8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K/A

(Amendment No. 1)

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 14, 2010

Carmike Cinemas, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware	000-14993	58-1469127
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

1301 First Avenue, Columbus, Georgia	31901
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (706) 576-3400

Not applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01. Completion of Acquisition or Disposition of Assets.

On October 20, 2010, Carmike Cinemas, Inc. filed a Current Report on Form 8-K (the “Original 8-K”) reporting the completion of its acquisition of a 20% profits interest in SV Holdco, LLC (a holding company of Technicolor Cinema Advertising, LLC) (the “Transaction”) and stating that the financial statements and pro forma financial information required under Item 9.01 of Form 8-K would be filed within the time period specified in the instructions to Item 9.01 of Form 8-K. This amended Current Report on Form 8-K contains the required financial statements and pro forma financial information referenced in the Original 8-K.

Item 9.01. Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired

The Technicolor Cinema Advertising, LLC and Subsidiaries audited financial statements for the year ended December 31, 2009 are attached as Exhibit 99.3 to this amended Current Report on Form 8-K and incorporated by reference herein.

The Technicolor Cinema Advertising, LLC and Subsidiaries unaudited financial statements as of June 30, 2010 and December 31, 2009 and for each of the six months in the periods ended June 30, 2010 and June 30, 2009 are attached as Exhibit 99.4 to this amended Current Report on Form 8-K and incorporated by reference herein.

The consent of KPMG LLP, Technicolor Cinema Advertising, LLC’s independent public accounting firm, is attached as Exhibit 23.1 to this amended Current Report on Form 8-K.

(b) Pro Forma Financial Information

The following unaudited pro forma consolidated financial information related to the Transaction is attached as Exhibit 99.2 to this amended Current Report on Form 8-K and incorporated by reference herein.

(i) Unaudited Pro Forma Consolidated Balance Sheet of Carmike Cinemas, Inc. as of June 30, 2010; and

(ii) Unaudited Pro Forma Condensed Statements of Operations of Carmike Cinemas, Inc. for the year ended December 31, 2009 and the six month period ended June 30, 2010.

(d) Exhibits.

23.1	Consent of KPMG LLP.
99.1	Press release dated October 14, 2010 (incorporated by reference to Exhibit 99.1 to the Original 8-K).
99.2	Unaudited Pro Forma Financial Information.
99.3	Technicolor Cinema Advertising, LLC and Subsidiaries audited consolidated financial statements for the year ended December 31, 2009.
99.4	Technicolor Cinema Advertising, LLC and Subsidiaries unaudited condensed consolidated financial statements as of June 30, 2010 and December 31, 2009 and for each of the six months in the periods ended June 30, 2010 and June 30, 2009.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CARMIKE CINEMAS, INC.
Date: December 21, 2010	By:	/s/ Richard B. Hare
		Richard B. Hare
		Senior Vice President—Finance, Treasurer and Chief Financial Officer

EXHIBIT INDEX

Exhibit Number	Description
23.1	Consent of KPMG LLP.
99.1	Press release dated October 14, 2010 (incorporated by reference to Exhibit 99.1 to the Original 8-K).
99.2	Unaudited Pro Forma Consolidated Financial Information.
99.3	Technicolor Cinema Advertising, LLC and Subsidiaries audited consolidated financial statements for the year ended December 31, 2009.
99.4	Technicolor Cinema Advertising, LLC and Subsidiaries unaudited condensed consolidated financial statements as of June 30, 2010 and December 31, 2009 and for each of the six months in the periods ended June 30, 2010 and June 30, 2009.

EX-23.1

Exhibit 23.1

Independent Auditors’ Consent

The Board of Directors

SV Holdco, LLC:

We consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-121940, 333-102765, 333-102764, and 333-85194) and on Form S-3 (No. 333-167383) of Carmike Cinemas, Inc. and subsidiaries of our report dated August 12, 2010, with respect to the consolidated balance sheet of Technicolor Cinema Advertising, LLC and subsidiaries as of December 31, 2009, and the related consolidated statements of operations, members’ equity, and cash flows for the year then ended, which report appears in the Form 8-K of Carmike Cinemas, Inc. dated December 21, 2010.

New York, New York

December 21, 2010

EX-99.2

Exhibit 99.2

CARMIKE CINEMAS, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION

On October 14, 2010, Carmike Cinemas, Inc. (“Carmike” or the “Company”) finalized the modification of its long-term exhibition agreement (the “Modified Exhibition Agreement”) with Technicolor Cinema Advertising, LLC (“Screenvision”), the Company’s exclusive provider of on-screen advertising services, which extended the Company’s exhibition agreement with Screenvision, which was set to expire on July 1, 2012, for an additional 30 year term through July 1, 2042 (“Expiration Date”).

In connection with the Modified Exhibition Agreement, the Company will receive a cash payment of $30 million from Screenvision in January 2011 and, on October 14, 2010, the Company received membership units representing approximately 20% of the issued and outstanding membership units of the newly formed SV Holdco, LLC (“SV Holdco”), a private limited liability company, which acquired 100% of the outstanding common stock of Screenvision on that date and has no activities other than its ownership of Screenvision. The units are structured as a profits interest and entitle the Company to receive, upon liquidation of SV Holdco, a pro rata share of the liquidation proceeds, provided that applicable distribution thresholds are satisfied. The Company will also receive additional units (“bonus units”), all of which will be subject to forfeiture, or may forfeit some of its initial units, based upon changes in the Company’s future theatre and screen count. Bonus units and those initial units also subject to forfeiture will each become non-forfeitable on the Expiration Date, or upon the earlier occurrence of certain events, including (1) a change of control or liquidation of SV Holdco or (2) the consummation of an initial public offering of securities of SV Holdco. As a result, bonus units and forfeitable units will not be reflected in the Company’s consolidated financial statements until such units become non-forfeitable. Both the cash and non-forfeitable unit consideration will be deferred and recognized as concessions and other revenue on a straight line basis beginning October 14, 2010.

