole cost and expense, procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in the COREA.
      6.02 Types of Required Insurance . Tenant shall procure and maintain the following:
              A) Commercial General Liability Insurance . Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Premises, Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Five Million Dollars ($5,000,000) per occurrence and in the aggregate.
              B) Physical Property Damage Insurance . During the term hereof, Tenant shall keep Tenant’s Building (excluding foundations, footings and underground improvements) as well as any and all improvements on the Premises and personal property insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) including Builder’s Risk and earthquake to the extent of not less than 100% of the full replacement cost thereof less any deductible
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applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Upon written request, Tenant shall name Landlord and any parties requested by Landlord and the holder of the first mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Tenant in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
      6.03 Terms of Insurance . The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
              A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
              B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to Landlord except after twenty (20) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
              C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
              D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.
      6.04 Landlord’s Acquisition of Insurance . If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
      6.05 Insurance Money and Other Funds Held in Trust . All insurance money or proceeds received by the Tenant and/or Landlord shall be held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
              First, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and Second, if the damaged or destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
      6.06 Application or Proceeds of Physical Damage Insurance . In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance
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proceeds from damage or loss to property shall be determined in part in accordance with Article XVI hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Tenant and Landlord shall apply the proceeds of the insurance collected to the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Tenant and Landlord by the licensed architect or engineer in charge of the work. Any amounts payable to Tenant or any Affiliate of Tenant for work or services performed or materials provided as part of any such repair, replacement, restoration or rebuilding shall not exceed competitive rates for such services or materials and Tenant shall, upon request of Landlord, make available to Landlord and its representatives all books and records of Tenant relating to such work, services and materials. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Tenant or Landlord with respect to the damage or destruction involved, and not used, shall be and remain the property of Landlord.
              A) Distribution of Unutilized Proceeds . At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Tenant and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
                   (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
                   (2) Second, any remainder shall be paid to Landlord.
      6.07 Cooperation for Insurance Proceeds . Landlord and Tenant shall each cooperate with the other in order to obtain the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
      6.08 Waiver of Right of Recovery . Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article, irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unleasable or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other
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party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
      7.01 Alterations — Changes .
              A) Subject to any and all conditions set forth in the COREA, at any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion of the interior of the building provided that all such alterations or changes shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural in nature Landlord’s written approval shall be first obtained, which approval shall not be unreasonably withheld. Tenant may not make any alterations, additions or changes to the exterior of the building.
              B) Tenant shall at all times keep the Premises or any part thereof, free and dear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
              (C) Upon termination of this Lease, Tenant may, at its option, remove any personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
      7.02 Repairs — Maintenance .
              Tenant shall, at its sole cost and expense, maintain and repair the Premises and Tenant’s Building and all improvements on the Premises including all exterior lighting and signs.
              Tenant shall commence all of the repairs and maintenance within 3 days after receiving notice thereof from Landlord (provided that in the case of an emergency Tenant shall commence such work immediately upon receiving notice) and shall be diligently completed in a good and workmanlike manner. Notwithstanding the foregoing, Landlord shall have the right and option (but not the obligation) to undertake any such repair, maintenance or other items, in which event Tenant shall reimburse Landlord for all of the costs thereof within 30 days after Landlord’s request therefor. If Tenant fails to reimburse Landlord within the 30 day period, Tenant shall pay Landlord in addition interest thereon at the rate of 18% per annum until such payment has been made.
      7.03 Repairs — Common Area .
              Tenant shall be responsible for its repair and maintenance obligations as set forth in the COREA.
ARTICLE VIII
ENVIRONMENTAL MATTERS
      8.01 Definition . For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251,
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et seq.; all as amended, or any State of Nevada or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs’); and freon and other chloroflurocarbons.
      8.02 Tenant’s Responsibilities and Landlord Indemnity .
              A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
              B) Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.
              C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence
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(excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
              D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the condition existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
      8.03 Remedial Work . In the event any investigation or monitoring of site conditions or any cleanup, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, state or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to commence or cause to be commenced in a timely fashion, or
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fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case where Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any other third parties.
      8.04 Maintenance of Premises .
              A) Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
              B) Tenant shall be liable and responsible for an Hazardous Materials which Tenant causes to be brought onto the Premises.
      8.05 Landlord’s Responsibilities .
              A) Landlord shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Premises or any other portion of the Premises by Landlord, its agents, employees, contractors or invitees, in violation of any law.
              B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials.
      8.06 Landlord Inspection . Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII, Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate of ten percent (10%) per annum.
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      8.07 Effect of Termination .
              A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge, Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
              B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
      9.01 Improvements . Tenant Building and Improvements will be constructed in accordance with Section 2.01 of Article II.
      9.02 Hold Harmless . Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction by Tenant of Improvements or repairs made at any time to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
      9.03 Permits; Compliance With Codes . All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
      9.04 Ownership of Improvements .
              A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein excluding moveable trade fixtures and personal property of Tenant, shall become the property of Landlord, unless and to the extent Tenant elects to remove any of the foregoing pursuant to Section 9.04 (B).
              B) Tenant shall have the right to remove all trade fixtures, equipment and furnishings, including seats, carpets, draperies, screen, sound reproducing equipment, projection equipment, furniture and lobby frames from the Premises without notice to Landlord provided, Tenant replaces all items removed with items of similar quality or better quality and the foregoing shall remain the property of the Tenant at the
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expiration or earlier termination of the Lease. In addition, Landlord shall have the right if Landlord so elects by giving written notice to Tenant of such election at any time before ninety (90) days prior to the end of the Term (including any renewals or extensions) hereof to remove at Tenant’s sole cost any other Improvements and all additions, alterations and improvements thereto or replacements thereof erected, constructed, or installed on the Premises. The removal of any of the foregoing shall be completed within thirty (30) days following the end of the Term hereof (including any renewals thereof or any earlier termination permitted by this Lease.
      9.05 Control . Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
      10.01 Landlord’s Indemnity . Except to the extent attributable to the intentional and negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successors, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as “Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Tenant, its agents, employees, licensees, invitees or contractors on the Leased Premises, occurring within the Leased Premises or (ii) arising from Tenant’s or its employees use of the Leased Premises.
      10.02 Tenant’s Indemnity . Except to the extent attributable to the intentional and negligent acts or omissions of Tenant and its agents, employees, tenants, licensees and contractors, Landlord shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant (and its successors, assigns and sublesses), and all of their directors, officers, employees and agents, hereinafter referred to as “Tenant Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), directly or indirectly arising out of or attributable to (i) any intentional or negligent act or omission of Landlord, its agents, employees, licensees, invitees on the Premises or contractors, occurring within the Premises, or (ii) arising from Landlord’s use of the Premises.
      10.03 COREA . Tenant shall be subject to and be responsible for all the indemnification provisions as set forth in the COREA.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
      11.01 Assignment and Subletting .
              A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease. Landlord shall be entitled to all rent from any assignment or sublease in excess of the Annual Fixed Rent set forth in this Lease.
              B) Any assignment of this Lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
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              C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without Landlord’s consent, assign this Lease (a) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (b) to Tenant’s Parent Corporation. or (e) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, provided that such corporation duly and validly then guarantees the performance of the obligations under this Lease.
      11.02 Notice to Landlord . Tenant shall give notice to Landlord in writing of any assignment of the Lease ten (10) days prior to such event.
ARTICLE XII
MORTGAGE SUBORDINATION
      12.01 Existing Mortgages . If there is an existing mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises or in any other part of the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
      12.02 Future Mortgages . The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIII
CONDEMNATION — EMINENT DOMAIN
      13.01 Definitions . The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Premises or Improvements or Parking or any interest in them by eminent domain or inverse condemnation:
              A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
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              B) “Total Taking” means the Taking of the fee title to the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements.
              C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, or any Improvements thereon which is not a Total Taking.
              D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.
              E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
      13.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and date of the notice received:
              A) Notice of Intended Taking;
              B) Service of any legal process relating to condemnation of the Premises or improvements;
              C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
              D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation.
      13.03 Total Taking — Effect on Rent and Term . On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
      13.04 Distribution of Award for Taking . On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
              A) To Landlord, the amount awarded, if any for the Fair Market Value of all Land, buildings and other improvements on the Premises and all Severance Damages.
              B) To Tenant, the amount awarded, if any, for loss of goodwill, lost business, lost profits, relocation expenses and fixtures; and
              C) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 13.04 out of amounts awarded by the governmental body taking the Premises.
      13.05 Partial Taking — Rent Adjustments . On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be
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reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
      13.06 Partial Taking — Option to Terminate . Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty-three percent (33%) of the Building is taken by condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
      13.07 Separate Tenant’s Award . In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses, fixtures and relocation expenses against the acquiring governmental Agency.
ARTICLE XIV
DEFAULT
      14.01 Tenant’s Default . The occurrence of any of the following shall constitute a default or event of default by Tenant:
              A) Failure to pay Annual Fixed Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
              B) Failure to perform any of Tenant’s non-monetary obligations under this Lease; provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
      14.02 Landlord’s Remedies Cumulative . Landlord shall have the following remedies set forth in subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
              A) Bring Suit for Performance . Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
              B) Re-Entry Without Termination . Pursuant to California Civil Code Section 1954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated,
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such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 14.02(B), Tenant shall have the right to sublet the Premises, assign its interest in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
              C) Termination of Lease and Lessee’s Right to Possession . No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord shall have the right to recover from Tenant the following:
                   (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
                   (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
                   (3) The worth, at the time of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
                   (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
              D) Definitions . As used herein, the following phrases shall be interpreted as follows:
                   (1) “The worth, at the time of the award,” as used in subsections 14.02(C)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the time of the award,” as referred to in subsection 14.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
                   (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
              E) Surrender . Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 14.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
              F) Appointment of Receiver . If Tenant defaults under Section 14.02(C), Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
              G) Landlord’s Right to Cure Tenant’s Default . Landlord, at any time after Tenant is in default under Section 14.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sum paid
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by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at ten percent (10%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.
      14.03 Landlord’s Default .
              A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
              B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
      14.04 Waiver of Redemption . Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
      14.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 14.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
              A) Description of Dispute . The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
              B) Mediation . A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter.
              C) Arbitration . With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party, which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. Arbitration shall be conducted under the Commercial Arbitration Rules of the American Arbitration Association.
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      14.06 Attorneys ’ Fees . Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XV
REPRESENTATIONS AND WARRANTIES
      15.01 Landlord’s Representations and Warranties . Landlord represents and warrants:
               A) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
               C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
               D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.
               E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
               F) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord after the date Landlord acquires title to the property, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances. Title to the Premises shall be free of all Objected Exceptions.
      15.02 Tenant’s Representations and Warranties . Tenant represents and warrants:
               A) Tenant is a Delaware corporation in good standing.
               B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
               C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
ARTICLE XVI
DAMAGE OR DESTRUCTION
      16.01 Repairs, Alterations and Further Improvements .
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               In the event of damage to or destruction of the Tenant’s Building or any Improvements on or to the Premises whether or not covered by the insurance described in Article 6: Tenant shall effect, at Tenant’s sole cost and Landlord and Tenant agree that the funds derived from insurance acquired pursuant to Article 6 shall be made available to effect, such repair and reconstruction of the structure or improvement so damaged or destroyed to substantially its condition prior to said damage or destruction with such alterations thereto as Tenant shall reasonably determine prudent or viable under the circumstances, including any changes required to comply with applicable law, with the then prevailing construction practices applicable to the Premises. Tenant shall be responsible for all costs in excess of Insurance proceeds available All such work shall be carried on in accordance with the provisions of the COREA and with Drawings prepared by a licensed architect or architects approved by Landlord (acting reasonably) if such an architect is reasonably required, given the scope and nature of the work. In disbursing insurance proceeds the Tenant and Landlord may rely upon and accept the certified determinations of such architect with respect to estimated costs, awarding of contracts, sufficiency of bonds, progress of construction, interpretation of plans and specifications, compliance with same, and completion of construction. No extras or changes in Drawings shall be made by Tenant without first giving written notice of such changes to Landlord and obtaining Landlord’s approval thereof (which approval shall not be unreasonably withheld or delayed).
               If such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto, the Lease shall Terminate and any insurance proceeds shall become the property of Landlord.
      16.02 Prompt Repair . If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided), and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same, governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
      16.03 Rent Adjustment . This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall thereafter not abate but continue for as long as and to the extent such Improvements are untenantable.
      16.04 Damage During Last Two (2) Years of Term . If there occurs during the last two (2) years of the Initial Term or at any time during a Renewal Period damage or destruction to any Improvement on or in the Premises and the costs of repairing, restoring, replacing or rebuilding the same exceed Five Thousand Dollars ($500,000), then Landlord may elect to terminate the Term and, in such event, Landlord shall give notice to Tenant of its election within sixty (60) days after its determination of the amount of damage, and the Term shall thereupon terminate as of the date of such notice and all insurance proceeds shall become the property of Landlord.
ARTICLE XVII
MISCELLANEOUS
      17.01 Limitation on Liability . The liability of Landlord hereunder or in connection with the Premises shall be limited to its interest in the Premises and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Premises.
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      17.02 Brokers . Landlord and Tenant each represent to the other that neither has any obligation to any broker or finder in connection with this transaction, and that no fee or commission is due any broker, finder, or similar person in connection herewith. Landlord and Tenant each indemnifies the other and agrees to hold the other harmless from and against any and all claims, demands, liabilities, lawsuits, costs, and expenses (including reasonable attorneys’ fees) for any fee or commission due to any other broker, finder, or similar person in connection with this transaction and arising out of the act of the indemnifying party.
      17.03 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
      17.04 Severability . In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
      17.05 Governing Law . This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of Nevada and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
      17.06 Terminology . All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease falls on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
      17.07 Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
      17.08 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
      17.09 Captions . Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
      17.10 Notices to Landlord and Tenant .
               A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 17.11 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
               B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 17.11 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying
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lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.
               C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent..
      17.11 Addresses for Notices to Landlord and Tenant .
     Notices to are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord :   Syufy Enterprises
 
      150 Golden Gate Ave.
 
      San Francisco, CA 94102
 
      Attn.: Real Estate Department
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      150 Golden Gate Avenue
 
      San Francisco, CA 94102
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
      17.12 Entire Agreement . This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
      17.13 Sale or Transfer of Premises . Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant. Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
      17.14 Force Majeure . In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive
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governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.
      17.15 Waiver . No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
      17.16 Estoppel Certificate . Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
      17.17 Number and Gender . Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
      17.18 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
      17.19 Mechanics Liens . Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
      17.20 Relationship of Parties . Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
      17.21 Time of the Essence . Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
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      17.22 Facsimile Copies . Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.
      17.23 Anti-Merger . The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either:
               A) Terminate any existing subleases or subtenancies; or
               B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
               Executed as of the date first written above.
TENANT :
             
    CENTURY THEATRES, INC.,    
    a Delaware Corporation    
 
           
 
  By.   /s/ Joseph Syufy
 
   
    Print Name: Joseph Syufy    
    Title: Sr. Executive Vice President    
LANDLORD :
             
    SYUFY ENTERPRISES    
    a California Limited Partnership    
 
           
 
  By:   /s/ Raymond Syufy
 
   
    Print Name: Raymond Syufy    
    Title: General Partner    
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EXHIBIT 10.35(b)
First Amendment to Lease
      This First Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”), and Century Theatres, Inc., a California corporation (“Tenant”) .
Witnesseth:
      Whereas, Landlord and Century Theatres of Nevada, Inc. entered into a lease dated September 30, 1995 (the “Lease” ) for a motion picture building and related parking (the “Premises” ) located at 2985 So. Virginia Street, Reno, Nevada; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres of Nevada, Inc., as Tenant; and
      Whereas, Century Theatres, Inc. has assumed all obligations of Century Theatres of Nevada, Inc., as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01 (a) of the Lease, the following is hereby added:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     
  1 Century 16 Park Lane – Reno, NV


 

     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment
     
  2 Century 16 Park Lane – Reno, NV

 


 

or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
 
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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
 
Raymond Syufy,
  /s/ Joseph Syufy
 
Joseph Syufy
   
Chief Executive Officer
  Chief Executive Officer    
 
4 Century 16 Park Lane – Reno, NV

 

 

EXHIBIT 10.35(c)
Second Amendment to Lease
      This Second Amendment to Lease (this “Amendment” ) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”), and Century Theatres, Inc., a California corporation (“Tenant”) .
WITNESSETH:
      Whereas, Landlord and Century Theatres of Nevada, Inc. entered into a lease dated August 1, 1997, as amended by (and incorrectly dated in) that certain First Amendment to Lease dated April 15, 2005 (the “Lease” ) for a motion picture building and related parking (the “Premises” ) located at Park Lane Mall, Reno, Nevada; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres of Nevada, Inc., as Tenant; and
      Whereas, Century Theatres, Inc. has assumed all obligations of Century Theatres of Nevada, Inc., as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this
 
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     Amendment when fully signed and delivered shall constitute a binding agreement of such party enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
         
Syufy Enterprises, L.P.,
  Century Theatres, Inc.,    
a California limited partnership
  a California corporation    
“Landlord”
  “Tenant”    
 
       
/s/ Raymond Syufy
  /s/ Joseph Syufy    
 
Raymond Syufy,
 
 
Joseph Syufy,
   
Chief Executive Officer
  Chief Executive Officer    
 
2 Century 16 Park Lane – Reno, NV

 

 

EXHIBIT 10.35(d)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
THIRD AMENDMENT TO LEASE
(ParkLane, Nevada)
     THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
RECITALS:
     A. Landlord (then known as Syufy Enterprises (“Original Landlord”)) and Century Theatres of Nevada Inc., a Nevada corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”), for certain premises located in Reno, Nevada.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of April 15, 2005 (the “First Amendment”) and (ii) that certain Second Amendment to Lease dated as of September 29, 2005 (the “Second Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
      1.  Recitals Incorporated; Certain Defined Terms . The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
      2.  Effectiveness . The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Ho]dings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

      3.  Initial Term of Lease and Extension Options . Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***      and rather than ***      Renewal Terms of ***      each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***      consecutive Renewal Terms of ***      each, followed by ***      additional and final Renewal Term of***
      4.  Landlord’s Recapture Right . If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the Reno, Nevada metropolitan area typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
      5 Self-Insurance of Property/Casualty Risks . Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on such determination date.