The Company will apply the equity method of accounting for its non-forfeitable units and will record the related percentage of the earnings or losses of SV Holdco in its Consolidated Statement of Operations beginning on October 14, 2010.

The following unaudited pro forma condensed financial statements reflect the historical results of the Company as adjusted on a pro forma basis to give effect to the Screenvision Transaction. The unaudited pro forma condensed balance sheet is based on the unaudited June 30, 2010 condensed consolidated balance sheet of Carmike and includes pro forma adjustments to give effect to the receipt of $30 million in cash and an approximately 20% ownership interest in SV Holdco under the Screenvision transaction as if it occurred on June 30, 2010. The unaudited pro forma condensed statements of operations for the year ended December 31, 2009 and the six months ended June 30, 2010 are based on the audited statements of operations of Carmike and Screenvision for the year ended December 31, 2009 and the unaudited statements of operations of Carmike and Screenvision for the six months ended June 30, 2010, respectively, as if the Screenvision transaction had occurred on January 1, 2009.

The unaudited pro forma condensed financial statements are provided for illustrative purposes only. The information includes certain assumptions and estimates and may not necessarily be indicative of the results that actually would have occurred had the Screenvision transaction occurred as of the date or at the beginning of the periods presented or which may be attained in the future. These unaudited pro forma condensed financial statements should be read in conjunction with the accompanying notes; the Company’s Annual Report on Form 10-K for the year ended December 31, 2009; the Company’s Quarterly Report on Form 10-Q for the six months ended June 30, 2010; the Current Reports on Form 8-K filed by Carmike on October 1, 2010 and October 20, 2010 in connection with the Screenvision transaction; and the audited consolidated financial statements of Screenvision as of and for the year ended December 31, 2009 and the unaudited condensed consolidated financial statements of Screenvision as of and for the six months ended June 30, 2010, both of which are included in this Current Report on Form 8-K.

CARMIKE CINEMAS, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED BALANCE SHEET

AS OF JUNE 30, 2010

(in thousands except share and per share data)

	Carmike Historical			Pro Forma Adjustments (Footnote 2)			Carmike Pro Forma
ASSETS
Current assets:
Cash and cash equivalents	$	18,373		$	30,000	a	$	48,373
Restricted cash		96			—			96
Accounts receivable		4,955			—			4,955
Inventories		2,603			—			2,603
Prepaid expenses		6,827			—			6,827
Total current assets		32,854			30,000			62,854
Property and equipment:
Land		54,233			—			54,233
Buildings and building improvements		272,660			—			272,660
Leasehold improvements		120,229			—			120,229
Assets under capital leases		50,924			—			50,924
Equipment		214,631			—			214,631
Construction in progress		1,608			—			1,608
Total property and equipment		714,285			—			714,285
Accumulated depreciation and amortization		(338,111	)		—			(338,111	)
Property and equipment, net of accumulated depreciation		376,174			—			376,174
Assets held for sale		2,249			—			2,249
Intangible assets, net of accumulated amortization		1,175			—			1,175
Other assets		23,176			7,875	b		31,051
Total assets	$	435,629		$	37,875		$	473,504
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	29,209		$	—		$	29,209
Accrued expenses		30,585			—			30,585
Deferred revenue		—			1,184	a, b		1,184
Current maturities of long-term debt, capital leases and long-term financing obligations		4,292			—			4,292
Total current liabilities		64,087			1,184			65,270
Long-term liabilities:
Deferred revenue		—			36,691	a, b		36,691
Long-term debt, less current maturities		238,988			—			238,988
Capital leases and long-term financing obligations, less current maturities		116,341			—			116,341
Other		14,363			2,858	f		17,221
Total long-term liabilities		369,692			39,549			409,242
Commitments and contingencies (Note 7)
Stockholders’ equity:
Preferred Stock, $1.00 par value per share: 1,000,000 shares authorized, no shares issued		—			—			—
Common Stock, $0.03 par value per share: 20,000,000 shares authorized, 13,328,372 shares issued and 12,879,173 shares outstanding at June 30, 2010, and 13,266,372 shares issued and 12,862,963 shares outstanding at December 31, 2009		400			—			400
Treasury stock, 449,199 and 403,409 shares at June 30, 2010 and December 31, 2009, respectively		(11,657	)		—			(11,657	)
Paid-in capital		288,120			—			288,120
Accumulated deficit		(275,012	)		(2,858	) f		(277,870	)
Total stockholders’ equity		1,851			(2,858	)		(1,007	)
Total liabilities and stockholders’ equity	$	435,629		$	37,875		$	473,504

The accompanying notes are an integral part of these financial statements.

CARMIKE CINEMAS, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 2009

(in thousands, except per share data)

	Carmike Historical			Pro Forma Adjustments (Footnote 2)			Carmike Pro Forma
Revenues:
Admissions	$	345,742		$	—		$	345,742
Concessions and other (includes $8.6 million from related parties before pro forma adjustments)		168,973			(474	) d, g, h		168,499
Total operating revenues		514,715			(474	)		514,241
Operating costs and expenses:
Film exhibition costs		191,379			—			191,379
Concession costs		17,415			—			17,415
Other theatre operating costs		210,487			—			210,487
General and administrative expenses		16,139			—			16,139
Separation agreement charges		5,462			—			5,462
Depreciation and amortization		34,324			—			34,324
(Gain) loss on sale of property and equipment		(425	)		—			(425	)
Impairment of long-lived assets		17,554			—			17,554
Total operating costs and expenses		492,335			—			492,335
Operating income		22,380			(474	)		21,906
Interest expense		33,067			—			33,067
Income (loss) from continuing operations before income tax		(10,687	)		(474	)		(11,161	)
Income tax expense		4,359			3,105	e, f		7,464
Earnings from equity investment		—			2,782	c, d		2,782
Income (loss) from continuing operations	$	(15,046	)	$	(797	)	$	(15,843	)
Weighted average shares outstanding:
Basic		12,678			—			12,678
Diluted		12,678			—			12,678
Loss from continuing operations per common share (Basic and Diluted):
Loss from continuing operations per common share	$	(1.19	)				$	(1.25	)

The accompanying notes are an integral part of these financial statements.

CARMIKE CINEMAS, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 2010

(in thousands, except per share data)

	Carmike Historical			Pro Forma Adjustments (Footnote 2)			Carmike Pro Forma
Revenues:
Admissions	$	167,002		$	—		$	167,002
Concessions and other (includes $3.9 million from related parties before pro forma adjustments)		84,588			(165	) d, g, h		84,423
Total operating revenues		251,590			(165	)		251,425
Operating costs and expenses:
Film exhibition costs		94,449			—			94,449
Concession costs		9,103			—			9,103
Other theatre operating costs		107,185			—			107,185
General and administrative expenses		9,304			—			9,304
Depreciation and amortization		16,096			—			16,096
(Gain) loss on sale of property and equipment		9			—			9
Impairment of long-lived assets		3,724			—			3,724
Total operating costs and expenses		239,870			—			239,870
Operating income		11,720			(165	)		11,555
Interest expense		18,665			—			18,665
Loss on extinguishment of debt		2,568			—			2,568
Income (loss) from continuing operations before income tax		(9,513	)		(165	)		(9,678	)
Income tax expense		560			9,902	e, f		10,462
Earnings from equity investment		—			625	c, d		625
Income (loss) from continuing operations	$	(10,073	)	$	(9,442	)	$	19,515
Weighted average shares outstanding:
Basic		12,720			—			12,720
Diluted		12,720			—			12,720
Loss from continuing operations per common share (Basic and Diluted):
Loss from continuing operations per common share	$	(0.79	)				$	(1.53	)

The accompanying notes are an integral part of these financial statements.

CARMIKE CINEMAS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS

1. Basis of Presentation

The historical financial information is derived from the historical consolidated financial statements of Carmike and the historical consolidated financial statements of Screenvision. The unaudited pro forma condensed balance sheet as of June 30, 2010 has been prepared as if Carmike’s receipt of $30 million and approximately 20% ownership interest in SV Holdco (the “Transaction”), the parent company of Screenvision, occurred on June 30, 2010. The unaudited pro forma condensed statements of operations for the year ended December 31, 2009 and the six months ended June 30, 2010 have been prepared as if the Transaction occurred on January 1, 2009. Because SV Holdco was formed on the date of the Transaction and has no activities other than its ownership of 100% of the outstanding common stock of Screenvision, the unaudited pro forma financial statements reflect adjustments based upon the historical consolidated financial statements of Screenvision.

2. Pro Forma Adjustments

The following adjustments were made in preparation of the unaudited pro forma condensed financial statements.

(a) Adjustment to record the $30 million cash bonus paid to the Company from Screenvision as partial consideration for the Company extending its long-term exhibition agreement with Screenvision for an additional thirty year term. The Company will defer the revenue related to the bonus and amortize it on a straight line basis through the Expiration Date. The year ended 2009 and six months ended June 30, 2010 Statement of Operations, have been prepared as if Carmike’s receipt of $30 million occurred on January 1, 2009. The Company has not imputed any interest income related to the receipt of this cash bonus in the December 31, 2009 or June 30, 2010 Statements of Operations.

(b) Adjustment to reflect the estimated fair value of the Company’s non-forfeitable ownership interest in SV Holdco, the parent Company of Screenvision, based upon a preliminary valuation. The Company’s profits interest in Screenvision equity is 20% less any forfeitable units. The fair value of these non-forfeitable units was determined using the Black-Scholes option pricing model. The Black-Scholes model considers the market price of the equity of SV Holdco, the expected holding term of the Company’s ownership interest, the risk-free rate over the expected term, and the expected volatility of the equity of SV Holdco, as determined by reference to peer companies. The Company has deferred revenue in an amount equal to the fair value of the ownership interest and will amortize the revenue through the Expiration Date.

The following table sets forth information about the estimated fair value of the Company’s non-forfeitable ownership interest in SV Holdco and the related assumptions as of the Transaction date:

Fair value of non-forfeitable ownership interest	$	8.00
Expected life (years)		5.0
Risk-free interest rate		1.2	%
Expected dividend yield		—	%
Expected volatility		70.0	%

(c) Adjustment to reflect the application of the equity method of accounting for the Company’s ownership interest in SV Holdco. Specifically, the adjustment represents the Company’s non-forfeitable ownership interest in SV Holdco net income for the year ended 2009 of $1.17 million and net loss for the six months ended June 30, 2010 of $105 thousand.

(d) Adjustment to reflect the elimination of advertising revenue recorded by Carmike and advertising expense recorded by Screenvision associated with the theatre exhibition agreement for the year ended 2009 and six months ended June 30, 2010 of $1.6 million and $730 thousand, respectively. Carmike’s historical advertising revenue includes monthly on-going attendance-based payments from Screenvision.

(e) Adjustment to reflect the income tax expense associated with the $30 million bonus due to the Company from Screenvision for the year ended 2009 and the six months ended June 30, 2010 of approximately $331 thousand and $10.4 million, respectively. Applicable U.S. tax laws which allow for a one-year deferral of taxable income associated with the unamortized portion of certain deferred revenue items (such as this cash bonus); such tax will be incurred and is included in tax expense for the six months ended June 30, 2010. The Company continues to believe the realization of its deferred tax assets are not likely. As such, current income tax expense associated with the Transaction is generally not offset by a deferred tax benefit. Tax expense for the six months ended June 30, 2010 has been offset by a reduction in the valuation allowance of $455 thousand as a result of deferred tax assets that more likely than not will be recognized.