2


 

     6.  Damage and Destruction – Repairs by Tenant . Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair, If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release . Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

3


 

not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided , however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing . Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-1” .
     9.  Memorandum of Lease . On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales . Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided, however, that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Alterations by Tenant .
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make nonstructural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and

5


 

ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
     12.  Rooftop Equipment and Access . Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     13.  Alterations and Development by Landlord . Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
  (i)   Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent onl y if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
 
  (ii)   Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.

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  (iii)   Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non-leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
 
  (iv)   Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
 
  (v)   Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     14.  Permitted Use and Operations . From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “second run” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     15.  No Obligation To Continuously Operate . Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     16.  Removal of Equipment, Surrender and Demolition . Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result, except as

7


 

otherwise provided in the Lease. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     17.  Remedies . The references in Article XV of the Lease to California Code Sections shall be disregarded. In the event of a breach or default by Tenant which is not cured within the applicable cure periods, if any, set forth in the Lease, Landlord shall have any and all remedies now or later allowed by law or equity.
     18.  [ Intentionally Omitted .]
     19.  Notices . The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below (including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mall or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to he a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with applicable law.
     (c) Addresses for Notices to Landlord and Tenant.
     Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: President

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  with a copy to:   Syufy Enterprises, L.P.
 
      150 Pelican Way
 
      San Rafael, California 94901
 
      Attention: General Counsel
 
       
 
  and a copy to:   DLA Piper
 
      203 North LaSalle
 
      Suite 1900
 
      Chicago, IL 60601
 
      Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
 
      c/o Cinemark, Inc.
 
      3900 Dallas Parkway
 
      Suite 500
 
      Plano, TX 75093
 
      Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     20.  Miscellaneous Amendments . Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     21.  Prior Amendments . The First Amendment and the Second Amendment are hereby deemed to be void ab initio - it being the intent of the parties hereto that this Amendment shall supersede such First Amendment and Second Amendment in their entirety.
     22.  Effect of Amendment . The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF , Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P. , a California limited partnership
             
 
  By:   /s/ Joseph Syufy
 
   
 
  Name        
 
           
 
  Title:        
 
           
Tenant:
CENTURY THEATRES, INC. , a California corporation
             
 
  By:   /s/ Raymond Syufy
 
   
 
  Name        
 
           
 
  Title:        
 
           

 

EXHIBIT 10.36(a)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
LEASE
CENTURY THEATRES
Table of Contents
                 
            Page No.  
Recitals     1  
       
 
       
ARTICLE I: Definitions — Exhibits        
  1.01    
Attachments to Lease and Exhibits
    1  
  1.02    
Definitions
    1  
       
 
       
ARTICLE II: Premises — Term — Options — Covenant of Title        
  2.01    
Lease of Premises
    2  
  2.02    
Term of Lease
    2  
  2.03    
Option to Extend Lease Term
    3  
  2.04    
Covenant of Title
    3  
       
 
       
ARTICLE III: Use of Premises        
  3.01    
Use
    4  
       
 
       
ARTICLE IV: Rent        
  4.01    
Base Rent /Minimum Monthly Rent
    4  
  4.02    
Percentage Rent
    4  
  4.03    
Rent Payments
    5  
  4.04    
Place for Payment of Rent
    5  
  4.05    
Late Payment of Rent
    5  
       
 
       
ARTICLE V: Taxes, Assessments and Utilities        
  5.01    
Impositions
    5  
  5.02    
Exceptions from Impositions; Charges in Lien of Imposition Proration of Taxes
    6  
  5.03    
Omitted
    6  
  5.04    
Contest of Taxes
    6  
  5.05    
Utilities
    7  
  5.06    
Personal Property Taxes
    7  
       
 
       
ARTICLE VI: Insurance        
  6.01    
Acquisition of Insurance Policies
    7  
  6.02    
Types of Required Insurance
    7  
  6.03    
Terms of Insurance
    8  
  6.04    
Landlord’s Acquisition of Insurance
    8  
  6.05    
Insurance Money and Other Funds Held In Trust
    8  
  6.06    
Application or Proceeds of Physical Damage Insurance
    8  
  6.07    
Cooperation for Insurance Proceeds
    9  
  6.08    
Waiver of Right of Recovery
    9  
       
 
       
ARTICLE VII: Maintenance, Repairs And Alterations        
  7.01    
Alterations — Changes
    9  
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LEASE
CENTURY THEATRES
Table of Contents
                 
            Page No.  
  7.02    
Repairs — Maintenance
    10  
       
 
       
ARTICLE VIII: Environmental Matters        
  8.01    
Definition
    10  
  8.02    
Tenant’s Responsibilities and Landlord Indemnity
    10  
  8.03    
Remedial Work
    11  
  8.04    
Maintenance of Premises
    12  
  8.05    
Landlord’s Responsibilities and Tenant’s Indemnity
    12  
  8.06    
Landlord Inspection
    13  
  8.07    
Effect of Termination
    13  
       
 
       
ARTICLE IX: Improvements        
  9.01    
Tenant’s Signs
    14  
  9.02    
Hold Harmless
    14  
  9.03    
Permits; Compliance With Codes
    14  
  9.04    
Ownership
    14  
  9.05    
Control
    15  
       
 
       
ARTICLE X: Indemnity        
10.01  
Indemnification
    15  
       
 
       
ARTICLE XI: Assignment and Subletting        
  11.01    
Assignment and Subletting
    15  
  11.02    
Notice to Landlord
    16  
       
 
       
ARTICLE XII Encumbrance of Leasehold Estate        
  12.01    
Leasehold Mortgages
    16  
       
 
       
ARTICLE XIII: Mortgage Subordination        
  13.01    
Existing Mortgages
    16  
  13.02    
Future Mortgages
    16  
       
 
       
ARTICLE XIV: Condemnation — Eminent Domain        
  14.01    
Definitions
    16  
  14.02    
Notice to Other Party
    17  
  14.03    
Total Taking — Effect on Rent and Term
    17  
  14.04    
Distribution of Award for Taking
    17  
  14.05    
Partial Taking — Rent Adjustments
    18  
  14.06    
Partial Taking — Option to Terminate
    18  
  14.07    
Separate Tenant’s Award
    18  
       
 
       
ARTICLE XV: Default        
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LEASE
CENTURY THEATRES
Table of Contents
                 
            Page No.  
  15.01    
Tenant’s Default
    18  
  15.02    
Landlord’s Remedies Cumulative
    18  
  15.03    
Landlord’s Default
    20  
  15.04    
Waiver of Redemption
    20  
  15.05    
Dispute Resolution
    20  
  15.06    
Attorney Fees
    21  
       
 
       
ARTICLE XVI: Representations and Warranties        
  16.01    
Landlord’s Representations and Warranties
    21  
  16.02    
Tenant’s Representation and Warranties
    22  
       
 
       
ARTICLE XVII: Damage or Destruction        
  17.01    
Repairs, Alterations and Further Improvements
    22  
  17.02    
Prompt Repair
    22  
  17.03    
Rent Adjustment
    23  
       
 
       
ARTICLE XVIII: Miscellaneous        
  18.01    
Limitation on Liability
    23  
  18.02    
Modification
    23  
  18.03    
Severability
    23  
  18.04    
Governing Law
    23  
  18.05    
Terminology
    23  
  18.06    
Counterparts
    23  
  18.07    
Binding Effect
    23  
  18.08    
Captions
    23  
  18.09    
Notice to Landlord and Tenant
    23  
  18.10    
Addresses for Notices to Landlord and Tenant
    24  
  18.11    
Entire Agreement
    24  
  18.12    
Sale Or Transfer of Premises
    24  
  18.13    
Force Majeure
    25  
  18.14    
Waiver
    25  
  18.15    
Estoppel Certificate
    25  
  18.16    
Number and Gender
    25  
  18.17    
No Holding Over
    25  
  18.18    
Mechanics Liens
    25  
  18.19    
Relationship of Parties
    25  
  18.20    
Time of the Essence
    26  
  18.21    
Facsimile Copies
    26  
  18.22    
Anti-Merger
    26  
       
 
       
Signature Page     26  
 iii

 


 

LEASE
CENTURY THEATRES
Table of Contents
             
        Page No.  
Exhibit A  
Description of Premises
    A-1  
Exhibit B  
Site Plan of Premises
    B-1  
Exhibit C  
Form of Memorandum
    C-1  
Exhibit D  
Guaranty of Lease
    D-1  
 iv

 


 

LEASE
     THIS INDENTURE OF LEASE, dated as of September 30, 1995, by and between SYUFY ENTERPRISES, a California Limited Partnership with an office at 150 Golden Gate Ave., San Francisco, California, hereinafter called “Landlord”, and CENTURY THEATRES OF CALIFORNIA, INC., a California corporation with an office at 150 Golden Gate Avenue, San Francisco, CA 94102, hereinafter called “Tenant”.
RECITALS
     Landlord owns the fee interest in Land, (including land on Vemon Ave.) Buildings, Theatre Improvements and equipment located in the State of California as set forth in Exhibit A.
     Landlord and Tenant wish to provide for the lease by Landlord to Tenant of the Premises.
     NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
EXHIBITS — DEFINITIONS
     1.01 Attachments to Lease and Exhibits
               Attached to this Lease and hereby made a part hereof are the following:
               EXHIBIT A — a description of the Entire Premises.
               EXHIBIT B — a site plan of the Entire Premises including the Leased Premises which is outlined in red and land on Vernon Ave.
               EXHIBIT C — Form of Memorandum of Lease
               EXHIBIT D — Guaranty of Lease
     1.02 Definitions.
               The following terms for purposes of this Lease shall have the meanings hereinafter specified:
               The term “Commencement Date” shall mean October 1, 1995.
               The term “Effective Date” shall mean October 1, 1995.
               The term “Entire Premises” shall mean the Land including Buildings, the Leased Premises, parking; driveways and such other improvements as may presently exist or be added.
               The Term “Initial Rent Due Date” shall mean October 1, 1995.
               The term “Initial Term” is defined in Section 2.02 herein.
               The term “Leased Premises” shall mean Tenant’s Building as set forth in Exhibit B and the land thereunder and the rights, easements and privileges granted to Tenant in this Lease.

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               The term “Mortgage” shall mean any mortgage or deed of trust or other instrument in the nature thereof evidencing a security interest in the Entire Premises or any part thereof.
               The term “Number of Term Years” shall mean ***
               The term “Option Periods” shall mean***      successive separate period of ***      each.
               The term “Percentage Rate” shall mean ***
               The term “Premises” shall mean the Leased Premises.
               The term “Permitted Use” shall mean the construction and operation of a motion picture theatre, and for such activities in connection therewith as are customary and usual at other motion picture theatres operated by Tenant including, without limitation, the operation of vending machines and video games; operation of concession stands; sale of movie related T-shirts, toys and memorabilia, rentals of auditoriums to third parties and other such activities on the Premises.
               The term “Prime Rate” shall be the per annum interest rate from time to time publicly announced by Citibank, N.A. New York, New York as its base rate. The Prime Rate shall be as announced by Citibank, N.A. notwithstanding that Citibank, N.A. may actually charge other rates, and a written statement from Citibank, N.A. as to what the Prime Rate was on any given day shall be deemed conclusive. In the event that Citibank, N.A. should cease to publicly announce its prime rate, the Prime Rate hereunder shall be the prime rate of any one of the then largest banks (based on assets) in the United States as selected by Tenant upon notice to Landlord.
               The term “term of this Lease” or “term hereof’ shall mean the initial term, as provided in the article captioned “Term” and any renewal or extensions thereof.
ARTICLE II
PREMISES — TERM — OPTIONS — COVENANT OF TITLE
     2.01 Lease of Premises.
          A) Landlord leases to Tenant and Tenant leases from Landlord, the Premises, upon the terms and conditions contained herein. Landlord reserves and retains the right to develop the unimproved portion of the Entire Premises so long as it does not interfere with Tenant’s Permitted Use.
          B) The Premises are being leased in their “as is” condition subject to Article VIII herein captioned ‘“Environmental Matters”.
          C) Landlord shall deliver possession of the Premises to Tenant on the Effective: Date, free of all leases, tenancies and occupancies.
     2.02 Term of Lease.
          A) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from Landlord or any person claiming by, from or under Landlord.

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               The “Initial Term” of this Lease shall begin on the Commencement Date and shall terminate ***      thereafter. References herein to the “Lease Term” shall mean the Initial Term of this Lease or the Initial Term as extended under Section 2.02.
     2.03 Option to Extend Lease Term.
          A) Tenant may, at Tenant’s option, extend the Initial Term of this Lease for up to ***      consecutive additional periods of ***     each (individually called a “Renewal Term”), subject to all the provisions of this Lease. The Renewal Term in question shall commence at the expiration of the Initial Term (or the immediately preceding Renewal Term, as the case may be), and shall terminate on the ***     of the date of commencement of the Renewal Term in question, unless sooner terminated as provided herein.
          B) Failure to duly exercise the option for any Renewal Term shall nullify the option for the remaining Renewal Terms.
          C) Tenant’s right to the options to extend the Lease Term and Tenant’s rights to the Renewal Term are subject to:
               (1) This Lease being in full force and effect on the last day of the Initial Term or the then current Renewal Term, as applicable.
               (2) Compliance with the following procedure for exercising the option in question:
                    (a) At least nine (9) months before the last day of the Initial Term, or the then current Renewal Term, as the case may be, Tenant shall give Landlord written notice exercising the option.
                    (b) Each party shall, at the request of the other, execute a memorandum acknowledging the fact that the option in question has been exercised. If an option is properly exercised by Tenant, the failure of Landlord to execute such memorandum shall not invalidate such option or the exercise thereof.
               (3) Tenant is not in default at time of the exercise of the renewal and at the commencement of the renewal term.
     2.04 Covenant of Title: Authority and Quiet Possession: Transfer of Title.
               (A) Landlord represents and warrants to Tenant that: (i) Landlord has full right and lawful authority to enter into and perform Landlord’s obligations under this Lease for the term hereof, and has good an marketable title to the Entire Premises in fee simple, free and clear of all contracts, leases, tenancies, agreements, restrictions, violations, encumbrances or defects in title of any nature whatsoever which would restrict or prevent the use of or enjoyment by Tenant of the Leased Premises or the rights, easements or privileges granted Tenant under this Lease; (ii) this Lease shall not be subject or subordinate to any Mortgage except for such subordination as may be accomplished in accordance with the provisions of the article captioned “Estoppel Certificate; (iii) if Tenant shall have discharged the obligations herein set forth to be performed by Tenant, Tenant shall have and enjoy, during the term hereof, the quiet and undisturbed possession of the Leased Premises and all appurtenances appertaining thereto.