(f) Adjustment to reflect the income tax liability, and related expense, on the fair value of the Company’s non-forfeitable ownership interest in SV Holdco. The Company will recognize a tax basis for these units that is lower than the carrying value for financial statement purposes. However, as this tax position may not be sustained upon examination, the Company has recorded a related liability for this uncertain tax position. As a result, the Company has recorded tax expense for the year ended December 31, 2009 of $2.8 million and a deferred tax benefit for the six months ended June 30, 2010 of $43 thousand.

(g) Adjustment to reflect the amortization of deferred revenue for the $30 million bonus for the year ended 2009 and the six months ended June 30, 2010 of $896 thousand and $448 thousand, respectively.

(h) Adjustment to reflect the amortization of deferred revenue for the non-forfeitable ownership interest in SV Holdco for the year ended 2009 and the six months ended June 30, 2010 of $235 thousand and $118 thousand, respectively.

EX-99.3

Exhibit 99.3

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Consolidated Financial Statements

December 31, 2009

(With Independent Auditors’ Report Thereon)

Independent Auditors’ Report

The Board of Directors

Technicolor Cinema Advertising, LLC:

We have audited the accompanying consolidated balance sheet of Technicolor Cinema Advertising, LLC and subsidiaries (the Company) as of December 31, 2009, and the related consolidated statements of operations, members’ equity, and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal controls over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Company’s internal controls over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Technicolor Cinema Advertising, LLC and subsidiaries as of December 31, 2009, and the results of their operations and their cash flows for the year then ended in conformity with U.S. generally accepted accounting principles.

As discussed in note 2 to the consolidated financial statements, the Company adopted the provisions of Accounting Standards Codification (ASC) 740 Income Taxes (formerly Financial Accounting Standards Board (FASB) Interpretation No. 48, Accounting for Uncertainties in Income Taxes, an interpretation of Statement of Financial Accounting Standards (SFAS) No. 109, Accounting for Income Taxes), as of January 1, 2009.

August 12, 2010

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Consolidated Balance Sheet

December 31, 2009

(Amounts in thousands)

Assets
Current assets:
Cash and cash equivalents	$	26,647
Accounts receivable, less allowance for doubtful accounts of $2,871 as of December 31, 2009		60,539
Prepaid expense and other current assets		14,861
Deferred taxes (note 6)		2,359
Total current assets		104,406
Property and equipment, net (note 3)		26,609
Goodwill (note 4)		64,479
Intangibles, net (note 4)		1,458
Other assets		9,870
Total assets	$	206,822
Liabilities and Members’ Equity
Current liabilities:
Accounts payable	$	2,556
Accrued liabilities		37,647
Due to members (note 7)		11,342
Deferred revenue		8,672
Total current liabilities		60,217
Deferred taxes (note 6)		11,613
Other noncurrent liabilities		4,059
Total liabilities		75,889
Commitments and contingencies (note 8)
Members’ equity (note 5)		130,933
Total liabilities and members’ equity	$	206,822

See accompanying notes to consolidated financial statements.

2

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Consolidated Statement of Operations

Year ended December 31, 2009

(Amounts in thousands)

Revenue	$	179,506
Operating expenses:
Cost of revenue		105,990
Selling and marketing costs		28,167
Administrative costs		17,151
Depreciation and amortization		12,832
Operating income		15,366
Interest income, net (note 8)		197
Other income (expense), net		560
Income before provision for income taxes		16,123
Provision for income taxes (note 7)		(8,276	)
Net income	$	7,847

See accompanying notes to consolidated financial statements.

3

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Consolidated Statement of Members’ Equity

Year ended December 31, 2009

(Amounts in thousands except shares)

	Series A shares		Amount			Series B shares		Amount			Total members’ equity
Balance – January 1, 2009		61,000	$	73,538			61,000	$	73,538			147,076
Net income		—		3,924			—		3,923			7,847
Cumulative effect of adoption of ASC 740 (note 6)		—		(995	)		—		(995	)		(1,990	)
Cash dividend		—		(11,000	)		—		(11,000	)		(22,000	)
Balance – December 31, 2009		61,000	$	65,467			61,000	$	65,466			130,933

See accompanying notes to consolidated financial statements.

4

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Consolidated Statement of Cash Flows

Year ended December 31, 2009

(Amounts in thousands)

Cash flows from operating activities:
Net income	$	7,847
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		12,832
Tax benefit applied to reduce goodwill		81
Gains on disposals of property and equipment		(124	)
Provision for bad debt, net of write-offs		73
Deferred income tax		1,222
Asset retirement obligation accretion cost		132
Changes in operating assets and liabilities:
Accounts receivable		461
Prepaid expense and other current assets		2,269
Accounts payable and accrued expenses		8,104
Due to Members		(6,566	)
Deferred revenue		3,766
Other noncurrent assets and liabilities		(7,879	)
Net cash provided by operating activities		22,218
Cash flows from investing activities:
Capital expenditures		(8,267	)
Proceeds from sales of property and equipment		295
Net cash used in investing activities		(7,972	)
Cash flows from financing activities:
Dividend payment to Members		(22,000	)
Borrowings from Members		7,000
Net cash used in financing activities		(15,000	)
Decrease in cash and cash equivalents		(754	)
Cash and cash equivalents at beginning of year		27,401
Cash and cash equivalents at end of year	$	26,647
Supplemental cash flow information:
Cash paid for income taxes	$	3,900

See accompanying notes to consolidated financial statements.

5

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

(1) Organization and Basis of Presentation

Technicolor Cinema Advertising, LLC and subsidiaries (TCA or the Company), which do business as Screenvision, provide advertising services to certain third-party theatre circuits in the United States through agreements expiring at various dates through January 2021 (with extension options through January 2026). The Company operates in one business segment.

As more fully described in note 6, TCA was formed on July 28, 2001 as a joint venture between Carlton Communications plc (Carlton) and two wholly owned subsidiaries of Thomson SA (Thomson) (Thomson and Carlton collectively referred to as the Members). Carlton, now known as Carlton Communications Limited, was subsequently acquired by ITV plc (ITV) in February 2004.

(2) Summary of Significant Accounting Policies

(a) Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Technicolor Cinema Advertising, LLC and its subsidiaries; Screenvision Direct Holdings, Inc., Screenvision Holdings, Inc., Screenvision Exhibition, Inc., Screenvision Direct, Inc., Screenvision Cinema Network, LLC, Screenvision Billboard Holdings, Inc., Screenvision Exhibition, LLC, and Screenvision Billboard Network, LLC, all of which are wholly owned. All intercompany accounts and transactions have been eliminated in consolidation.

The Company has no investments in entities requiring consolidation in accordance with ASU 2009-17, Consolidations (Topic 810): Improvements to Financial Reporting Involved with Variable Interest Entities.

(b) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant estimates include the useful lives of fixed assets, accounts receivable, and accrued liabilities, including accrued theatre circuit share expense, and valuation of goodwill and intangibles.

(c) Revenue Recognition

Advertising revenue, net of agency commission, is recognized based on the number of days in the period in which an advertising contract is fulfilled, adjusted for delivered theatre attendees. Deferred revenue refers to the unearned portion of advertising contracts. The Company’s advertising contracts regularly contain make-good provisions should delivered attendance be less than the contracted attendance. Revenue is reduced for make-good provisions when there is an underdelivery of attendance.

6 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

(d) Barter Transaction

The Company generates revenue from the exchange of advertising for branded preshow trivia. Barter revenues and expenses were recorded at the fair market value of the advertising services given by the Company. Revenue from barter transactions, which is equal to the related expenses, is recognized as income over the term of the agreement. Barter expense is recognized when the products and services are delivered. Gross barter revenue/expense amounted to $1,500 for the year ended December 31, 2009.

(e) Operating Costs

Cost of revenue includes advertising-related costs such as personnel and other costs related to advertising fulfillment, production costs of nondigital advertising, digital network costs including satellite bandwidth, repairs, and other costs of maintaining and operating the digital network and preparing advertising and other content for transmission across the digital network, and theatre circuit share costs payable to theatre circuits under multiyear agreements.

Under such agreements, theatre circuits grant to the Company the right to sell advertising for display in the facilities of the theatre circuits. In certain of its agreements, in return for these rights, the Company is required to make periodic payments to the theatre circuit equal to the greater of a cumulative minimum guaranteed amount (based on theatre attendance, the number of screens or a set payment schedule), or a set contractual percentage of cumulative revenue earned from advertising sales. In other agreements, there is either a set contractual percentage or a fee per advertisement placed but no minimum guaranteed amount.

For each agreement, the Company incurs as expense in a reporting period, the greater of (i) the cumulative minimum guaranteed amount or (ii) the amount derived by applying the contractual percentage to cumulative revenue earned from advertising sales less (iii) amounts incurred as expense in all previous reporting periods. In contracts with a minimum guaranteed amount based on a set payment schedule, the expense is determined by the straight-line method. Any additional expense based on net admissions is recognized in the period incurred.

(f) Cash and Equivalents

All highly liquid debt instruments and investments purchased with an original maturity of three months or less are classified as cash equivalents. Periodically, there are cash balances in a bank in excess of the federally insured limits or in the form of a money market demand account with a major financial institution. The Company has not experienced losses in these accounts.

(g) Accounts Receivable

An allowance for doubtful accounts is recorded based on a combination of historical experience, aging analysis, and information on specific accounts. The Company provides advertising services to a large number of geographically dispersed companies across a wide range of industries. The Company extends credit to these companies and historically has not experienced significant losses

7 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

relating to receivables from individual customers or groups of customers. The collectibility risk for national advertisers is reduced by dealing with large, nationwide entities who have strong reputations in the advertising industry and stable financial conditions.

For the year ended December 31, 2009, the Company’s two largest customers accounted for approximately 12% of revenues. In addition, two customers had an accounts receivable balance, which represented 17% and 10%, respectively, of the Company’s accounts receivable as of December 31, 2009.

(h) Operating Leases

Rent expense for operating leases, which may have escalating rentals over the term of the lease, is recorded on a straight-line basis over the initial lease term. The initial lease term includes the “build-out” period of leases, where no rent payments are typically due under the terms of the lease. The difference between rent expense and rent paid is recorded as deferred rent. Construction allowances received from landlords are recorded as a deferred rent credit and amortized to rent expense over the initial term of the lease.

(i) Property and Equipment

Property and equipment, which include amounts recorded under capital leases, are stated at cost net of accumulated depreciation or amortization. Major renewals and improvements are capitalized, while replacements, maintenance, and repairs that do not improve or extend the lives of the respective assets are expensed as incurred. The Company records depreciation and amortization using the straight-line method over the following estimated useful lives:

Theatre equipment	3 – 5 years
Furniture and equipment	5 years
Computer hardware and software	3 – 5 years
Leasehold improvements	Lesser of lease term or asset life

(j) Fair Value of Financial Instruments

The Company estimates the fair value of financial instruments using the available market information. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts the Company could realize in a current market exchange. As of December 31, 2009, the carrying value of current assets and current liabilities approximated fair value due to the short-term maturity of these instruments.

(k) Goodwill, Intangible Assets, and Long-Lived Assets

The Company accounts for goodwill and other intangible assets in accordance with Accounting Standards Codification (ASC) 350-10, Intangibles – Goodwill and Other (formerly SFAS No. 142, Goodwill and Other Intangible Assets). Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination,

8 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

and is not subject to amortization. Intangible assets resulting from the acquisitions of entities accounted for using the purchase method of accounting are estimated by management based on the fair value of assets received.

The Company evaluates the recoverability of its goodwill annually or more frequently whenever events or circumstances indicate that the asset may be impaired. Goodwill impairment is determined using a two-step process. The first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of goodwill impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill, which would be recognized in a business combination.