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ARTICLE III
USE OF PREMISES
     3.01 Use.
          A) The Premises may be used for the Permitted Use and for no other purpose.
          B) Tenant shall not use the Premises, or permit the use of the premises, in any manner which constitutes a violation of any laws, regulations, ordinances, statutes or rules governing the premises, or which constitutes a nuisance or waste of which would increase Landlord’s insurance or liability.
          C) Tenant is granted a non-exclusive easement for parking and ingress and egress on and over the Entire Premises as well as the rights under the Easement Agreement with the Neighboorhood Bible Church. Tenant is responsible for all costs associated with the Vernon Ave. land, the Easement Agreement and the Entire Premises exclusive of Landlord’s Buildings.. The location of said easements may be changed at the sole discretion of the Landlord so long as such change does not interfere with Tenant’s Permitted Use.
ARTICLE IV
RENT
     4.01 Minimum Monthly Rent.
          A) Beginning on the Initial Rent Due Date, Tenant shall pay to Landlord during the Lease Term a “Base Rent” of ***      The Base Rent is sometimes referred to herein as the “Minimum Monthly Rent” and shall be subject to adjustment every***      after the Initial Rent Due Date as set forth in Section 4.01 B below.
          B) The Minimum Monthly Rent shall apply from the Rent Commencement Date through the end of the***      Lease Year of the Term. The Minimum Monthly day of the ***      Lease Year and on the first day of each ***      Lease Year thereafter during the Term by a percentage equal to the percentage of increase from the “base period” (as hereinafter defined in this Section) of the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index for All Urban Consumers, San Francisco- Oakland-San Jose Average, Subgroup “All Items”, (1982-84=100) (the “Consumer Price Index”); provided, however, in no event shall the Minimum Monthly Rent be increased by an amount that is less than ***       greater than the Minimum Monthly Rent payable before the adjustment date in question.
     In the event that the Consumer Price Index is not available, the successor or substitute index shall be used for the computations herein set forth. In the event that the Consumer Price Index or such Successor or substitute index is not published, a reliable governmental or other non-partisan publication evaluating the information theretofore used in determining the Consumer Price Index shall be used by Landlord for the computations herein set forth. For the purposes of the computations herein set forth, the basis for any substitute or successor index or such governmental or non-partisan publication shall be converted to a basis of 100 only in the event that the basis used in such index or publication is less man 100.
     4.02 Percentage Rent . In addition to the payment of Base Rent, Tenant shall pay to Landlord for each Lease Year during the Term of this Lease, as Percentage Rent a sum equal to the amount by which***     of the Gross Sales for such Lease Year exceeds the Base Rent which is payable for such Lease Year equal to the quotient obtained by dividing the annual fixed rate for such Lease year by the percentage rate.
          Gross Sales shall mean all box office receipts, sales of goods, merchandise, beverages, food, vending machines and video games. Gross sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city admission taxes, sales taxes and other similar taxes now or hereafter imposed (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and

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actually paid over to the taxing authority by Tenant; commissions paid to agencies or other third parties for selling tickets; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions” and any sums paid to third parties for the use or rental of vending machines, pay telephones or Other amusement machines.
          Tenant agrees to furnish Landlord a statement certified by its chief financial or similar office of its Gross Sales within ninety (90) days after the close of each Lease Year and calculation of Percentage Rent, if any, due for such Lease Year. Tenant shall concurrently with the delivery of such statement, pay to Landlord any Percentage Rent due for such Lease Year.
          The receipt by Landlord of any statement or any payment of Percentage Rent for any period shall not bind it as to the correctness of the statement or the Payment Landlord shall within three years after the receipt of any such statement be entitled to an audit of such Gross Sales. Such audit shall be limited to the determination of the Gross Sales as defined in this Lease and shall be conducted during normal business hours at the principal place of business of Tenant. If it is determined as a result of such audit that there has been a deficiency in the payment of Percentage Rent, then such deficiency shall become immediately due any payable with interest at the annual rate of 18% from the date when said payment should have been made until paid. Any information gained from such statements or inspection shall be confidential and shall not be disclosed other than to carry out the purposes hereof. If such audit shall disclose that Tenant has understated the Gross Sales for such Lease Year by more than three (3%) and Landlord is entitled to any additional Annual Percentage Rent, Tenant shall pay to Landlord all of Landlord’s reasonable cost of such audit.
     4.03 Rent Payments. Rent and other sums to be paid by Tenant shall be payable in lawful money of the United States of America. All payments shall be made by Tenant to Landlord without notice or demand.
     4.04 Place for Payment of Rent. The Annual Rent and any other charges required to be paid by Tenant to Landlord shall be sent to Landlord at its principal place of business, or such other address as Landlord may direct in writing.
     4.05 Late Payment of Rent. In the event that any monthly installment of rent is not paid within ten (10) days after first written notice from Landlord that such payment is past due, Tenant shall pay Landlord interest on such unpaid rent at the rate of eighteen percent (18%) per annum computed from the date such rent installment was due until the date actually paid.
ARTICLE V
TAXES, ASSESSMENTS AND UTILITIES
     5.01 Impositions.
          A) The term “Impositions” shall mean all real estate taxes, duties or assessments (special or otherwise), water and sewer rents, whether ordinary or extraordinary, general or special, foreseen or unforeseen, of any kind and nature whatsoever, which, at any time during the Lease Term, shall be assessed or levied, or be attributable in any manner to the Entire Premises, or the rents receivable therefrom, or any part thereof or any use therein or any facility located therein or used in connection therewith, whether or not any of the foregoing shall be a so-called “real estate tax” expressly excluding, however, any other items arising directly or indirectly out of any act or omission of Landlord, any of Landlord’s predecessors in title or any other person occurring prior to the commencement of the Term. From and after the Initial Rent Due Date, Tenant shall pay all Impositions assessed, levied or attributable to the Entire Premises and/or the Improvements on the Entire Premises. All Impositions or installments thereof payable with respect to the tax year in which this Lease shall commence, and all Impositions or installments thereof with respect to the tax year in which this Lease shall terminate, shall be pro-rated on a daily basis; provided, however, that assessments or escape assessments assessed as a result of this Lease and/or the construction of Tenant Improvements by Tenant shall not be prorated and shall be paid solely by Tenant; and provided further that assessments attributable to Tenant Improvements made in the final year of the Lease shall be paid solely by Tenant if Tenant demolishes the Tenant Building.

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          B) With respect to Impositions which are assessed on any Buildings exclusive of the Entire Premises, Tenant shall pay all such impositions. With respect to Impositions which by law may be paid in installments over a period of time, Tenant shall be deemed to have elected (the “Installment Election”) to pay such Impositions over the longest period of time permitted by law, regardless of whether Tenant has in fact so elected With respect to each year in which the Installment Election is effective and with respect to the Impositions associated with Landlord’s Buildings subject to the Installment Election. Landlord’s share of such Imposition(s) for each year shall be the pro rata share of the amount which would be required to be paid to the collecting authority as if Tenant had in fact made the Installment Election. Landlord shall pay all such real property taxes to the Tenant prior to delinquency. In the event Tenant fails to pay to Landlord such real property taxes as provided herein, Landlord shall pay Tenant in addition interest thereon at the rate of 18% per annum from the delinquency date until such payment has been made.
     5.02 Exceptions from Impositions; Charges in Lieu of Impositions.
          A) Nothing herein contained shall require Tenant to pay any estate, inheritance, succession, capital levy, corporate franchise, gross receipts, transfer, or income tax of Landlord, nor shall any of the same be deemed to be included within the term “Impositions” as defined herein.
           B) Notwithstanding any other provision of this Article V, if at any time after the date of this Lease the present method of taxation or assessment shall be changed so that in lieu of, as a substitute for (whether in whole or in part) or as a supplement to (provided such supplemental tax relate to real estate or revenues form real estate and not to other property or business as well) the taxes now levied, assessed or imposed on real estate and buildings and Improvements thereon, a tax shall be imposed, assessed or levied wholly or party on the Rent, or a tax, assessment, levy or charge, measured or based, in whole or in part, on the Entire Premises or on the rents derived therefrom, shall be imposed on Landlord, then Tenant shall pay taxes so measured or based only to the extent that such taxes would he payable if the Entire Premises were the only property of Landlord subject to such taxes, or the income from operation of the Entire Premises were Landlord’s only income, as the case may be the event of such assessment, Landlord would pay Tenant any such assessment related to any Buildings other than the Lease Premise located on the Entire Premises.
     5.04 Contest of Taxes. Tenant at its sole cost and expense may by appropriate legal proceedings conducted in good faith and with due diligence, contest the amount or validity or application, in whole or in part, of any Imposition or lien therefore, or any other lien, encumbrance or charge against the Premises arising from work done or materials provided to or for Tenant. Tenant shall give Landlord reasonable notice of, and information pertaining to, such contest and regular progress reports with respect thereto. Landlord, shall cooperate with, any effort pursued by Tenant in accordance with this Section 5.04. Tenant shall indemnify, protect and hold harmless Landlord and this Premises from any lien or liability with respect to any such Imposition or contest thereof, including all costs and expenses related thereto. Landlord shall provide Tenant with copies of notice when received by Landlord from the taxing authorities of any assessments or reassessments of the Premises in sufficient time (but in no event later than thirty (30) days after Landlord’s receipt of the same) to enable Tenant to contest the same in accordance with the provisions of this Section 5.04.
     5.05 Utilities. Tenant shall pay before delinquency, directly to the appropriate company or governmental agency, all charges for all utilities, including, but not limited to, water, gas, electricity, sewer, power, telephone, other communication services and refuse disposal consumed on the Entire Premises including the Common Area but exclusive of Landlord’ s buildings.
     5.06 Personal Property Taxes. During the term of this Lease, Tenant shall pay before delinquency any and all personal property taxes levied or assessed against any personal property located upon the Premises. If Tenant fails to timely pay such taxes and a lien is filed against the Premises, Landlord may discharge such lien, it Tenant fails to discharge such lien within ten (10) days following Tenant’s receipt of notice from Landlord, including introit limitation reasonable attorneys’ fees, together with interest at the rate of eighteen percent (138%) per annum from the date of expenditure, such additional rent being due and payable within ten (10) days of notice thereof.

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ARTICLE VI
INSURANCE
     6.01 Acquisition of Insurance Policies. Tenant shall, at its sole cost and expense , procure and maintain, or cause to be procured and maintained, during the entire Term the insurance described in this Section (or its then available equivalent), and shall name Landlord and any other parties requested by Landlord as an additional insured.
     6.02 Types of Required Insurance. Tenant shall procure and maintain the following:
          A) Commercial General Liability Insurance. Commercial general liability insurance insuring against injuries or damages to persons or property sustained in, on or about the Entire Premises (exclusive of the interior of Landlord’s Buildings), Leased Premises, Common Area and the appurtenances thereto, including the sidewalks and alleyways adjacent thereto, with limits of liability no less than Ten Million Dollars ($10,000,000) per occurrence and in the aggregate.
          B) Physical Property Damage Insurance. During the term hereof, Tenant shall Keep Tenant’s Building (excluding foundations, footings and underground improvements) and personal property as well as all Improvements on the Common area, (Landlord’s Buildings excluded), including, but not limited to, signs, outdoor lighting fixtures and fences insured in the name of Landlord and Tenant against damage or destruction by fire and the perils commonly covered under the extended coverage endorsement (with vandalism and malicious mischief coverage) excluding earthquake and flood, but including Builders Risk, to the extent of not less than the full replacement value thereof less any deductible applicable to all of Tenant’s theatres insured under a blanket policy. Tenant shall be responsible for determining the amount of fire and extended coverage insurance to be maintained subject to Landlord’s consent, which consent is not to be unreasonably withheld or delayed. The proceeds of such insurance in case of loss or damage shall be held in trust and applied on account of the obligation of Tenant to repair and/or rebuild the Leased Premises pursuant to the Article captioned “Damage Clause” to the extent that such proceeds are required for such purpose. The insurance required to be carried by Tenant under this paragraph may be covered under a so-called “blanket” policy covering other operations of Tenant and its affiliates. Tenant shall name Landlord and any parties requested by Landlord and any holder of a mortgage on Tenant’s Building pursuant to a standard mortgage clause with respect to the foregoing hazard insurance, provided such holder agrees with Landlord in writing to disburse such insurance proceeds to Landlord for, and periodically during the course of, repair and restoration of Tenant’s Building as set forth in this Lease.
     6.03 Terms of Insurance. The policies required under Section 6.02 shall name Landlord as additional insured. Tenant shall provide to Landlord certificates of insurance and copies of policies obtained by Tenant hereunder promptly upon the request of Landlord. Further, all policies of insurance described in Section 6.02 shall:
          A) Be written as primary policies not contributing with and not in excess of coverage that Landlord may carry.
          B) Contain an endorsement providing that the amount of coverage will not be reduced with respect to landlord except after thirty (30) days prior written notice from insurance company to Landlord and such coverage may not be canceled with respect to Landlord except after thirty (30) days’ prior written notice from insurance company to Landlord.
          C) Expressly provide that Landlord shall not be required to give notice of accidents or claims and that Landlord shall have no liability for premiums.
          D) Be written by insurance companies having a Bests rating of “A-” or better, and such insurance companies shall be reasonably acceptable to Landlord.

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     6.04 Landlord’s Acquisition of Insurance. If Tenant at any time during the Term fails to procure or maintain insurance required hereunder or to pay the premiums therefor, Landlord shall have the right to procure the same and to pay any and all premiums thereon, and any amounts paid by Landlord in connection with the acquisition of insurance shall be immediately due and payable as additional rent, and Tenant shall pay to Landlord upon demand the full amount so paid and expended by Landlord. Any policies of insurance obtained by Landlord covering physical damage to the Premises shall contain a waiver of subrogation against Tenant if and to the extent such waiver is obtainable and if Tenant pays to Landlord on demand the additional costs, if any, incurred in obtaining such waiver.
     6.05 Insurance Money and Other Funds Held in Trust. All insurance money or condemnation proceeds as provided in Article XIV, received by the Tenant shall be turned over to Landlord and held in trust by Landlord and, except as provided otherwise in Section 6.06, shall be applied as follows:
          First, to any Leasehold Mortgage as required under the terms of its Leasehold Mortgage provided that such Mortgage was of record and secured a loan made or committed to Landlord in compliance with all of the terms and conditions of this Lease prior to the occurrence of such loss; second, for the purpose of defraying the cost of repairing, restoring, replacing and/or rebuilding any structure or improvement on or in the Premises as required as provided in Section 6.06 hereof; and third, if the damaged of destroyed structure or improvement is not repaired, restored, replaced or rebuilt as hereinafter provided, said funds shall be disposed of as provided in Section 6.06. Any of said funds in the hands of the Tenant or Landlord at the end of the Term hereof shall be disposed of as set forth in Section 6.06 (A).
     6.06 Application or Proceeds of Physical Damage Insurance. In case of any insurance policies as described in Section 6.02 (B) (Physical Property Damage Insurance) the application of insurance proceeds from damage or loss to property shall be determined in part in accordance with Article XVII hereof and, in the event of any such repair, replacement, restoration or rebuilding, the Landlord shall disburse the proceeds of the insurance collected to Tenant to pay the cost of such work upon certificate of satisfactory progress and/or completion in form satisfactory to Landlord by the licensed architect or engineer in charge of the work. Upon completion of such repair, replacement, restoration or rebuilding in accordance with the provisions of this Lease, and the full payment therefor (so no liens, encumbrances or claims with respect thereto can be asserted against the Premises, this Lease, Landlord or Tenant), any insurance proceeds received by the Landlord or Tenant with respect to the damage or destruction involved, and not used, shall remain the property of Landlord.
          A) Distribution of Unutilized_Proceeds. At the termination of this Lease, such insurance proceeds or condemnation awards received and held by the Landlord and not used for repair, replacement or reconstruction (“Available Proceeds”), shall be disposed as follows:
               (1) First, Landlord shall be awarded an amount sufficient to remove any improvements not repaired and to return the Property to the level of adjacent streets (“grade level”); and
               (2) Second, any remainder shall be paid to Landlord.
     6.07 Cooperation for Insurance Proceeds. Landlord and Tenant shall each cooperate with the other in order to obtain, the largest possible recovery and execute any and all consents and other instruments and take all other actions reasonably necessary or desirable to effectuate the same and cause such proceeds to be paid as hereinbefore provided. Notwithstanding anything to the contrary contained in this Lease, neither party shall carry any insurance concurrent in coverage and contributing in the event of loss with any insurance required to be furnished by the other hereunder if the effect of separate insurance would be to reduce the protection or the payment to be made under such party’s insurance or under the insurance required to be furnished by the other.
     6.08 Waiver of Right of Recovery . Landlord and Tenant hereby release each other from any and all liability and responsibility to one another and, to the extent legally possible to do so on behalf of their respective insurers and anyone claiming through or under either of them, by way of subrogation or otherwise, hereby waive any liability for any and all loss or damage which is of the type covered by fire and extended coverage insurance described in this Article,

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irrespective of any negligence on the part of the other party which may have contributed to or caused such loss. Every insurance policy carried by either party with respect to the Premises or Tenant’s Building or land or improvements adjoining the Premises owned or leased by Landlord shall (if it can be so written and does not result in a material additional premium) include provisions denying to the insurer subrogation rights against the other party and any fee or leasehold mortgage to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. If the waiver of subrogation otherwise is not effective, each party covenants that it will obtain for the benefit of the other party an express waiver of any right of subrogation which the insurer of Such party may acquire against the other party by virtue of the payment of any such loss covered by such insurance. In the event either party is by law, statute, governmental regulation, economically unfeasible or other factor beyond such party’s reasonable control unable to obtain a waiver of the right of subrogation for the benefit of the other party, then, during any period of time when such waiver is unobtainable, said party shall be deemed not to have released any subrogated claim of its insurance carrier against the other party, and during the same period of time the other party shall be deemed not to have released the party who has been unable to obtain such waiver from any claims they or their insurance carriers may assert which otherwise would have been released pursuant to this Section. In the event that either party is unable to obtain such waiver of the right of subrogation for the benefit of the other party, such party shall, within thirty (30) days of receiving notice of such inability, give the other party written notice of such inability.
ARTICLE VII
MAINTENANCE, REPAIRS AND ALTERATIONS
     7.01 Alterations — Changes.
          A) At any time and from time to time during the Lease Term, Tenant may, at its sole expense, make any alterations, additions or changes, whether structural or nonstructural, to any portion or all of any Improvements which may exist at any time and from time to time on any portion of the Premises, and may, at its option, construct new Improvements on the Premises, or remove or demolish Improvements on the Premises, provided that all such alterations or changes in Improvements and new Improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If the change, alteration or addition is structural or exterior in nature Landlord’s written approval shall be first obtained.
          B) Tenant shall at all times keep the Premises or any part thereof, free and clear of all liens and claims for labor or material and free and clear of all attachments, executions and notices.
          (C) Upon termination of this Lease, Tenant may not remove an personal property and trade fixtures including, but not limited to theatre seats, projection and sound equipment, snack bar equipment and computers.
     7.02 Repairs — Maintenance. Tenant shall, at its sole cost and expense, maintain the Entire Premises which shall include the Common Area, driveways, parking, landscaping, signs, fences, lighting and any and all improvements (exclusive of Landlord’s Buildings) in first class condition and make such structural and non-structural, ordinary and extraordinary, foreseen and unforeseen repairs such that the Entire Premises (exclusive of Landlord’s Buildings) shall not be in violation of any law or covenant recorded as of the Effective Date.
ARTICLE VIII
ENVIRONMENTAL MATTERS
     8.01 Definition. For purposes of this Article VIII, the term “Hazardous Material” means (a) any substance, product, waste or other material of any nature whatsoever which is or becomes listed, regulated, or addressed pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section, 9601, et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq,; the Resource Conservation