ASC 350-10 also requires that intangible assets with finite useful lives and other long-lived assets be amortized over their respective estimated useful lives, and reviewed for impairment in accordance with ASC 360, Property, Plant and Equipment (formerly SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets), whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company periodically evaluates its long-lived assets based on, among other factors, the estimated, undiscounted future cash flows expected to be generated from such assets in order to determine if an impairment exists. The Company’s intangible assets primarily comprise of customer lists, theatre circuit agreements, and covenants not to compete and are amortized over periods up to five years on a straight-line basis with a weighted average amortization period as follows:

Customer lists	0.8 years
Theatre circuit agreements	3.2 years
Covenants not to compete	0.3 years

(l) Income Taxes

The Company has elected to be treated as a C Corporation for U.S. federal income tax purposes. As such, the Company is subject to U.S. federal and all applicable state and local taxes.

The Company accounts for income taxes pursuant to ASC 740, Income Taxes (formerly SFAS No. 109, Accounting for Income Taxes). Under ASC 740, deferred tax assets and liabilities are determined based on temporary differences between the basis of assets and liabilities for income tax and financial reporting purposes. The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences.

9 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

The Company maintains valuation allowances where it is more likely than not that all or a portion of a deferred tax asset will not be realized. In determining whether a valuation allowance is warranted, the Company evaluates factors such as prior earnings history, expected future earnings, carryback and carryforward periods, and tax strategies that could potentially enhance the likelihood of the realization of a deferred tax asset. Based upon historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that the Company will realize the benefits of these deductible differences at December 31, 2009.

Beginning with the adoption of FASB Interpretation No. 48 (FIN 48), Accounting for Uncertainty in Income Taxes, (included in ASC 740, Income Taxes), as of January 1, 2009, the Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurements are reflected in the period in which the change in judgment occurs. Prior to the adoption of FIN 48, the Company recognized the effect of income tax positions only if such positions were probable of being sustained.

(m) Comprehensive Income

Total comprehensive income includes, in addition to net income, changes in equity that are excluded from the consolidated statements of operations and are recorded in a separate section of members’ equity on the consolidated balance sheets. The Company does not have any transactions that would require disclosure as comprehensive income.

(n) Recent Accounting Pronouncements

On July 1, 2009, the Company adopted the FASB Accounting Standards Codification (ASC or Codification). The Codification does not alter current U.S. GAAP, but it integrates existing accounting standards with other authoritative guidance. The Codification provides a single source of authoritative U.S. GAAP for nongovernmental entities and supersedes all other previously issued accounting and reporting guidance. The adoption of the Codification did not have any effect on the results of operations or financial position. All prior references to U.S. GAAP have been revised to conform to the Codification. Updates to the Codification are issued in the form of Accounts Standards Updates (ASU).

Effective January 1, 2009, the Company adopted an accounting standard update regarding the determination of the useful life of intangible assets. As codified in ASC 350-30-35, this update amends the factors considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under intangibles accounting. It also requires a consistent approach between the useful life of a recognized intangible asset under prior business combination accounting and the period of expected cash flows used to measure the fair value of an asset under the new business combinations accounting (as currently codified under ASC 850). The update also requires enhanced disclosures when an intangible asset’s expected future cash flows are affected by an entity’s intent and/or ability to renew or extend the arrangement. The adoption did not have a significant impact on the Company’s financial statements.

10 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

In May 2009, the FASB issued authoritative guidance on subsequent events, which is effective for the Company June 30, 2009. This guidance addresses the disclosure of events that occur after the balance sheet date, but before financial statements are issued or available to be issued. The adoption of this guidance did not have a significant impact on the consolidated financial statements.

In October 2009, the FASB issued ASU No. 2009-13, Multiple-Deliverable Revenue Arrangements, which revises the existing multiple-element revenue arrangements guidance and changes the determination of when the individual deliverables included in a multiple-element revenue arrangement may be treated as separate units of accounting, modifies the manner in which the transaction consideration is allocated across the separately identified deliverables and expands the disclosures required for multiple-element revenue arrangements. The pronouncement is effective for financial statements issued after December 31, 2010. The Company is evaluating the impact of ASU No. 2009-13 on its consolidated financial statements.

(3) Property and Equipment

Property and equipment, which includes assets under capital leases, as of December 31, 2009 was comprised as follows:

Theatre equipment	$	50,339
Furniture and equipment		7,391
Computer hardware and software		2,679
Leasehold improvement		2,754
		63,163
Accumulated depreciation		(36,554	)
	$	26,609

The total depreciation expense for the year ended December 31, 2009 was $11,348. Gain on disposal of property and equipment was $124 for the year ended December 31, 2009.

In certain of its theatre circuit agreements, the Company has an asset retirement obligation whereby it must deinstall and remove theatre equipment at the end of the term. Amounts accrued at contract inception, which represent the present value of the related obligation, result in a corresponding increase to property and equipment which are depreciated over the useful life as a component of the related property and equipment.

11 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

Changes in the asset retirement obligation for the year ended December 31, 2009 are as follows:

Accrual asset retirement obligation, beginning of year	$	2,477
Current year liability		390
Accretion expense		132
Settlement		(68	)
Accrued asset retirement obligation, end of year	$	2,931

(4) Goodwill and Intangible Assets

Intangible assets as of December 31, 2009 were comprised as follows:

	Gross carrying amount		Amortization period		Accumulated amortization
Amortizing intangible assets:
Theatre circuit agreements	$	8,453		2 to 5 years	$	6,995
Other		355		0.02 to 2 years		355
Total	$	8,808			$	7,350

Other intangibles include covenants not to compete and customer lists. Amortization expense for the year ended December 31, 2009 was $1,484. Amortization expense for each of the next five is expected to be $1,442, $16, $0, $0 and $0, respectively.

Goodwill was reduced by $81 in 2009 for the impact of second component tax deductible goodwill.

Goodwill was $64,479 as of December 31, 2009.

(5) Members’ Equity

As discussed in note 1, on July 28, 2001, the Company was formed as a joint venture between Carlton and Thomson whereby Carlton contributed an operating subsidiary and cash of $1,000 and Thomson contributed an operating subsidiary and cash of $41,508, of which $32,008 was used to repay debt and accrued interest owed to Carlton. In addition, $6,492 was paid directly to Carlton by Thomson. Immediately subsequent to the transactions, Carlton owned 56,000 Series A shares and Thomson owned 56,000 Series B shares. The net assets contributed by Thomson and Carlton were recorded at a historical cost of $109 million on the date of formation. Net assets consisted primarily of cash, property and equipment, intangibles, goodwill, and operating accruals.

12 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

In April 2002, the Company issued 500 Series B shares to Thomson for $500 and 500 Series A shares to Carlton for $500.

In September 2002, the Company issued 4,500 Series B shares to Thomson for $4,500 and 4,500 Series A shares to Carlton for $4,500 to finance the Company’s 2002 acquisition of Val Morgan & Co. Pty Limited.

As of December 31, 2009, there were 61,000 Series A shares authorized, issued, and outstanding and 61,000 Series B Shares authorized, issued, and outstanding. Series A and Series B shares have identical rights and privileges. Distributions are determined by a supermajority approval (as defined) of the Board of Members in proportion to the number of shares held by each member. The Company operates as a limited liability company and the liabilities of the Company are solely the liabilities of the Company and no member is personally responsible for such liability.

On December 23, 2009, the Company made a cash dividend distribution to Carlton and Thomson of $11,000 and $11,000, respectively.

(6) Income Taxes

The provision for income taxes on continuing operations for the year ended December 31, 2009 consists of:

Federal income taxes:
Current	$	4,226
Deferred		1,531
State and local income taxes:
Current		1,797
Deferred		722
	$	8,276

Effective Tax Rate Reconciliation on Continuing Operations

A reconciliation of the effective income tax rate on continuing operations as reflected in the consolidated statements of operations to the U.S. federal statutory income tax rate for the year ended December 31, 2009 is as follows:

U.S. federal statutory income tax rate		35.0	%
Federal taxes at the statutory rate	$	5,643
State and local income taxes, net of federal income tax benefit		1,798
Other		835
Effective tax rate:		51.33	%

13 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

The net current and noncurrent components of deferred income taxes recognized in the balance sheet as of December 31, 2009 are as follows:

Net current asset	$	2,359
Net noncurrent liability		(11,613	)
	$	(9,254	)

The tax effects of the temporary difference that give rise to significant portions of the deferred tax assets and liabilities as of December 31, 2009 are as follows:

Assets:
Allowance for doubtful accounts	$	1,213
Intangible assets		5,713
Accrued theatre commissions		1,890
Other		2,402
Gross deferred tax assets		11,218
Liabilities:
Property and equipment		(4,143	)
Goodwill		(16,149	)
Other		(180	)
Gross deferred tax liabilities		(20,472	)
Net deferred tax liabilities	$	(9,254	)

The Company had available net operating loss carryforwards for tax purposes of $0 at the end of 2009.

The 2008 carryforward was due to expire in the tax year ended December 31, 2028, but was fully utilized in 2009.

The Company is currently a party to a federal tax audit for the tax year ended December 31, 2006. This audit commenced on September 30, 2009.

The Company is currently preparing its 2008 federal tax return and has made timely estimated tax payments through 2009. The Company is preparing its 2007 and 2008 state returns and has made timely estimated payments through 2009.

Included in prepaid expenses are federal and state prepaid taxes of approximately $13,262 at December 31, 2009.

Goodwill of $71,890 arising from acquisitions is deductible for tax purposes.

14 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

The Company adopted the guidance relating to accounting for uncertainty in income taxes, in accordance with ASC 740, Income Taxes, on January 1, 2009. Upon adoption, the Company recorded a cumulative effect of a change in accounting principle by recording an increase in the liability for gross unrecognized tax benefits of $1,990 ($1,274, net of federal benefit) which was accounted for as a reduction to the January 1, 2009 balance of retained earnings.

The Company recognized an additional $398 to this liability in 2009 and had a total liability for uncertain tax positions of $2,359 ($1,533, net of federal benefit), on its balance sheet.

The Company recognizes interest and penalties for income tax matters in income tax expense. Interest and penalty expense recognized related to uncertain tax positions amounted to respectively $196 and $74 in 2009.

Total accrued interest and penalties as of December 31, 2009 was $1,121 ($915, net of federal benefit).

The Company does not expect the total amounts of unrecognized tax benefits to increase or decrease significantly within 12 months of December 31, 2009.

(7) Related-Party Transactions

The Company and an operating subsidiary of Thomson are party to an agreement dated March 3, 2005 whereby the operating subsidiary provides digital equipment and software reseller, integration and installation services, access to its content distribution system, network management system and other related operating systems, related maintenance and support services, and content preparation services. The agreement expires on March 3, 2011. In addition, the Company and another operating subsidiary of Thomson were party to an agreement dated June 15, 2006 whereby the operating subsidiary provided film print production, distribution, and content preparation services. This agreement expires on December 31, 2010. For the year ended December 31, 2009, the Company acquired from Thomson’s operating subsidiaries $2,583 for reseller, purchase, and integration and installation services. These amounts have been capitalized as theatre equipment. For the year ended December 31, 2009, the Company incurred $15,647 for all other services.

The Company participates in the Thomson corporate insurance program for property, casualty, and workers compensation insurance. The Company incurred expense of $140 for the year ended December 31, 2009.

ITV provides certain tax accounting services to the Company. The Company incurred expense of $29 for the year ended December 31, 2009.

A former executive of the Company is covered by a benefit plan administered by ITV to which the Company made contributions of $75 for the year ended December 31, 2009.

The Company had a payable due to the Thomson and ITV operating subsidiaries of $4,342 as of December 31, 2009.