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and Recovery Act, 42 U.S.C. Section 6901, et esq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Clean Water Act, 33 U.S.C. Section 1251, et seq.; the California Hazardous Waste Control Act, Health and Safety Code Section 25100, et seq.; the California Hazardous Substance Account Act, Health and Safely Code Section 25330, et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code Section 25249.5, et seq.; California Health and Safety Code Section 25280, et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code Section 25170.1, et seq.; California Health and Safety Code Section 25501, et seq. (Hazardous Materials Response Plans and Inventory); or the California Porter-Cologne Water Quality Control Act, Water Code Section 13000, et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, cods, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance or material, as now or at any time hereafter in effect; (b) any substance, product, waste or other material of any nature whatsoever which may give rise to liability under any of the above statutes or under any statutory or common law theory based on negligence, trespass, intentional tort, nuisance or strict liability or under any reported decisions of a state or federal court; (c) petroleum or crude oil, other than petroleum and petroleum products contained within regularly operated motor vehicles; (d) asbestos; (e) subsurface gas; (f) urea formaldehyde foam insulation; (g) poly chlorinated byphenyls (“PCBs”); and freon and other chloroflurocarbons.
     8.02 Tenant’s Responsibilities and Landlord Indemnity.
          A) Tenant shall not cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Tenant, its agents, employees, contractors or invitees, in violation of any law. Upon the expiration or sooner termination of this Lease, Tenant covenants to remove from the Premises, and/or Entire Premises at its sole cost and expense, any and all Hazardous Materials, including any equipment or systems containing Hazardous Materials, which are brought upon, stored, used, generated or released into the environment at or above actionable levels by Tenant, its agents, employees, contractors or invitees. To the fullest extent permitted by law, Tenant hereby indemnifies and defends (with counsel experienced and competent in litigating issues of Hazardous Materials) Landlord and agrees to hold Landlord, the Premises and the Entire Premises free and harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities and losses (including, without limitation, diminution in the value of the Premises, damages for the loss or restriction on use of rentable space or of any amenity of the Premises, and sums paid in settlement of claims, attorneys’ fees, consultant fees and expert fees) which arise directly or indirectly from the presence of actionable levels of Hazardous Materials on, in or about the Premises which is through Tenant’s (or its agents, employees, contractors or invitees) acts or omissions brought upon, stored, used, generated or released into the environment by Tenant, its agents, employees, contractors or invitees (referred to as “Tenant’s Environmental Acts”). This indemnification by Tenant of Landlord includes, without limitation, any and all costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any federal, state or local governmental agency or political subdivision because of the presence of such Hazardous Materials in, on or about the Premises, or the soil or ground water on or under the Premises or any portion thereof due to Tenant’s Environmental Acts. Tenant shall promptly notify Landlord of any release of Hazardous Materials in the Premises, which Tenant becomes aware of during the term of this Lease, caused by Tenant’s Environmental Acts. Landlord agrees to indemnify, defend and hold Tenant harmless from all claims, judgments, damages, penalties, fines, costs, resulting from the presence of Hazardous Materials on or about the Premises, (i) on the Commencement Date of this Lease, and/or (ii) during or after the term of this Lease, if the presence of Hazardous Materials results from any cause other than Tenant’s Environmental Acts.
          B) . Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon Tenant: reports filed pursuant to any self-reporting requirements, reports filed pursuant to any applicable laws or this Lease, all permit applications, permits, monitoring reports, workplace exposure and community exposure warnings or notices and all other reports, disclosures, plans or documents (excluding those which may be reasonably characterized as confidential) relating to water discharges, air pollution, waste generation or disposal, underground storage tanks or Hazardous Materials.

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          C) In addition to Tenant’s routine reporting obligations described in (B) above, Tenant shall promptly notify Landlord of, and shall promptly provide Landlord with true, correct, complete and legible copies of, all of the following environmental items relating to the Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Tenant: all orders, reports, listings and correspondence (excluding those which may be reasonably considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Tenant related to Tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Premises, Tenant shall promptly notify Landlord and provide Landlord with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          D) Landlord, at Tenant’s sole cost and expense, shall have the right, but not the obligation, to join and participate in any legal proceedings or actions initiated in connection with any claims or causes of action arising out of the storage, generation, use or disposal by Tenant, its agents, employees, contractors or invitees, of Hazardous Materials in, on, under or about the Premises caused by Tenant’s Environmental Acts which results in (i) injury to any person, (ii) injury to or any contamination of the Premises or (iii) injury to or contamination of any real or personal property wherever situated. Tenant, at its sole cost and expense, shall promptly take all actions necessary to return the Premises to the conditions existing prior to the introduction of such Hazardous Materials to the Premises and to remedy or repair any such injury or contamination. Notwithstanding the foregoing, Tenant shall not, without Landlord’s prior written consent, which consent shall not be unreasonably withheld or denied or conditioned or delayed, take any remedial action in response to the presence of any Hazardous Materials in, on, under or about the Premises or enter into any settlement agreement, consent decree or other compromise with any governmental agency with respect to any Hazardous Materials claims; provided, however, Landlord’s prior written consent shall not be necessary in the event that the presence of Hazardous Materials in, on, under or about the Premises (i) poses an immediate threat to the health, safety or welfare of any individual or (ii) is of such nature that an immediate remedial response is necessary and it is not possible to obtain Landlord’s consent before taking such action.
     8.03 Remedial Work . In the event any investigation or monitoring of site conditions or any clean-up, containment, restoration, removal or other remedial work (“Remedial Work”) is required (a) under any applicable federal, State or local law or regulation, (b) by any judicial, arbitral or administrative order, (c) to comply with any agreements affecting the Premises or (d) to maintain the Premises in a standard of environmental condition which presents no risk to safety or health, prevents the release of any hazardous materials to adjacent property and otherwise is consistent with the prudent ownership of property of the character of the Premises and/or Tenant’s Building and if such Remedial Work is required as a direct result of Tenant’s Environmental Acts, then Tenant at Tenant’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work; and if such Remedial Work is required for any reason other than Tenant’s Environmental Acts, then, Landlord, at Landlord’s sole cost and expense, including without limitation, any taxes or penalties assessed in connection with the Remedial Work, shall perform or cause to be performed such Remedial Work. All Remedial Work shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental engineer, (ii) pursuant to a detailed written plan for the Remedial Work approved by any public or private agencies or persons with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of the Remedial Work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required permits, licenses or approvals. The selection of the Remedial Work contractors, any disclosures to or agreements with any public or private agencies or parties relating to Remedial Work and the written plan for the Remedial Work (and any changes thereto) each shall be subject to the other party’s prior written approval, which approval shall not be unreasonably withheld, denied, conditioned or delayed. In addition, the party doing the Remedial Work shall submit to the other party, promptly upon receipt or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed removal or other remedial work contracts and similar information prepared or received by such party in connection with any Remedial Work or Hazardous Materials relating to the Premises. In the event the party responsible therefor should fail to

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commence or cause to be commenced in a timely fashion, or fail diligently to prosecute to completion, such Remedial Work, the other party (following written notice) may, but shall not be required to, cause such Remedial Work to be performed, and all costs and expenses thereof, or incurred in connection therewith (i) in the case when Tenant is the responsible party, shall be paid as additional rent due and payable within thirty (30) days of Landlord’s invoice therefor, or (ii) in the case where Landlord is the responsible party, shall be paid by Landlord to Tenant within thirty (30) days of Tenant’s invoice therefor, and if not timely paid by Landlord, in additional to all other rights and remedies, Tenant shall have the right of offset against rent which may become due. Neither party shall be obligated to perform Remedial Work under this Section while it is contesting the application of any law, regulation or order, provided the other party is not exposed to any additional liability, risk or damages. Obligations under this Section are solely for the benefit of the parties, their successors, and assigns and any subtenants of this Lease, and not for any Other third parties.
     8.04 Maintenance of Premises.
          A) Subject to Tenant’s obligation under Section 8.02(A), Tenant at its sole cost and expense shall keep and maintain the Premises in compliance with, and shall not cause or permit the Premises to be in violation of, any federal, state or local laws, statutes, ordinances, orders, guidelines, rules or regulations relating to health and safety, to industrial hygiene or to environmental conditions on, under or about the Premises, including, but not limited to, air, soil and ground water conditions.
          B) Tenant shall be liable and responsible for any Hazardous Materials which Tenant causes to be brought onto the Premises.
     8.05 Landlord’s Responsibilities and Tenant’s Indemnity.
          A) Landlord shall not, without prior advance notice to Tenant, cause or permit any Hazardous Materials to be brought upon, stored, used, generated, released into the environment or disposed of, on, in, under or about the Entire Premises, the Common Area, or any other portion of the Premises by Landlord, its agents, employees, tenants, contractors or invitees, in violation of any law.
          B) Landlord shall promptly notify Tenant of, and shall promptly provide Tenant with true, correct, complete and legible copies of, all of the following environmental items relating to the Entire Premises which may be filed or prepared by or on behalf of, or delivered to or served upon, Landlord: all orders, reports, listings and correspondence (even those which may be considered confidential) of or concerning the release, investigation of, compliance, clean up, remedial and corrective actions, and abatement of Hazardous Materials whether or not required by any applicable laws, including, but not limited to, reports and notices required by any applicable laws, including, but not limited to, reports and notices required by or given pursuant to any applicable laws, and all complaints, pleading and other legal documents filed against Landlord related to Landlord’s or Landlord’s other tenant’s use, handling, storage or disposal of Hazardous Materials. In the event of a release of any Hazardous Materials in, on or about the Entire Premises, Landlord shall promptly notify Tenant and provide Tenant with copies of all reports and correspondence with or from all governmental agencies, authorities or any other persons relating to such release.
          C) Except for the obligations of Tenant as set forth in this Article VIII, Landlord shall exonerate, indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Tenant) and save Tenant and Tenant’s successors and assigns, and their directors, trustees, beneficiaries, officers, shareholders, employees and agents (collectively, Tenant’s “Related Parties”), harmless from and against any claims (including, without limitation, third party claims for personal injury or real or personal property damage), actions, administrative proceedings (including informal proceedings), judgments, damages, punitive damages, penalties, fines, costs, taxes, assessments, liabilities (including sums paid in settlement of claims), interest or losses, including reasonable attorneys’ fees and expenses (including any such fees and expenses incurred in enforcing this provision or collecting any sums due hereunder), consultant fees,, and expert fees, together with all other costs and expenses of any kind or nature (collectively, the “Costs”) that arise directly or indirectly in connection with the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements at, on, about, under or within the Premises, or any portion thereof,

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or elsewhere in connection with the transportation of Hazardous Materials to or from the Premises or the Entire Premises. In the event Tenant or any of its Related Parties shall suffer or incur any such Costs, Landlord shall pay to Tenant or such Related Party the total of all such Costs suffered or incurred by Tenant or such Related party upon demand therefor. Without limiting the generality of the foregoing, the indemnification provided by this Section 8.05 shall specifically cover Costs, including capital, operating and maintenance costs, incurred in connection with any investigation or monitoring of site conditions, any clean-up, containment, remedial, removal or restoration work required or performed by any federal, state or local governmental agency or political subdivision or performed by any nongovernmental entity or person because of the presence, suspected presence, release or suspected release of any Hazardous Materials in or into the air, soil, groundwater, surface water or improvements, at, on, about, under or within the Premises (or any portion thereof), or elsewhere in connection with the transportation of, Hazardous Materials to or from the Premises and any claims of third parties for loss or damage due to such Hazardous Materials.
     8.06 Landlord Inspection. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, to inspect, investigate, sample and/or monitor the Premises, including any soil, water, ground water or other sampling, and any other testing, digging, drilling or analyses, at any time to determine whether Tenant is complying with the terms of this Article VIII, and in connection therewith, Tenant shall provide Landlord with full access to all relevant facilities, records and personnel. If Tenant is in default with any of the provisions of this Article VIII. Landlord and Landlord’s agents and employees shall have the right, but not the obligation, without limitation upon any of Landlord’s other rights and remedies under this Lease, to immediately enter upon the Premises and to discharge Tenant’s obligations under this Article VIII at Tenant’s expense, notwithstanding any other provisions of this Lease. Landlord and Landlord’s agents and employees shall endeavor to minimize interference with Tenant’s business. All sums reasonably disbursed, deposited or incurred by Landlord in connection therewith, including, but not limited to, all costs, expenses and actual attorneys’ fees, shall be due and payable by Tenant to Landlord, as an item of additional rent, on demand by Landlord, together with interest thereon at the rate often percent (10%) per annum.
     8.07 Effect of Termination.
          A) Upon termination of this Lease, Tenant shall advise Landlord in writing whether or not, to the best of Tenant’s knowledge. Tenant is in default of any provision of this Article VIII and if it is in default, the specific nature of such default.
          B) All liabilities of Landlord and Tenant, respectively, under this Article VIII, accrued as of the date this Lease terminates, shall survive such termination.
ARTICLE IX
IMPROVEMENTS
     9.01 Tenant’s Signs.
          (A) Except for signs located on the Premises at the commencement date of this lease or signs which are located wholly within the interior of the premises and which are not visible from the exterior of the premises, no signs shall be placed, erected, maintained or painted at any place upon the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld. All such signs shall be maintained at Tenant’s sole expense.
          (B) Landlord hereby agrees that Tenant shall have the right to maintain the following signs (at Tenant’s sole expense);
               (1) Illuminated signs on the exterior walls of Tenant’s Building and on the theatre canopy or marquee.

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               (2) Signs on the interior or exterior of any windows of Tenant’s Building.
               (3) Easel or placard signs within the lobby entrance or on sidewalks immediately in front of Tenant’s Building, provided the same do not unreasonably interfere with pedestrian traffic.
     9.02 Hold Harmless. Except to the extent attributable to the intentional or negligent acts or omissions of Landlord or Landlord’s agents, employees, contractors, tenants, or invitees, Tenant shall indemnify, protect, defend and hold harmless Landlord and the Premises from and against all claims and liabilities arising by virtue of or relating to construction of the Improvements or repairs made at any rime to the Premises including repairs, restoration and rebuilding and all other activities of Tenant on or with respect to the Premises. If Tenant is required to defend any action or proceeding pursuant to this Section to which action or proceeding Landlord is made a party, Landlord shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its election, by counsel of its own choosing, and to the extent Landlord is indemnified under this Section, Tenant shall bear the cost of Landlord’s defense, including attorney’s fees; provided, however, Tenant shall be liable for attorney’s fees only if single legal counsel (or a single firm of legal counsel) cannot represent both Landlord and Tenant without there arising an actual or potential conflict of interests.
     9.03 Permits: Compliance With Codes. All building permits and other permits, licenses, permissions, consents and approvals required to be obtained from governmental agencies or third parties in connection with construction of the Improvements and any subsequent improvements, repairs, replacements or renewals to the Premises shall be acquired as required by applicable laws, ordinances or regulations. Landlord agrees to cooperate reasonably with Tenant and all governmental authorities having jurisdiction. Tenant shall cause all work on the Premises during the Term to be performed in accordance with all applicable laws and all directions and regulations of all governmental agencies and the representatives of such agencies having jurisdiction.
     9.04 Ownership.
          A) During the Term of this Lease (including any renewals or extensions), the Improvements erected, constructed or located within the Premises, including without limitation all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein, shall be and remain the property of Tenant. At the expiration or earlier termination of this Lease, the Improvements and all additions, alterations and improvements thereto or replacements thereof and all appurtenant fixtures, machinery and equipment installed therein including moveable trade fixtures and personal property of shall become the property of landlord.
          B) During the term of this lease, Tenant shall have the right to replace any of the trade fixtures, theatres seats, projection equipment, furniture, other equipment and personal property from time to time; provided, however, that such replacement fixtures, equipment or property are of equal or better quality than the property being replaced. Further no such installation or removal thereof shall affect the structural portion of the Premises and that Tenant shall repair and restore any damage or injury to the Premises or the Property caused thereby. Any such replacement equipment, furniture or fixtures shall become the property of the Landlord at the termination of this lease.
     9.05 Control. Notwithstanding anything to the contrary in this Lease, during the Term of this Lease Tenant shall have exclusive control and possession of the Premises.
ARTICLE X
INDEMNITY
     10.01 Indemnification . Except to the extent attributable to the intentional and gross negligent acts or omissions of Landlord and its agents, employees, tenants, licensees and contractors, Tenant shall indemnify, pay and protect, defend and hold harmless (with counsel reasonably approved by Landlord) and save Landlord (and its successor, assigns and any successor fee owners of the Premises), and all of their directors, officers, employees and agents, hereinafter referred to as

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“Landlord Indemnities”, from and against any claims, demand, damages, injuries, costs, expenses, losses, liabilities, causes of action, interest, fines, charges and penalties (including reasonable legal fees and expenses in enforcing this indemnity and hold harmless), or liability in connection with loss of life, personal injury or damage to property caused to any person in or about the Premises from whatever cause, in any way connected directly or indirectly and arising out of or attributable in any way connected with Tenant’s use or possession of the Premises, including any liability for injury, death, loss or damage to Tenant, or its agents, contractors, employees, customers, visitors and persons with whom they deal. The provisions of this paragraph shall survive the termination of this lease.
ARTICLE XI
ASSIGNMENT AND SUBLETTING
     11.01 Assignment and Subletting.
          A) Tenant may assign the Lease and may sublease a portion or all of the Premises, subject to Landlord’s approval which shall not be unreasonably withheld, provided Tenant remains liable for all Tenant obligations under this Lease, and any sublease shall be subject to all the provisions of this Lease.
          B) Any assignment of this lease or any sublease of a portion or all of the Premises shall be subject to the terms and conditions of this Lease.
          C) Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may without landlord’s consent, sublet the Leased Premises or assign this Lease (a) to any corporation which may, as the result of a reorganization, merger, consolidation, or sale of assets succeed to the business now carried on by Tenant, or (b) to any subsidiary or affiliate corporation of Tenant or of Tenant’s parent corporation (“Parent Corporation”) (so long as such corporation remains a subsidiary or affiliate of Tenant or of Tenants Parent Corporation), or (c) to Tenant’s Parent Corporation, or (d) to any corporation which acquires 50% or more of the issued and outstanding voting stock (or such lesser percentage as shall be sufficient to acquire voting control) of Tenant or of Tenant’s Parent Corporation, or (e) to any corporation which operates motion picture theatres and has a book net worth of not less than $30,000,000.00 as of the end of the calendar month during which any such assignment or subletting becomes effective and to any subsidiary or affiliate of such corporation, provided that such corporation duly and validly then guarantees the performance of the obligations of such subsidiary or affiliate under this Lease.
     11.02 Notice to Landlord. Tenant shall give notice to Landlord of any assignment of the Lease or sublease of the Premises within ten (10) days after such event.
ARTICLE XII
ENCUMBRANCE OF LEASEHOLD ESTATE
     12.01 Leasehold Mortgages.
          A) Tenant may not take back a Purchase Money Leasehold Mortgage of the Leasehold Estate or otherwise encumber Tenant’s Leasehold Estate or assign this Lease as security for a Mortgage or Mortgage.
          B) Tenant shall not place or create any mortgage, deed of trust, or other lien or encumbrance affecting Landlord’s fee interest in the Land or Landlord’s interest in this Lease.

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ARTICLE XIII
MORTGAGE SUBORDINATION
     13.01 Existing Mortgages. If there is a mortgage or deed of trust (“Mortgage”) lien affecting the interest of Landlord in the Premises, then Landlord shall obtain and shall deliver to Tenant within fifteen (15) days after the Effective Date, a non-disturbance and attornment agreement in a form reasonably acceptable to such lender, Landlord and Tenant, executed by the Mortgagee (as defined below), wherein the Mortgagee shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any judicial foreclosure, private sale or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction.
     13.02 Future Mortgages. The rights of Tenant under this Lease shall be, at the option of Landlord, either subordinate or superior to any future mortgage on Landlord’s interest in the Premises in favor of an institutional lender not affiliated with Landlord. Provided however, that as a condition to any subordination of this Lease, the mortgagees or beneficiaries of any deed of trust and their successors and assigns (the “Mortgagee”) shall agree to recognize the interest of Tenant and abide by the terms of this Lease in the event of any foreclosure or deed in lieu of foreclosure, including the right to quiet enjoyment of the Premises, without any condition, limitation or restriction. As a further condition of such subordination, Landlord, Tenant and the Mortgagee shall enter into a non-disturbance and attornment agreement in a form reasonably acceptable to all parties executing such instrument.
ARTICLE XIV
CONDEMNATION — EMINENT DOMAIN
     14.01 Definitions. The following definitions apply in construing provisions of this Lease relating to a taking of or damage to all or any part of the Entire Premises or Improvements or Parking of any interest in them by eminent domain or inverse condemnation:
          A) “Taking” means that taking or damaging, including severance damage, by eminent domain or by inverse condemnation for any public or quasi-public use under any statute. The transfer of title may be either a transfer resulting from the recording of a final order in condemnation or a voluntary transfer or conveyance to the condemning agency or entity under threat of condemnation, in avoidance of an exercise of eminent domain, or while condemnation proceedings are pending. The Taking shall be considered to take place as of the date on which the right to compensation and damages accrues under the law applicable to the Premises, unless the condemnor also takes actual physical possession of the Premises or a part thereof, in which case the date of Taking for the purposes of this Lease shall be the later of the date on which the right to compensation and damages accrues or the date physical possession is taken by the condemnor.
          B) “Total Taking” means the Taking of the fee title to all the Premises and the Improvements on the Premises, which shall be considered to include any offsite improvements effected by Tenant to serve the Premises or the improvements or the parking on the Premises.
          C) “Partial Taking” means any Taking (including any damaging) of a portion of the Premises, the Common Area, or any Improvements or parking thereon which is not a Total Taking.
          D) “Notice of Intended Taking” means any notice or notification on which a reasonably prudent man would rely and which he would interpret as expressing an existing intention of Taking as distinguished from a mere preliminary inquiry or proposal. It includes, but is not limited to, the service of a condemnation summons and complaint on a party to this Lease. The notice is considered to have been received when a party to this Lease receives from the condemning agency or entity a Notice of Intended Taking, in writing, containing a description or map of the Taking reasonably defining the extent of the Taking.

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          E) “Award” means compensation paid for the Taking, whether pursuant to judgment or by agreement or otherwise.
     14.02 Notice to Other Party. The party hereto receiving any notice of the kinds specified below shall promptly give the other party notice of the receipt, contents, and dale of the notice received:
          A) Notice of Intended Taking,
          B) Service of any legal process relating to condemnation of the Premises or improvements;
          C) Notice in connection with any proceedings or negotiations with respect to such a condemnation; or
          D) Notice of intent or willingness to make or negotiate a private purchase, sale or transfer in lieu of condemnation
     14.03 Total Taking — Effect on Rent and Term. On a Total Taking, Tenant’s obligation to pay Rent shall terminate on, and Tenant’s interest in the leasehold shall continue until, the date of Taking, at which time this Lease shall terminate.
     14.04 Distribution of Award for Taking. On a Taking, all sums, including, but not limited to, damages and interest awarded for the value of the real estate taken, shall be apportioned and paid by the governmental body taking the Premises as follows:
          A) To Landlord, the amount awarded, if any, for the Fair Market Value of all buildings and other improvements on the Premises;
          B) To Landlord, the amount awarded, if any, for severance damages
          C) To Landlord, the amount awarded, if any, for the “bonus value” of this lease hold estate. The bonus value is the amount by which the fair market rental value on the open market exceeds the contract rent (the amount called for in this Lease);
          D) To Tenant, the amount awarded, if any, for loss of goodwill and relocation expanses;
          E) To Landlord, any other award which will not reduce the amount which otherwise would be awarded to Tenant; and
          F) To Landlord, any balance.
Tenant shall only be entitled to payments under this Section 14.04 out of amounts awarded by the governmental body taking the Premises.
     14.05 Partial Taking — Rent Adjustments. On a Partial Taking, the Lease shall remain in full force and effect covering the remaining Premises, except that the total Rent as otherwise provided herein shall be reduced in the same ratio as the percentage of the area of the Premises taken bears to the total area of the Premises.
     14.06 Partial Taking — Option to Terminate. Notwithstanding anything herein to the contrary, in the event of a Partial Taking, if more than thirty percent (30%) of the Building or fifty (50%) of the parking is taken by a condemnation or sold under the threat of condemnation, then Tenant may terminate this Lease as of the date the condemning authority takes title or possession, whichever occurs first, by delivering written notice to the other within ten (10) days after receipt

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of written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority takes possession).
     14.07 Separate Tenant’s Award In the event of a Taking, Tenant may make a separate claim with respect to lost business, lost profits, goodwill, moving expenses and other related damages against the acquiring governmental Agency.
ARTICLE XV
DEFAULT
     15.01 Tenant’s Default. The occurrence of any of the following shall constitute a default or event of default by Tenant:
          A) Failure to pay Annual Rent or any other monetary amount when due as provided herein, if the failure continues for ten (10) days after first written notice has been given to Tenant by Landlord;
          B) Failure to perform any of Tenant’s non-monetary obligations under this Lease, provided however, Tenant shall have thirty (30) days from receipt of written notice by Landlord to cure each such default. If Tenant cannot reasonably cure such default within said thirty (30) day period, Tenant shall not be in default of this Lease if Tenant commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the breach.
          C) Tenant shall file a petition in voluntary bankruptcy under the bankruptcy code of the United States or any similar Law, State or Federal Law, now or hereafter in effect.
     15.02 Landlord’s Remedies Cumulative. Landlord shall have the following remedies set forth in, subsections (A) through (G) below if Tenant commits a default, except as provided in Section 15.03. These remedies are not exclusive and may be exercised concurrently or successively; they are cumulative in addition to any remedies now or later allowed by law or equity:
          A) Bring Suit for Performance. Landlord may bring suit for the collection of the Rent or other amounts for which Tenant is then in default, or for the performance of any other covenant or agreement devolving upon Tenant, all without having to enter into possession or terminate this Lease;
          B) Re-Entry Without Termination. Pursuant to California Civil Code Section 1.954.4, Landlord may re-enter the Premises, by legal proceedings (or without legal proceedings if the Premises have been abandoned), and take possession thereof, without thereby terminating this Lease, and thereupon Landlord may expel all persons and remove all property therefrom, without becoming liable to prosecution therefor, and relet the Premises or a portion or portions thereof, and receive the rent therefrom, applying the same first to the payment of the reasonable expenses of such re-entry and the reasonable cost of such reletting, and then to the payment of the Rent and other amounts for which Tenant is then in default; the balance, if any, to be paid to Tenant, who, whether or not the Premises are relet, shall remain liable for any deficiency. It is agreed that the commencement and prosecution of any action by Landlord in forcible entry and detainer, ejectment, or otherwise, or the appointment of a receiver, or any execution of any decree obtained in any action to recover possession of the Premises, or any re-entry, shall not be construed as an election to terminate this Lease unless Landlord shall, in writing, expressly exercise its election to declare the Lease Term hereunder ended and to terminate this Lease, and unless this Lease be expressly terminated, such re-entry or entry by Landlord, whether had or taken under summary proceedings or otherwise, shall not be deemed to have absolved or discharged Tenant from any of its obligations and liabilities for the remainder of the Lease Term. Notwithstanding anything to the contrary or other provisions of this Section 15.02(B), Tenant shall have the right to sublet the Premises, assign its interest: in the Lease, or both, subject to Landlord’s prior right, during any continuance of Tenant’s default, to relet the Premises or a portion or portions thereof.
          

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          C) Termination of Lease and Lessee’s Right to Possession. No act by Landlord, other than giving Tenant written notice of termination of this Lease, shall in fact terminate the Lease. Upon termination of the Lease, neither Landlord nor Tenant shall have any future rights or obligations under the Lease except that Landlord stall have the right to recover from Tenant the following:
               (1) The worth, at the time of the award, of the unpaid Rent that had been earned at the time of termination of this Lease;
               (2) The worth, at the time of the award, of the amount by which the unpaid Rent that would have been earned after the date of termination of this Lease until the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided;
               (3) The worth, at the lime of the award, of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of the loss of Rent that Tenant proves could have been reasonably avoided; and
               (4) Any other amount, and court costs, necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform his obligations under the Lease or which, in the ordinary course of things, would be likely to result therefrom.
               (5) For any other sums due.
          D) Definitions. As used herein, the following phrases shall be interpreted as follows:
               (1) “The worth, at the time of the award,” as used in subsections 15.02(c)(1) and (2) above, is to be computed by allowing interest at the maximum lawful rate. “The worth, at the lime of the award,” as referred to in subsection 15.02(C)(3) above, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).
               (2) As used herein, the term “time of award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as hereinabove set forth or the date of entry of any determination, order, or judgment of any court or other legally constituted body determining the amount recoverable, whichever first occurs.
          E) Surrender. Promptly after notice of termination, Tenant shall surrender and vacate the Premises and all improvements in broom-clean condition, and Landlord may re-enter and take possession, of the Premises and all remaining improvements and eject all parties in possession or eject some and not others, or eject none. Termination under subsection 15.02(C) shall not relieve Tenant from the payment of any sum due to Landlord or from any claim for damages previously accrued or then accruing against Tenant.
          F) Appointment of Receiver. If Tenant defaults under Section 15.02 Landlord shall have the right to have a receiver appointed to collect rent from any subtenants. Neither the filing of a petition for the appointment of a receiver nor the appointment itself shall constitute an election by Landlord to terminate this Lease.
          G) Landlord’s Right to Cure Tenant’s Default. Landlord, at any time after Tenant is in default under Section 15.01 herein, may cure the default at Tenant’s expense. If Landlord, at any time, by reason of Tenant’s default, pays any sum or does any act that requires the payment of any sum, the sura paid by Landlord shall be immediately reimbursed from Tenant to Landlord, together with interest at eighteen percent (18%) per annum computed from the date of such expenditure until the date of reimbursement by Tenant.

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15.03 Landlord’s Default .
          A) The occurrence of the following shall constitute a default by Landlord: Breach of any provision of this Lease if the breach is not cured within thirty (30) days after written notice by Tenant; provided, however, that if the breach cannot reasonably be cured within such thirty (30) day period, Landlord shall not be in default of this Lease if Landlord commences to cure the breach within the thirty (30) day period and diligently and in good faith continues to cure the default.
          B) Tenant, at any time after Landlord is in default under paragraph (A) above, may cure the default at Landlord’s expense. If Tenant at any time, by reason of Landlord’s default, pays any sum or does any act that requires the payment of any sum, the sum paid by Tenant shall be immediately reimbursed by Landlord, together with interest at eighteen percent (18%) per annum determined at the time the expenditure is made by Tenant computed from the date of such expenditure until the date of reimbursement by Landlord. If Landlord fails to make such payment(s) within fifteen (15) days after Tenant’s written demand, Tenant shall be entitled to offset any amount due from Landlord against the next Rent payment due under this Lease.
     15.04 Waiver of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being dispossessed or removed from the Premises upon the termination of this Lease because of default by Tenant hereunder.
     15.05 Dispute Resolution . Landlord and Tenant desire by provisions of this Section 15.05 to establish procedures to facilitate the informal and inexpensive resolution of any dispute arising out of this Lease by mutual cooperation and without resort to litigation. To accomplish this objective, Landlord and Tenant agree to follow the procedures set forth below if and when a dispute arises between them under this Lease.
          A) Description of Dispute. The complaining party shall provide by notice a written description of the alleged breach by the other party. This description shall explain the nature of the complaint and the Lease provision(s) on which it is based. The complaining party shall also set forth a proposed solution to the problem including a specific time frame within which the parties must act. The party receiving the letter of complaint must respond in writing within ten (10) days with an explanation, including references to the relevant parts of the Lease and a response to the proposed solution. Within ten (10) days of receipt of this response, the parties must meet and discuss options for resolving the dispute. The complaining party must initiate the scheduling of the resolution meeting.
          B) Mediation. A settlement conference shall be held within thirty (30) days of the unsuccessful resolution meeting or as soon as practical thereafter. The settlement conference shall be held in the County of San Francisco, California.
          C) Arbitration. With respect to disputes which the parties have been unable to resolve informally or by mediation, the parties agree to submit the dispute for final and binding arbitration if the dispute has not otherwise been settled. The parties agree that the arbitration must be initiated within one (1) year after the date of the written description of the alleged breach and that the failure to initiate arbitration within the one (1) year period constitutes an absolute bar to the initiation of any proceedings. An arbitration shall be deemed initiated for the purposes of this section by demand therefor being sent by certified mail to the other party which notice shall contain a description of the dispute, the amount involved and the remedies sought. The parties shall have the right to representation by counsel throughout the arbitration proceedings. All rulings, decisions, and awards of the arbitrators shall be in conformance with California law. The award may be judicially enforced pursuant to §1285 et seq of the California Code of Civil Procedure. Each party shall bear their own costs of legal counsel and the fees for witnesses, unless otherwise determined by the arbitrator as part of the award. The parties may establish the scope of discovery by agreement. If the parties cannot agree, the arbitrator will have discretion to define the limits of discovery and to allow discovery upon a showing of good cause, utilizing the following guidelines:

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               (1) The arbitrator shall balance the benefits of discovery against the burdens and expenses to the parties and the goals of arbitration as an alternative to traditional litigation.
               (2) The arbitrator shall have discretion to order pre-hearing exchange of information, including but not limited to, the production of requested documents and exchanges of summaries of testimony of proposed witnesses.
               (3) The deposition of the claimant(s) and respondent(s) and form sets of interrogatories approved by the Judicial Council shall be allowed as a matter of right. There shall be an early and prompt designation and exchange of the names and addresses of expert witnesses who may be called upon to testify at the arbitration hearing. Their depositions, special interrogatories, requests for admission and all other discovery shall be allowed only upon a showing of good cause.
15.06 Attorneys’ Fees. Should any action or proceeding, be commenced between the parties to this Lease concerning said Premises, this Lease, or the rights and duties of either in relation thereto, the party, Landlord, or Tenant, prevailing in such action or proceeding shall be entitled, in addition to such other relief as may be granted in the action or proceeding, to a reasonable sum as and for its attorneys’ fees therein which shall be determined by the arbitrator(s) hearing such action or proceeding.
ARTICLE XVI
REPRESENTATIONS AND WARRANTIES
     16.01 Landlord’s Representations and Warranties. Landlord represents and warrants:
          A) Landlord is the fee owner of the Premises.
          B) The persons executing this Lease in behalf of Landlord are authorized to execute the same on behalf of Landlord and Landlord’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Landlord is a party.
          C) To the best of Landlord’s knowledge there is no claim, suit, demand or litigation, or administrative proceeding, or condemnation, eminent domain or similar proceeding pending or threatened with respect to the Premises or the Entire Premises, nor does Landlord know or have reasonable grounds to know of any basis for such action.
          D) Tenant shall at all times during the Term of this Lease have the right to peacefully and quietly have, hold, occupy and enjoy the Premises, subject to the terms of this Lease without hindrance or molestation from landlord or any person claiming by, from or under Landlord.
          E) Landlord is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its liabilities exceed its assets
          F) The title to the Premises and the Entire Premises is vested in Landlord, subject to no defects or encumbrances created by Landlord except as disclosed to Tenant in writing by Landlord prior to the Effective Date.
          G) Except for liens or encumbrances created by or through Tenant, or based upon Impositions which are the responsibility of Tenant under this Lease, Landlord shall not, after the date hereof, agree to or create or permit or suffer to be created any liens or encumbrances on the Premises which are (i) not specifically stated in writing to be junior to this Lease, or any New Lease (as defined herein), or (ii) which are inconsistent with the obligations of

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Landlord hereunder, and Landlord shall, at or prior to the commencement of the Term, cause the Premises to be free of all liens and encumbrances.
     16.02 Tenant’s Representations and Warranties . Tenant represents and warrants:
          A) Tenant is a California corporation in good standing.
          B) The persons executing this Lease in behalf of Tenant are authorized to execute the same on behalf of Tenant and Tenant’s obligations under this Lease are legally binding, do not require the consent of any other parties and do not violate the provisions of any agreement to which Tenant is a party.
          C) Tenant is not now insolvent either in the sense that it cannot pay its current bills as they come due or that its Liabilities exceed its assets.
ARTICLE XVII
DAMAGE OR DESTRUCTION
     17.01 Repairs, Alterations and Further Improvements.
          A) Tenant’s Obligation to Repair. If the Premises or the improvements to the common Area are damaged by any peril after the Commencement date of the Lease, Tenant shall restore the Leased Premises or the Common Area improvements unless the Lease is terminated pursuant to Section 17.01 B. If this Lease is not so terminated, then upon receipt of the insurance proceeds by Landlord (if insurance proceeds are available) and the issuance of all necessary governmental permits, Tenant shall promptly commence and diligently prosecute to completion the restoration of the Leased Premises to the extent then allowed by Law, to substantially the same condition in which the Leased Premises or the Common Area improvements were immediately prior to such damage.
          (B) Damage in Excess of Fifty Percent (50%). If the cost of repairing or reconstructing said damage or destruction to its former condition and form is in excess of Fifty percent (50%) and if such reconstruction or rebuilding cannot be made under then existing laws, ordinances, statutes or regulations of any governmental authority applicable thereto the Term shall end as of the date of such damage or destruction. If, however, such reconstruction or rebuilding can be made under such existing laws, ordinances, statutes and regulations (or can be so made with minor and non-material changes to the former condition and form of the property damaged or destroyed), Tenant shall effect such repair or restoration.
     17.02 Prompt Repair. If Tenant, pursuant to the terms hereof, is obligated to repair, replace, reconstruct or rebuild any structures, improvements or other property as hereinabove provided, the same shall be effected at Tenant’s cost and expense (which may be paid from insurance proceeds available as above provided) and Tenant shall diligently commence and continuously carry out such repair, replacement, reconstruction or rebuilding, to full completion as soon as possible, except to the extent of delays due to strikes, lockouts, shortages of labor or materials after due diligence in obtaining the same governmental restrictions, fire, casualty, riot, act of God, act of the public enemy, or other causes beyond the reasonable control of Tenant after the exercise of due diligence, including diligence in contracting, and the exercise of rights under contracts, with contractors and suppliers.
     17.03 Rent Adjustment. This Lease and the Term shall not terminate or be terminated because of damage to or destruction of any structure or improvement on or in the Premises except under and in accordance with the provisions hereinabove contained. If such damage or destruction occurs and renders all or a portion of the Improvements on the Premises untenantable, Rent shall not be abated Tenant shall not be entitled to any compensation or damages from Landlord for loss of Tenant’s property or any inconvenience or annoyance caused by such restoration.

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ARTICLE XVIII
MISCELLANEOUS
     18.01 Limitation on Liability. The liability of Landlord hereunder or in connection with the Premises or Entire Premises shall be limited to its interest in the Premises and/or Entire Premises, as the case may be, and in no event shall any other assets of Landlord be subject to any claim arising out of or in connection with the Lease, Premises, or Entire Premises.
     18.02 Modification . No modification, waiver, amendment, discharge, or change of this Lease shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is or may be sought.
     18.03 Severability. In the event any term, covenant, condition, provision, or agreement contained herein is held to be invalid, void, or otherwise unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or enforceability of any other term, covenant, condition, provision, or agreement contained herein.
     18.04 Governing Law. This Lease and the obligations of the parties hereunder shall be interpreted, construed, and enforced in accordance with the laws of the State of California and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by Law.
     18.05 Terminology. All personal pronouns used in this Lease, whether used in the masculine, feminine, or neuter gender, shall include all other genders; the singular shall include the plural and vice versa. “Business Day” means other than a Saturday, Sunday, or holiday. In the event that the time for performance of an act under this Lease fails on a Saturday, Sunday, or holiday, the date for performance of such act shall be extended to the next Business Day.
     18.06 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original agreement, and all of which shall constitute one agreement by each of the parties hereto.
     18.07 Binding Effect . Except as otherwise herein provided, this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
     18.08 Captions. Article and section titles or captions contained herein are inserted as a matter of convenience and for reference, and in no way define, limit, extend, or describe the scope of this Lease or any provisions hereof. All reference to section numbers herein shall mean the sections of this Lease.
     18.09 Notices to Landlord and Tenant .
          A) Except as otherwise in this Lease provided, a bill, demand, statement, consent, notice or communication which Landlord may desire or be required to give to Tenant shall be deemed sufficiently given or rendered if in writing, delivered personally to Tenant or sent by certified (return receipt requested) or private express mail courier (postage fully prepaid) addressed to Tenant to the addresses set forth in Section 18.10 below or at such other address(es) as Tenant shall designate by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder by certified or private express mail carrier.
          B) Any notice, request, demand or communication by Tenant to Landlord must be in writing and delivered personally to Landlord or sent by certified (return receipt requested) or private express courier (postage fully prepaid), addressed to Landlord to the addresses set forth in Section 18.10 below or at such other address(es) as Landlord shall designate by notice given as herein provided. If Tenant is notified of the identity and address of Landlord’s mortgagee or beneficiary under a deed of trust, or ground or underlying lessor, Tenant shall give such party notice of any default by Landlord hereunder by certified or private express mail carrier.

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          C) The time of the rendition of such bills or statements and of the giving of such consents, notices, demands, requests or communications (collectively “notice”) by Tenant or Landlord shall be deemed to be the earlier of (i) the date received by Tenant with respect to a notice to Tenant, and the date received by Landlord with respect to a notice to Landlord (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier (e.g., Federal Express or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice, request, demand, or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice, request or demand sent.
     18.10 Addresses for Notices to Landlord and Tenant
     Notices to are to be delivered, mailed or couriered to the following address(es):
     
To Landlord:
  Syufy Enterprises
150 Golden Gate Ave.
San Francisco, CA 94102
Attn: Real Estate Department
 
   
To Tenant:
  Century Theatres of California, Inc.
150 Golden Gate Avenue
San Francisco, CA 94102
 
  Attention: Legal Department
Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     18.11 Entire Agreement. This Lease and the exhibits attached set forth the entire agreement between the parties. Except as specifically set forth herein, there are no agreements, representations, or warranties whatsoever as to any matter. Any prior agreements, conversations, or writings are merged herein, superseded hereby, and extinguished.
     18.12 Sale or Transfer of Premises. Landlord shall promptly notify Tenant in writing of any sale or transfer of the Premises or any assignment of Landlord’s interest in this Lease, giving the name and address of the assignee or new owner, as the case may be, and instructions regarding the payment of rent or any other amount required to be paid by Tenant hereunder. In the event of any transfer or assignment of Landlord’s interest in this Lease or any change in, or transfer of, title in and to the Premises of any part thereof, whether voluntary or involuntary, or by act of Landlord or by operation of law, Tenant shall be under no obligation to pay rent or other charges payable by Tenant to Landlord hereunder, thereafter accruing, until Tenant shall have been notified in writing of such transfer, assignment, or change in title, and given satisfactory proof thereof, and the withholding of rent or other charges payable by Tenant to Landlord hereunder, in the meantime shall not be deemed a default upon the part of Tenant Landlord may assign this Lease and convey its title to the Premises, subject to this Lease, at any time. In the event of such assignment of this Lease, Landlord shall have no further obligations under this Lease, except for liabilities which shall have accrued prior to the date of such assignment and transfer and that the assignee assumes in writing Landlord’s obligations hereunder accruing on and after the effective date of the assignment.
     18.13 Force Majeure. In the event that Tenant shall be delayed or hindered in or prevented form the performance of any act other than Tenant’s obligation to make payments of rent, and other charges required hereunder, by reason of strikes, lockouts, unavailability of materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, the default of Landlord, war, or other reason beyond its control, then performance of such act shall be excused for the period of the delay, and the period for the performance of such act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, lack of funds shall not be deemed to be a cause beyond the control of Tenant.

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     18.14 Waiver. No term, covenant, or condition of this Lease can be waived except in writing, signed by the party making the waiver, Landlord or Tenant, as the case may be. No waiver of any default hereunder shall be implied from any omission by either party to take any action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the express waiver, and that only for the time and to the extent therein stated. The acceptance by Landlord of Rent or partial Rent with knowledge of the breach of any of the covenants of this Lease by Tenant shall not be deemed a waiver of any such breach. One or more waivers of any breach of any covenant, term, or condition of this Lease shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by either party shall not be deemed to waive or render unnecessary that party’s consent to or approval of any subsequent similar act.
     18.15 Estoppel Certificate. Either party hereto shall, within twenty (20) days notice from the other party (referred to as the “Requesting Party”), execute and deliver to the Requesting Party, in recordable form, a certificate stating that this Lease is unmodified and in full force and effect, or in full force and effect as modified, and stating the modifications. The certificate also shall state the amount of current monthly rent, the dates to which the rent has been paid in advance, the amount of prepaid rent, and any other information with respect to this Lease reasonably requested by the Requesting Party. Failure to deliver the certificate within the twenty (20) days shall be conclusive upon the party failing to deliver the certificate for the benefit of the party requesting the certificate and any successor to the party requesting the certificate, that this Lease is in full force and effect, and has not been modified except as may be represented by the party requesting the certificate, and that rent and other charges have not been paid for any period after date of the notice requesting the certificate.
     18.16 Number and Gender. Whenever the context requires the singular number, it shall include the plural, the plural the singular, and the use of any gender shall include all genders.
     18.17 No Holding Over . Tenant shall have no right to holdover after the end of the Term. Should Tenant or any Leasehold Mortgagee succeeding to the interest of Tenant hold over in possession after the expiration date, such holding over shall not be deemed to extend the Lease or renew this Lease; and Tenant shall pay a pro-rated daily amount equal to one hundred twenty percent (120%) of the Annual Rent in effect immediately preceding the expiration date until Tenant vacates the Premises.
     18.18 Mechanics Liens. Tenant shall discharge, by payment, bonding or otherwise, any mechanics liens filed against the Premises or the Entire Premises in connection with Tenant’s work and/or any alterations or other work done by or on behalf of Tenant in the Premises within thirty (30) days after Tenant receives notice of the filing of such lien, and Landlord shall cooperate with Tenant at no expense to Landlord, in order to accomplish such discharge. Should Tenant fail to so discharge any such mechanics lien, Landlord shall have the right to remove such mechanics liens and charge all costs thereof, including without limitation, reasonable attorneys’ fees, to Tenant as additional rent plus interest at 18%.
     18.19 Relationship of Parties. Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the stockholders, officers or directors of Landlord or stockholders, officers, directors or trustees of Tenant should such parties be corporate entities.
     18.20 Time of the Essence. Time is of the essence with respect to Tenant’s payment of rent and other monetary obligations to Landlord under this Lease.
     18.21 Facsimile Copies. Tenant and Landlord (i) have each agreed to permit the use, from time to time and where appropriate, of telecopied signatures in order to expedite the transaction contemplated by this Lease, (ii) each intend to be bound by its respective telecopied signature, (iii) are each aware that the other will rely on the telecopied signature, and (iv) each acknowledge such reliance and waiver any defenses to the enforcement of the documents effecting the transaction contemplated by this Lease based on a telecopied signature.

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     18.22 Anti-Merger. The voluntary or otherwise surrender of this Lease by Tenant, or a mutual cancellation of this Lease shall not work a merger but shall at the option of Landlord either.
          A) Terminate any existing subleases or subtenancies; or
          B) Operate as an assignment to Landlord (and assumption by Landlord) of any subleases or subtenancies.
     Executed as of the date first written above.
             
TENANT:
           
 
           
    CENTURY THEATRES OF CALIFORNIA, INC.,
a California Corporation
   
 
           
 
  By:
Print Name:
Title:
  /s/ Joseph Syufy
 
Joseph Syufy
V. P.
   
 
           
LANDLORD:
           
 
           
    SYUFY ENTERPRISES
a California Limited Partnership
   
 
           
 
  By:
Print Name:
Title:
  /s/ Raymond W. Syufy
 
Raymond W. Syufy
G.P.
   

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EXHIBIT 10.36(b)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
FIRST AMENDMENT TO LEASE
     This First Amendment to Lease dated September 1, 2000 is executed by and between Syufy Enterprises, L.P. (“Landlord”) and Century Theatres, Inc. (“Tenant”).
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc. entered into a lease dated September 30, 1995 (the “Lease”) for a motion picture theater building and related parking (the “Premises”) located on Garfield Avenue in Citrus heights,California; and
     WHEREAS, Century Theatres, Inc. a Delaware corporation, has succeeded Century Theatres of California, Inc., as Tenant; and
     WHEREAS, Century Theatres, Inc. has assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
     WHEREAS, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
      A. Consumer Price Index
     The reference in the first grammatical paragraph of Section 4.01(B) of the Lease to the “San Francisco – Oakland – San Jose Average ” is hereby deleted and in its place is inserted the “All West Average,” and the following sentence shall be added to this first grammatical paragraph of Section 4.01(B):
     Notwithstanding the foregoing, in no event shall the Minimum Monthly Rent be increased by an amount that is more than ***           of the Minimum Monthly Rent payable before the adjustment date in question.
      B. Gross Sales
     The second paragraph of Section 4.02 is hereby deleted and in its place is inserted the following paragraph:
     Gross Sales shall mean all box office receipts, including receipts from tickets or gift certificates redeemed at the premises regardless of their point of sale, as well as receipts from sale of goods, merchandise, beverages, food, vending machines and video games. Gross Sales shall exclude credits and refunds made with respect to admissions or other sales; all federal, state, county and city
Century 16 Greenback Lane — Sacramento, CA

 


 

admission taxes, sales and use taxes, and other similar taxes now or hereafter imposed whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed therein, and actually paid over to the taxing authority by Tenant; returned, exchanged, waived or “Pass Admissions” including EBF charges on “Pass Admissions;” and receipts from tickets or gift certificates sold but not redeemed at the Premises. Commissions or surcharges paid to agencies or other third parties for selling tickets or processing credit card transactions, and any sums paid to third parties for the use or rental of vending machines, pay telephones or other amusement machines shall be deducted from Gross Sales.
      C. Insurance
     The reference in Section 6.03(D) to a Bests rating of “A-” is hereby deleted and in its place inserted a Bests rating of “A-/VII.”
      D. Alterations
     The last sentence of Section 7.01 (A) is hereby deleted and its place inserted the following:
     If the change, alteration or addition is structural or exterior in nature, Tenant shall provide Landlord with a copy of Tenant’s plans and specifications for the work and obtain Landlord’s written approval therefore, which approval shall not be unreasonably delayed or withheld.
      E. Indemnity and Hold Harmless
     The indemnity rights set forth in Sections 9,02 and 10.01 are hereby expanded to include an obligation by Tenant to defend, indemnify and hold harmless both Landlord and Landlord’s corporate affiliates, as well as their respective officers, directors, agents, and employees, in each instance where the right of indemnity would be accorded to Landlord.
      F. Assignment
     The reference in Section 11.01(C) to “$30,000,000.00” is hereby deleted and replaced with “$30,000,000.00, as adjusted each year by the CPI index identified in Section 4.01(B)”
      G. Surrender
     After the first sentence of Section 15.02(E), the following sentence is hereby inserted:
Century 16 Greenback Lane — Sacramento, CA

 


 

     Alternatively, Landlord may elect in its sole and absolute discretion to require Tenant to demolish the Tenant-occupied improvements located on the Premises and remove all surface debris thereon.
     This First Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease, or the executed amendments thereto, if any, shall remain in effect.
     
SYUFY ENTERPRISES, L.P.
“Landlord”
  CENTURY THEATRES, INC.
“Tenant”
 
   
/s/ Raymond W. Syufy
  /s/ Joseph Syufy
Raymond W. Syufy
  Joseph Syufy
Chief Executive Officer
  President
[STAMP]
Century 16 Greenback Lane — Sacramento, CA

 

 

EXHIBIT 10.36(c)
SECOND AMENDMENT TO LEASE
     This Second Amendment to Lease dated October 1, 2001 is executed by and between Syufy Enterprises, a California limited partnership, hereinafter called “Landlord,” and Century Theatres, Inc., a Delaware corporation, hereinafter called “Tenant.”
WITNESSETH:
     WHEREAS, Landlord and Century Theatres of California, Inc., entered into an Indenture of Lease on September 30, 1995, hereinafter referred to as the “Lease,” for land and a theatre building located in Citrus Heights, California, and
     WHEREAS, Landlord and Tenant entered into that certain First Amendment to Lease dated September 1, 2000, and
     WHEREAS, the parties hereto desire to amend said Lease as hereinafter provided,
     NOW, THEREFORE, the parties hereto mutually agree that the Lease shall be amended as follows:
     1. Tenant shall be allowed to demolish the existing Theatre Building and Improvements. Tenant shall be responsible for all costs of the demolition and removal of debris.
     2. Tenant shall be allowed to re-develop the Entire Premises in order to construct a new multi-screen theater complex and provide for surface parking in connection therewith. Tenant shall be responsible for all costs to re-develop the property for Tenant’s use.
     3. The term “Leased Premises” as defined in Section 1.02 — Definitions in Article I of the Lease shall be deleted in its entirety and replaced with the following definition:
     The term “Leased Premises” shall mean Tenant’s Building and the land adjacent thereto as described in Exhibit A and as shown on Exhibit B, and the rights, easements and privileges granted to Tenant in the Lease.
     4.  Section 2.01 of the Lease shall be deleted in its entirety and replaced with the following:
     Landlord leases to Tenant and Tenant leases from Landlord, the Entire Premises, upon the terms and conditions contained herein.
     5. Section 14.06 Partial Taking — Option to Terminate shall be amended by deleting the phrase “if more than thirty percent (30%) of the Building or”.

 


 

     6. Section 7.01 (C) of the Lease shall be deleted in its entirety.
     7. Section 9.01 of the Lease shall be deleted in its entirety.
     8. Section 9.04 (B) of the Lease shall be deleted in its entirety.
     9. Section 7.02 of the Lease shall be amended by deleting the parenthetical phrases “(exclusive of Landlord’s Buildings)” and by deleting the reference to the “Common Area.”
     10. This Amendment shall be effective on the date first set forth above.
     11. All other conditions and provisions of the Lease shall remain in effect.
     Executed as of the date first written above.
     
SYUFY ENTERPRISES, L.P.
  CENTURY THEATRES, INC.
 
   
/s/ Alan Steuer 
  /s/ Raymond W. Syufy 
By:     Alan Steuer
  By:     Raymond W. Syufy
Its:     CFO
  Its:     CEO
[STAMP]

 

 

EXHIBIT 10.36(d)
Third Amendment to Lease
      This Third Amendment to Lease (this “Amendment”) dated April 15, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“Landlord”), and Century Theatres, Inc., a California corporation (“Tenant”) .
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000, between Syufy Enterprises, L.P. and Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”) , and as further amended by that certain Second Amendment to Lease, dated October 1, 2001, between Syufy Enterprises and Century Theatres (DE) (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises”) located at 6233 Garfield Avenue, Sacramento, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres (DE) succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres, Inc. (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc, a California corporation, has assumed all obligations o Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now , Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Landlord’s Right to Develop
     1. After the first sentence of Section 2.01 (a) of the Lease, the following is hereby added:
Tenant expressly agrees that Landlord shall have the right, but shall have no obligation, to demolish, renovate, remodel, reconstruct or otherwise alter or develop in any manner the Entire Premises or any portion thereof for any and all uses beyond the Permitted Use (the “Development”) without Tenant’s consent; provided, however, that the Development shall not materially interfere with the Permitted Use or Tenant’s access to the Premises. In addition to developing some or all of the Entire Premises that
Century 16 Greenback Lane — Sacramento, CA

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are outside of the Building, Landlord’s Development rights set forth above shall include all roof-top and other exterior communication and advertising rights on or about the Entire Premises, including, without limitation, the exclusive right to install, locate, maintain, use, replace and repair satellite dishes and other roof-top communications equipment on the roof of the Building. In connection with the foregoing, Tenant agrees that Tenant shall have no right to lease or otherwise allow any third party to access or use the roof of the Building or any portion of the Premises for any use other than the Permitted Use.
     2. Tenant hereby waives all claims of any nature whatsoever Tenant may now have or may hereafter have against Landlord relating in any manner to, directly or indirectly, the Development. Without limiting the generality of the foregoing, Landlord shall not be liable for any damage to persons or property located in, on or about the Premises resulting from or in connection with the Development, and Tenant waives and shall defend, indemnify and hold harmless Landlord from any and all claims asserted by Tenant or Tenant’s officers, agents, employees, contractors, licensees, invitees or guests arising from damage resulting from or in connection with the Development (except to the extent such damage is caused by the willful act or gross negligence of Landlord; provided, however, that Landlord shall not be liable for any consequential damages, including, without limitation, any claim for loss of profit or business).
B. Surrender
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease and promptly following Tenant’s receipt of a cost estimate thereof from Landlord, Tenant shall pay to Landlord an amount equal to the cost of demolishing the improvements located on the Premises and removing all surface debris therefrom to Landlord’s reasonable satisfaction, as such cost estimate is determined by Landlord in Landlord’s sole and absolute discretion; provided, however, that Tenant may remove any or all of Tenant’s furniture, fixtures and equipment (the “FF&E” ) from the Premises, so long as such removal occurs within forty-five (45) days after the Termination Date and Tenant repairs all extraordinary damage caused by such removal. Except as set forth above, from and after the Termination Date, the parties shall have no further rights under the Lease nor further obligations with respect to the Premises, except for any rights or obligations which expressly survive the termination of the Lease in accordance with the provisions thereof or at law.
C. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
Century 16 Greenback Lane — Sacramento, CA

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     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
[Signatures on following page]
Century 16 Greenback Lane — Sacramento, CA

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      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
 
Raymond Syufy,
      /s/ Joseph Syufy
 
Joseph Syufy,
   
Chief Executive Officer
      Chief Executive Officer    
Century 16 Greenback Lane — Sacramento, CA

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EXHIBIT 10.36(e)
Fourth Amendment to Lease
      This Fourth Amendment to Lease (this “Amendment”) dated September 29, 2005 is executed by and between Syufy Enterprises, L.P., a California limited partnership (“ Landlord ”), and Century Theatres, Inc., a California corporation (“Tenant”) .
Witnesseth:
      Whereas, Landlord and Century Theatres of California, Inc., a California corporation, entered into a lease dated September 30, 1995, as amended by that certain First Amendment to Lease, dated September 1, 2000, between Syufy Enterprises, L.P. and Century Theatres, Inc., a Delaware corporation (“Century Theatres (DE)”) , and as further amended by that certain Second Amendment to Lease, dated October 1, 2001, between Syufy Enterprises and Century Theatres (DE), as further amended by that certain Third Amendment to Lease, dated April 15, 2005, between Landlord and Century Theatres, Inc., a California corporation (as amended, the “Lease” ), for a motion picture building and related parking (the “Premises” ) located at 6233 Garfield Avenue, Sacramento, California; capitalized terms used but not defined herein shall have the meanings set forth in the Lease; and
      Whereas, Century Theatres (DE) succeeded Century Theatres of California, Inc., as Tenant; and
      Whereas, Century Theatres, Inc. (DE) assumed all obligations of Century Theatres of California, Inc., as set forth in the Lease; and
      Whereas, Century Theatres, Inc., a California corporation, has succeeded Century Theatres (DE), as Tenant; and
      Whereas, Century Theatres, Inc, a California corporation, has assumed all obligations of Century Theatres (DE), as set forth in the Lease; and
      Whereas, the parties desire now to amend the Lease to revise and clarify certain obligations between the parties, as hereinafter provided;
      Now, Therefore, the parties hereto mutually agree that the Lease shall be amended as follows:
A. Surrender; No Demolition Obligation
     Notwithstanding anything to the contrary in the Lease, upon the expiration or earlier termination of the Lease, Tenant shall have no obligation to demolish or pay Landlord to demolish the improvements located on the Premises or to remove any surface debris therefrom.
B. Miscellaneous
     1. This Amendment constitutes the entire understanding of the parties with respect to the subject matter hereof and all prior agreements, representations, and understandings
Century 16 Greenback Lane — Sacramento, CA

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between the parties, whether oral or written, are deemed null, all of the foregoing having been merged into this Amendment.
     2. This Amendment to Lease is hereby executed and shall be effective as of the date first written above. All other conditions of the Lease shall remain in full force and effect.
     3. This Amendment shall bind and inure to the benefit of Landlord and Tenant and their respective legal representatives and successors and assigns.
     4. Each party hereby specifically represents and warrants that its execution of this Amendment has been duly authorized by all necessary corporate or other action, and that this Amendment when fully signed and delivered shall constitute a binding agreement of such party, enforceable in accordance with its terms.
     5. The parties acknowledge that each party and/or its counsel have reviewed and revised this Amendment and that no rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall be employed in the interpretation of this Amendment or any amendments or exhibits to this Amendment or any document executed and delivered by either party in connection with this Amendment.
     6. This Amendment may be executed in counterparts each of which shall be deemed an original and all of which taken together shall constitute one and the same agreement.
      In Witness Whereof, Landlord and Tenant have executed this Amendment to be effective as of the date first written above.
             
Syufy Enterprises, L.P.,
      Century Theatres, Inc.,    
a California limited partnership
      a California corporation    
“Landlord”
      “Tenant”    
 
           
/s/ Raymond Syufy
 
      /s/ Joseph Syufy
 
   
Raymond Syufy,
      Joseph Syufy,    
Chief Executive Officer
      Chief Executive Officer    
Century 16 Greenback Lane — Sacramento, CA

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EXHIBIT 10.36(f)
NOTE: THIS DOCUMENT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, 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.
Execution Version
FIFTH AMENDMENT TO LEASE
(Greenback, Sacramento)
      THIS FIFTH AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of August 7, 2006 to be effective as of the Effective Date (as defined hereinbelow) by and between SYUFY ENTERPRISES, L.P., a California limited partnership (“Landlord”), and CENTURY THEATRES, INC., a California corporation (“Tenant”).
R E C I T A L S:
     A. Landlord and Century Theatres of California Inc., a California corporation (“Original Tenant”), entered into a certain Lease dated as of September 30, 1995 (the “Original Lease”) for certain premises located in Sacramento, California.
     B. The Original Lease has been previously amended by (i) that certain First Amendment to Lease dated as of September 1, 2000 (the “First Amendment”), (ii) that certain Second Amendment to Lease dated as of October 1, 2001 (the “Second Amendment”), (iii) that certain Third Amendment to Lease dated as of April 15, 2005 (the “Third Amendment”), and (iv) that certain Fourth Amendment to Lease dated as of September 29, 2005 (the “Fourth Amendment”; the Original Lease as heretofore amended is referred to herein as the “Lease”).
     C. Tenant has succeeded to the interests and assumed the obligations of Original Tenant as the lessee under the Lease.
     D. Landlord has succeeded to the interests and assumed the obligation of Original Landlord as the lessor under the Lease.
     E. Landlord and Tenant now desire to further amend the Amended Lease, upon the terms and conditions set forth in this Amendment.
      NOW THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the Lease is hereby modified and amended, and Landlord and Tenant hereby agree, as follows:
     1.  Recitals Incorporated; Certain Defined Terms. The Recitals set forth above are incorporated into this Amendment and shall be deemed terms and provisions hereof, the same as if fully set forth in this Paragraph 1. Capitalized terms that are used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Lease.
     2.  Effectiveness. The parties are entering into this Amendment in connection with the contemplated acquisition of all the outstanding capital stock of Century Theatres, Inc. by Cinemark Holdings, Inc. and Cinemark USA, Inc. (the “Acquisition”) pursuant to a Stock Purchase Agreement dated as of the date hereof (the “Stock Purchase Agreement”). This Amendment shall become automatically effective upon, and only upon, the closing of the Acquisition (the “Effective Date”). In the event the Acquisition is not consummated and the Stock Purchase Agreement is terminated, this Agreement shall become void ab initio and of no force and effect.

 


 

     3.  Initial Term of Lease and Extension Options. Notwithstanding anything to the contrary in the Lease but subject to the provisions of the Lease applicable to the exercise an validity of such Renewal Terms, the Initial Term of the Lease is hereby extended to and shall expire on ***      and rather than***      Renewal Terms of ***      each (as provided in the Lease), Tenant shall have the option to extend the Initial Term for ***      consecutive Renewal Terms of ***      each, followed by ***      additional and final Renewal Term of ***
     4.  Landlord’s Recapture Right. If, at any time during the term of the Lease, Tenant fails to satisfy the Operating Condition (defined below), for reasons other than Excused Closure (defined below), and such failure continues for six (6) consecutive months or more, then upon notice from Landlord to Tenant at any time thereafter (provided that the Operating Condition remains unsatisfied), Landlord shall have the right to terminate the Lease and to recapture the Leased Premises, without payment to Tenant, effective upon the date set forth in Landlord’s termination notice (but not sooner than 30 days after the date of the termination notice).
     The term “Operating Condition” shall mean and require that the entire Leased Premises is being continuously operated and regularly open for business to the general public as a motion picture theater complex in accordance with the Lease, at least on such days and at such times that a majority of Century’s and Cinemark’s other motion picture theater complexes in the Sacramento, California metropolitan area typically are open and operating. The term “Excused Closure” shall mean (i) periods of construction, alterations, renovation, remodeling and repair of the Leased Premises undertaken in accordance with this Lease (including repairs and restoration following damage or destruction due to fire or other casualty) provided that Tenant (A) prosecutes such work to completion with reasonable diligence, (B) exercises its reasonable efforts to minimize the length of time of such closure, and (C) exercises its reasonable efforts to limit the number of motion picture screens at the Premises that are not operated due to such closure; (ii) periods when Tenant cannot practicably operate its business in the Premises as a consequence of force majeure; and (iii) additional periods, not to exceed four (4) days in any Lease Year, when Tenant in its sole discretion elects not to operate its business in the Leased Premises.
     5.  Self-Insurance of Property/Casualty Risks. Notwithstanding anything to the contrary set forth in the Lease, during any period in which Tenant maintains a Net Worth (as defined below) of at least One Hundred Million Dollars ($100,000,000.00), Tenant may self insure the so-called “physical property damage insurance” otherwise required to be maintained by Tenant pursuant to the Lease. As used herein, the “Net Worth” of Tenant at any given time shall mean an amount equal to the sum of (A) the product of (1) Tenant’s so-called EBITDA (i.e., earnings before interest, income taxes, depreciation and amortization), calculated in accordance with commercially reasonable past practice preceding the Effective Date by Tenant’s parent corporation, over the 12-month period immediately preceding the time of measurement, multiplied by (2) eight (8), plus (B) the amount of cash and cash equivalents held by Tenant on the most recent anniversary of Tenant’s annual insurance renewal date, minus (C) the amount of outstanding funded debt of Tenant on the determination date.
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     6.  Damage and Destruction — Repairs by Tenant. Notwithstanding anything to the contrary contained in the Lease, the following shall apply to repairs and restoration upon damage or destruction:
     (A) Tenant’s Obligation to Repair. If the Leased Premises are damaged or destroyed by any peril after the Commencement Date of this Lease, then Tenant shall repair the damage and restore the Leased Premises in accordance with this (A) and (B), except as provided in subsection (B) hereinbelow. Unless Tenant is not required to effect the repairs and restoration pursuant to subsection (B) below, Tenant shall promptly apply for and diligently seek to obtain all necessary governmental permits and approvals for the repair and restoration of the Leased Premises and, upon issuance of such governmental permits and approvals, promptly commence and diligently prosecute the completion of the repairs and restoration of the Leased Premises (to the extent permitted by applicable law) to substantially the same condition in which the Leased Premises were immediately prior to such damage or destruction (subject to any alterations which Tenant would be permitted to make to the Leased Premises pursuant to this Lease).
     (B) Damage in Excess of 20%. If the Leased Premises are damaged or destroyed by fire or other casualty which occurs in the last two years of the Initial Term or any Renewal Term and Tenant has no further options to extend the term of the Lease, and if the cost to repair such damage or to restore the Leased Premises as required in Section (A) exceeds twenty percent (20%) of the replacement cost of the Leased Premises (as determined by an independent architect selected by Tenant and approved by Landlord in Landlord’s reasonable discretion) and such damage makes it impracticable to operate the Leased Premises in the reasonable business judgment of Tenant, then (i) Tenant shall have the option, upon notice to Landlord not later than one hundred eighty (180) days following the occurrence of the applicable casualty, not to undertake the repairs and restoration of the Leased Premises, and (ii) if Tenant so elects not to undertake the repairs and restoration, then Tenant nevertheless shall raze Tenant’s Building and remove from the Leased Premises all building materials and debris and all underground installations that serve only the Leased Premises (including the footings and foundations of Tenant’s Building and the utility lines serving Tenant’s Building) and restore the surface of the Premises to a graded and landscaped surface.
     Notwithstanding anything to the contrary contained in the Lease, the proceeds of any property insurance maintained by Tenant (including proceeds of self-insurance, if applicable), net of actual-out-of-pocket costs to adjust and settle the loss, shall be distributed to and used by Tenant, in accordance with the Lease.
     7.  Permitted Assignments and Release. Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Subject to the next sentence, Tenant may sublet or assign this Lease only upon receipt of Landlord’s written consent which consent Landlord agrees shall

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not be unreasonably withheld, delayed or conditioned. Notwithstanding anything in this Lease to the contrary, it is agreed that at any time during the term of this Lease, Tenant may, without Landlord’s consent or approval (but only upon prior written notice to Landlord), assign this Lease or sublet the Leased Premises to: (i) any wholly-owned subsidiary of Tenant, (ii) any corporation, trust, partnership or individual that owns fifty percent (50%) or more of the issued and outstanding stock of Tenant, or (iii) any legal entity that is engaged in the motion picture exhibition business and operates motion picture theater complexes containing at least 100 theater screens (auditoria), excluding the Leased Premises and any other premises concurrently being acquired from Tenant. A change in control of Tenant shall not constitute an assignment of this Lease requiring Landlord’s consent or approval, provided, however, that if any assignee under clause (i) above ceases to be a wholly owned subsidiary of Tenant, then the same shall be deemed to constitute an assignment which is prohibited without Landlord’s approval under Article XI of the Lease.
     If Tenant shall assign this Lease pursuant to clause (ii) or clause (iii) above, and provided that (A) the assignee assumes in writing all obligations of Tenant under the Lease and delivers such executed written assumption to Landlord, and (B) Landlord shall have received from assignee’s chief financial officer or controller a certification that the Net Worth of the assignee (determined as provided above) equals or exceeds $100,000,000.00 calculated in accordance with Cinemark USA, Inc.’s methodology in calculating Net Worth as set forth in Section 5 hereof, then Tenant shall be released of any and all liability thereafter arising under the Lease. Except as expressly provided above, no assignment, subletting or other transfer of the Lease or the Leased Premises shall relieve or release Tenant from any liabilities or obligations arising under the Lease.
     8.  Leasehold Financing. Notwithstanding anything to the contrary contained in the Lease, Tenant shall have the right, without Landlord’s consent to encumber the leasehold estate created under the Lease and/or to grant a security interest in Tenant’s removable trade fixtures, furnishings and equipment located within the Leased Premises (but not to encumber Landlord’s fee interest in the Premises), to secure financing provided to Tenant by any bank, thrift institution, insurance company or other institutional lender. Tenant agrees to notify Landlord of any such encumbrance. With respect to any such leasehold financing (and provided that Tenant is not in default under the Lease beyond any applicable notice or cure period), upon thirty (30) days’ prior written request from Tenant, Landlord will execute and deliver to the secured lender a “Landlord’s Agreement” in the form attached hereto as Exhibit “A-l”.
     9.  Memorandum of Lease. On the Effective Date, Landlord and Tenant will enter into and record a short form memorandum of the Lease, in the form of Exhibit “A-2” attached hereto or otherwise in proper form for recording. Tenant shall be solely responsible for the cost of recording the memorandum, including (if applicable) any transfer taxes that may be due and payable in connection with the Lease.

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     10.  Gross Sales. Notwithstanding anything in the Lease to the contrary the definition of Gross Sales shall be as follows:
     “Gross Sales” shall mean the total amount of all revenues (whether in cash or credit) generated or derived from the conduct of any business at the Leased Premises, including (without limitation) all box office receipts of or at the Leased Premises (including receipts from tickets or gift certificates redeemed at the Leased Premises regardless of the point of sale), as well as any and all receipts from the sale of goods, services, merchandise, beverages, food, vending machines and video games at the Leased Premises; provided , however , that the following shall be excluded from “Gross Sales” (i) credits and refunds made with respect to admissions or other sales otherwise included in Gross Sales, (ii) all federal, state, county and city admission taxes, sales and use taxes, entertainment taxes, royalty taxes, gross receipt taxes and other similar taxes now or hereafter imposed and owing to the taxing authority by Tenant (whether such taxes are collected from customers separately from the selling price of admission tickets or absorbed by Tenant); (iii) receipts from the sale of gift certificates or tickets sold but not redeemed at the Leased Premises; (iv) with respect to any tickets or admissions ordered or paid for over the internet and redeemed at the Leased Premises, the portion (if any) of the sale price that exceeds Tenant’s actual box-office ticket price; (v) sales price for merchandise returned, (vi) amounts retained by credit card issuers, (vii) sales outside of the ordinary course of business, (viii) amount of credit card sales deemed uncollectible, (ix) advertising revenues including without limitation media, sponsorship, and promotional advertising of any kind, and (x) the receipts of or from so-called “four-wall deals” with a party that is not affiliated with Tenant, except that the portion thereof or other amounts paid to Tenant in connection with such “four-wall deals” shall be included in “Gross Sales” under this Lease. Commissions or surcharges paid to agencies or other third parties not affiliated with Tenant for selling tickets or processing credit card transactions, and any sums paid to third parties not affiliated with Tenant for the use or rental of vending machines, pay telephones, amusement machines and other similar devices shall be deducted from “Gross Sales” (if and to the extent previously included in “Gross Sales”).
     11.  Taxes. Notwithstanding any other provision of the Lease or this Amendment to the contrary, if during the ten (10) year period immediately following the Effective Date, any sale or change in ownership of the Premises (or against the Entire Premises, if the Premises are not separately assessed) is consummated by Landlord and, as a result, all or part of the Premises (or Entire Premises, if applicable) are reassessed (a “Reassessment”) for real property tax purposes by the appropriate governmental authority under the terms of Proposition 13 (as adopted by the voters of the State of California in the June 1978 election) or the terms of Article XIIIA of the Constitution of the State of California, then the terms of this Section shall apply. For purposes of this Section, the term “Tax Increase” shall mean that portion of the annual real estate taxes assessed against the Premises (or the Entire Premise, if applicable), as calculated immediately following the Reassessment, that is attributable solely to the Reassessment. Accordingly, a Tax Increase shall not include any portion of the real estate taxes, as calculated immediately following the Reassessment, that is:

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     (i) Attributable to the assessment of the value of the Premises (or Entire Premises, if applicable) prior to the Effective Date;
     (ii) Attributable to the annual inflationary increases in real estate taxes; or
     (iii) Attributable to the sale of Landlord’s ownership interest in Tenant on or about the Effective Date, or attributable to the execution of this Amendment or any extension of the Term of this Lease on the Effective Date or thereafter.
During the five (5) year period immediately following the Effective Date, Tenant shall not be obligated to pay any portion of any Tax Increase relating to a Reassessment.
Commencing on the fifth anniversary of the Effective Date, and continuing until the tenth anniversary of the Effective Date, Tenant shall be obligated to pay annually only the portion of a Tax Increase relating to a Reassessment that is equal to (or less than) an increase of four percent (4%) per annum, compounded annually, from the Effective Date, in the annual amount owed by Tenant for real estate taxes under the terms of the Lease, from the annual amount owed by Tenant for real estate taxes under the terms of the Lease in calendar 2006.
The terms and provisions of this Section shall not apply to any increase in real estate taxes which results from or is attributable to any occurrence, fact or circumstance other than a sale by Landlord of Landlord’s interest in the Premises or a transfer effected by Landlord which is treated as a sale by the local taxing authorities under Proposition 13 (excluding those matters identified in clause (iii) above). This Section shall not apply from and after the tenth (10th) anniversary of the Effective Date of this Amendment.
12. Alterations by Tenant.
     Notwithstanding anything in the Lease to the contrary, the following shall apply and control:
     Tenant shall have the right from time to time, at its sole cost and expense, to make non-structural interior alterations, improvements, or changes in the Leased Premises as Tenant shall deem necessary or beneficial consistent with Tenant’s exclusive use of the Leased Premises as a motion picture theatre complex and if Tenant undertakes such work, Tenant must pursue such work until completion. Tenant shall fully and completely indemnify Landlord against any mechanics’ or other liens in connection with the making of such alterations and changes, and shall pay all costs, expenses, and charges thereof. Alterations, changes and improvements shall be performed in a first-class manner and must comply with all laws, zoning regulations and ordinances, and any conditions on permits issued pursuant thereto. If it is necessary in Tenant’s reasonable judgment to close any of the motion picture screens during the period in which any of Tenant’s work permitted hereunder is performed, said closure(s) shall be effected only in accordance with the provisions governing an “Excused Closure”, as that term is defined in Section 4 of this Amendment.
13.  Rooftop Equipment and Access. Tenant shall have the exclusive right to install, operate, repair, replace and maintain satellite dishes and/or other communication transmission devices (collectively “Rooftop Equipment”) on the roof of the theatre necessary or appropriate

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to accept any transmission of signals to the theatre for all permitted uses, including without limitation, for movies, advertising, concerts, telecasts, corporate meetings or communications and the like; but Tenant shall be prohibited from entering into any leases or licenses with any third parties for retransmission from such Rooftop Equipment, and Tenant shall not retransmit such signals to a third party outside of the Leased Premises. Landlord shall not use, or permit any person or entity (other than Tenant), to use the roof or exterior walls of the theatre for any purpose whatsoever, and Landlord agrees not to enter into any leases or licenses with third parties for the use of the theater rooftop. Landlord shall be responsible for any damage to the rooftop caused by the Landlord or a third party that enters onto the theatre rooftop with Landlord’s permission, and Landlord shall indemnify and hold Tenant harmless from all loss, cost, damage or expense which Tenant incurs as a result of the acts or omissions of said third party or their agents or employer. Tenant hereby indemnifies and agrees to hold Landlord and Landlord’s successors and assigns harmless from all loss, cost, damage or expense which Landlord incurs as a result of the actions of Tenant, or its agents or employees in installing and utilizing Rooftop Equipment as permitted hereunder.
     14.  Alterations and Development by Landlord. Landlord agrees that with respect to the Entire Premises, the following restrictions shall apply to Landlord’s usage and improvement thereof:
     (a) Any alterations or new construction to the Entire Premises or contiguous property owned or controlled by Landlord or its affiliates as of the Effective Date (the “Contiguous Property”) may be made without Tenant’s consent only if such alterations or new construction do not materially and adversely affect Tenant’s operations (including, without limitation, parking, access, ingress and egress to the theatre building and visibility of the theatre building and/or on-building theatre signage). Any such alterations or new construction on the Entire Premises and any cross parking or cross access arrangements between the Entire Premises and the Contiguous Property will first be submitted to Tenant for approval, not to be unreasonably withheld or delayed, and Tenant shall be required to identify the manner in which Tenant’s operations are so affected. If Landlord and Tenant are unable to agree on whether such alteration or new construction materially and adversely affects Tenant’s operations, including without limitation, parking, access, ingress and egress and visibility, the parties agree to submit the issue to binding arbitration pursuant to the Lease.
     (b) Landlord shall not lease, sell or use any space on Non-leased Premises or the Contiguous Property for operating a motion picture theatre.
     (c) Subject to existing leases, licenses and operating agreements, Landlord shall not lease, license, enter into an operating agreement for, sell or use any space on Non- leased Premises for operating the following: a bowling alley; a bar or lounge (other than a bar or lounge that is connected with a restaurant, deriving 50% of its revenues from the sale of food); a liquor store (other than first-class or upper-end wine store such as “BevMo”); a bulk candy store, (other than upper-end candy stores such as Godiva, Sees, Rocky Mountain Chocolates and similar concepts); a popcorn store; a massage parlor or adult (i.e., pornographic) book store.
     (d) Landlord shall not place any carts, kiosks or other temporary structures selling food and/or beverages within common areas of the Entire Premises unless such carts, kiosks or

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other structures are more than 500 feet from the theatre. Such carts and kiosks may not sell any food or beverages sold in the theatre. Landlord shall not place any vending machines selling food and/or beverages on the common areas of the Entire Premises unless such vending machines are more than 500 feet from the theatre.
     (e) Any new buildings shall be limited to retail, restaurant, residential and/or office uses.
     15.  Permitted Use and Operations. From and after the Effective Date, Tenant shall be permitted to use and operate the Leased Premises as and only as: a first-class motion picture theatre complex (whether operated as a so-called “first-run” theatre, a “discount” theatre, and/or an “art house” theatre). In no event shall Tenant be permitted to operate the Leased Premises as a so-called “adult” theater complex.
     16.  No Obligation To Continuously Operate. Notwithstanding anything to the contrary in the Lease or otherwise, Landlord hereby acknowledges that Tenant shall not be required to continuously operate and open for business in or from the Premises and any election by Tenant to cease operations at the Premises shall not constitute a default or breach of the terms and conditions of the Lease.
     17.  Removal of Equipment, Surrender and Demolition. Upon the expiration of the Term or earlier termination of the Lease, and provided Tenant is not in default under the Lease beyond applicable notice and cure periods, and said earlier termination is not due to Tenant’s default under the Lease, then for a period extending forty-five (45) days beyond the date of said expiration or termination, Tenant shall be permitted to remove any and all furniture, fixtures and equipment owned and installed by Tenant in, on or to the Leased Premises. Such removal shall be: (a) at Tenant’s sole cost and expense; (b) conducted in such manner that no liens or claims shall arise or exist in connection therewith; (c) conducted in a manner to avoid unreasonable interference with the activities of Landlord and subsequent tenants or occupants upon the Leased Premises and Tenant shall repair all damages caused by such removal.
     Upon surrender of the Leased Premises by Tenant and removal of its equipment pursuant to the terms of the Lease and this Amendment, Landlord shall be responsible for the cost of any demolition of the Leased Premises and site grading and restoration as a result. Such demolition shall be undertaken in Landlord’s sole discretion and at such times, manner and upon such events as Landlord solely shall determine.
     18.  California Remedies . Landlord’s remedies upon a default under the Lease shall include, without limitation, the following:
Even though Tenant has breached the Lease and/or abandoned the Premises, this Lease shall continue in effect for so long as Landlord does not terminate Tenant’s right to possession, and Landlord may enforce all of its rights and remedies under this Lease, including (but without limitation) the right to recover Rent as it becomes due. Landlord has the remedy described in Section 1951.4 of the Civil Code of the State of California or any successor code section (Landlord may continue the Lease in effect after Tenant’s breach and abandonment and recover rent as it becomes due, if Tenant has the right to

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sublet or assign, subject only to reasonable limitations). Acts of maintenance, preservation or efforts to lease the Premises or the appointment of receiver upon application of Landlord to protect Landlord’s interest under this Lease shall not constitute an election to terminate Tenant’s right to possession.
     19.  Termination of Lease and Lessee’s Right to Possession . Section 15.02(C) of the Lease shall be deemed deleted in its entirety and replaced with the following:
     “If an event of default occurs, Landlord shall have the right, with or without notice or demand, immediately (after expiration of the applicable grace periods) to terminate this Lease, and at any time thereafter recover possession of the Premises or any part thereof and expel and remove therefrom Tenant and any other person occupying the same, by any lawful means, and again repossess and enjoy the Premises without prejudice to any of the remedies that Landlord may have under this Lease, or at law or equity by reason of Tenant’s default or of such termination. Should Landlord terminate this Lease pursuant to foregoing, Landlord shall have all the rights and remedies of a landlord provided by Section 1951.2 of the Civil Code of the State of California, or successor code section. Upon such termination, in addition to any other rights and remedies to which Landlord may be entitled at law or in equity, Landlord shall be entitled to recover from Tenant:
     (1)the worth at the time of award of the unpaid Rent which had been earned at the time of termination;
     (2)the worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such Rent loss that the Tenant proves could have been reasonably avoided;
     (3)the worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that the Tenant proves could be reasonably avoided;
     (4)any other amount, and court costs, necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom; and
     (5)for any other sums due.”
     20.  Notices. The notices provisions of the Lease, as the case may be, shall be deemed deleted in their entirety and replaced with the following:
     (a) Except as otherwise expressly and specifically in this Lease provided, a bill, demand, statement, consent, notice or other communication (“notice”) which either party may desire or be required to give to the other party shall be deemed sufficiently given or rendered if in writing, delivered personally to the party to be charged therewith or sent by certified mail (return receipt requested) or private express mail courier service (postage or delivery or courier fees fully prepaid) addressed to such party at the addresses set forth in subparagraph (c) below

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(including the addresses for copies of notices) and/or at such other address(es) as such party shall designate to the other party by notice given as herein provided. If Landlord is notified of the identity and address of Tenant’s Leasehold Mortgagee, Landlord shall give such party any notice served upon Tenant hereunder to the last known address of such Leasehold Mortgagee as provided by Tenant to Landlord by certified mail or private express courier service. If Tenant is notified of the identity and address of Landlord’s mortgagee, Tenant shall give such mortgagee any notice served upon Landlord hereunder to the last known address of such mortgagee as provided by Landlord to Tenant, by certified mail or private express courier service.
     (b) Any notice given in accordance with the foregoing provisions of this Section shall be deemed effective upon the earlier of (i) if the notice is personally delivered, the date actually received by intended recipient, (ii) if the notice is sent by certified mail, five (5) days after the same is mailed, or (iii) if the notice is sent by private overnight courier service (e.g., Federal Express, DHL or similar courier), one (1) day after the same is delivered to or picked up by such courier. Rejection or refusal to accept a notice or the inability to deliver same because of a changed address of which no notice was given shall be deemed to be a receipt of the notice sent. Notwithstanding any provision to the contrary contained in this Lease, no provision in this Lease shall preclude service of notices in accordance with Section 1162 of the California Code of Civil Procedure or any similar and/or successor code sections.
     (c) Addresses for Notices to Landlord and Tenant.
          Notices are to be delivered, mailed or couriered to the following address(es):
         
 
  To Landlord:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention: President
 
       
 
  with a copy to:   Syufy Enterprises, L.P.
150 Pelican Way
San Rafael, California 94901
Attention: General Counsel
 
       
 
       
 
  and a copy to:   DLA Piper
203 North LaSalle
Suite 1900
Chicago, IL 60601
Attention: David Sickle, Esq.
 
       
 
  To Tenant:   Century Theatres, Inc.
c/o Cinemark, Inc.
3900 Dallas Parkway
Suite 500
Plano, TX 75093
Attention: Legal Department

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          Tenant and Landlord may change their respective addresses for purposes of this section by giving written notice of such change to the other.
     21.  Miscellaneous Amendments. Notwithstanding anything contained herein to the contrary, whenever any of the terms “Leased Premises”, “Demised Premises” or “Premises” (and whether or not capitalized) is used herein, it shall be understood to mean the “premises leased hereby”; and whenever the term “Entire Premises” is used herein (and whether or not capitalized), it shall be understood to mean all of the contiguous land and buildings owned by Landlord at this location, which include the premises leased hereby. The term “Non-leased Premises” shall mean the Entire Premises less the Leased Premises.
     22.  Prior Amendments. All of the provisions of the First Amendment are hereby deleted in their entirety and of no further force and effect except for (i) the first grammatical paragraph of Paragraph A concerning the definition of Consumer Price Index and (ii) Paragraph E concerning the Indemnity and Hold Harmless. The Second Amendment and the Third Amendment and the Fourth Amendment are hereby deemed to be void ab initio — it being the intent of the parties hereto that this Amendment shall supersede the Second, Third and Fourth Amendments in their entirety.
     23.  Effect of Amendment. The Amendment modifies and amends the Lease, and the terms and provisions hereof shall supersede and govern over any contrary or inconsistent terms and provisions set forth in the Lease. The Lease, as previously amended and as hereby further amended and modified, remains in full force and effect and is hereby ratified and confirmed. All future references in the Lease to the “Lease” shall mean and refer to the Lease, as amended and modified by this Amendment.
[Signatures Appear on Next Page]

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      IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date herein above provided.
Landlord:
SYUFY ENTERPRISES, L.P., a California limited partnership
             
 
  By:
Name:
Title:
  /s/ Joseph Syufy
 

 

 
   
Tenant:
CENTURY THEATRES, INC., a California corporation
             
 
  By:
Name:
Title:
  /s/ Raymond W. Syufy