15 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

On April 23, 2002, the Company signed a Term Facility agreement (the Term Agreement) with the Members under which the Company could borrow up to $24,000. Interest is payable quarterly at 150 basis points over LIBOR. On December 22, 2009, the Company borrowed $7,000 under the Term Agreement. Borrowings under the Term Agreement were funded by the Members pro rata to their ownership of the Company and are repayable upon the joint demand of the Members. Interest expense incurred by the Company for the period ended December 31, 2009 was $3.

(8) Commitments and Contingencies

The Company leases office facilities for its headquarters in New York, New York, and also in various other cities for its sales and marketing personnel as sales offices.

Future minimum lease payments under noncancelable operating leases are as follows:

2010	$	2,068
2011		1,562
2012		180
2013		153
Total	$	3,963

Total rent expense for the year ended December 31, 2009 was $2,033.

The following is a schedule of minimum future lease payments required as of December 31, 2009, under capital leases for Computer Hardware:

	Principal		Interest		Total
2010	$	34		3		37
2011		34		2		36
2012		30		1		31
Total	$	98		6		104

Future minimum payments due under theatre circuit agreements are as follows:

2010	$	11,950
2011		5,850
Total	$	17,800

Total theatre circuit share expense included in cost of revenue for the year ended December 31, 2009 was $76,881. Accrued theatre circuit liability as of December 31, 2009 was $25,819 and is included in accrued liabilities.

16 (Continued)

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 2009

(Amounts in thousands except shares)

During 2010, the Company has renegotiated several theatre circuits to extend cinema advertising. In connection with these amended agreements, the Company paid $2,925 in 2010 as signing bonuses.

As of December 31, 2009, the Company was committed to install digital advertising systems at eleven theatre circuits, representing an approximate cost of $3,908.

The Company renewed an agreement with a supplier of theatre kiosks requiring payments amounting to $1,735 during 2010.

Future severance payments due under severance agreements are as follows:

2010	$	691
2011		88
Total	$	779

The Company has employment agreements with certain key employees. The agreements provide terms for severance in the event of termination for other than cause as well as confidentiality and noncompetition clauses. The maximum contingent liability under such agreement as of December 31, 2009 is approximately $1,984.

The Company is currently evaluating potential sales and use tax exposures in various jurisdictions.

The Company is subject to claims and legal actions in the ordinary course of business. The Company believes such claims will not have a material adverse effect on its financial position or results of operations.

(9) Retirement Plans

The Company has a defined contribution savings plan, which qualifies under Section 401(k) of the Internal Revenue Code (the Code). The plan allows eligible employees to voluntarily contribute amounts not exceeding the maximum allowed under the Code. The Company matches up to 33% of employee contributions, limited to 5% of compensation. Contributions to the plan are at the discretion of the Company. Plan expense for the year ended December 31, 2009 was $272.

(10) Subsequent Events

The Company has evaluated subsequent events from the balance sheet date through August 12, 2010, the date at which the financial statements were available to be issued, and determined there are no other items to disclose.

17

EX-99.4

Exhibit 99.4

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Condensed Consolidated Financial Statements

As of June 30, 2010 and December 31, 2009

and for Each of the Six Months in the Periods Ended

June 30, 2010 and June 30, 2009

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

June 30, 2010 and December 31, 2009

(Amounts in thousands)

(Unaudited)

	2010		2009
Assets
Current assets:
Cash and cash equivalents	$	27,763		26,647
Accounts receivable, less allowance for doubtful accounts of $2,904 and $2,871 as of June 30, 2010 and
December 31, 2009, respectively		44,379		60,539
Prepaid expense and other current assets		17,084		14,861
Deferred taxes		4,536		2,359
Total current assets		93,762		104,406
Property and equipment, net		27,308		26,609
Goodwill		64,480		64,479
Intangibles, net		737		1,458
Other assets		12,057		9,870
Total assets	$	198,344		206,822
Liabilities and Members’ Equity
Current liabilities:
Accounts payable	$	2,297		2,556
Accrued liabilities		32,863		37,647
Due to members		12,225		11,342
Deferred revenue		4,961		8,672
Total current liabilities		52,346		60,217
Deferred taxes		13,320		11,613
Other noncurrent liabilities		2,441		4,059
Total liabilities		68,107		75,889
Commitments and contingencies
Members’ equity		130,237		130,933
Total liabilities and members’ equity	$	198,344		206,822

See accompanying notes to condensed consolidated financial statements.

2

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

Six months ended June 30, 2010 and 2009

(Amounts in thousands)

(Unaudited)

	2010			2009
Revenue	$	79,106			63,094
Operating expenses:
Cost of revenue		51,092			45,030
Selling and marketing costs		13,641			14,061
Administrative costs		9,213			8,595
Depreciation and amortization		6,335			6,394
Operating loss		(1,175	)		(10,986	)
Interest income, net		27			97
Other income, net		86			256
Loss before provision for income taxes		(1,062	)		(10,633	)
Income tax benefit		364			4,797
Net loss	$	(698	)		(5,836	)

See accompanying notes to condensed consolidated financial statements.

3

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

Six months ended June 30, 2010 and 2009

(Amounts in thousands)

(Unaudited)

	2010			2009
Cash flows from operating activities:
Net loss	$	(698	)		(5,836	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		6,335			6,394
Gains on disposals of property and equipment		—			(6	)
Provision for bad debt, net of write-offs		33			112
Deferred income tax		(470	)		(4,895	)
Asset retirement obligation accretion cost		69			65
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		16,128			26,847
Prepaid expense and other current assets		(4,412	)		(4,263	)
Accounts payable and accrued expenses		(5,127	)		(3,522	)
Due to Members		304			(6,096	)
Deferred revenue		(3,711	)		(1,593	)
Other noncurrent assets and liabilities		(1,618	)		(3,032	)
Net cash provided by operating activities		6,833			4,175
Cash flows from investing activities:
Capital expenditures		(5,717	)		(5,127	)
Proceeds from sales of property and equipment		—			228
Net cash used in investing activities		(5,717	)		(4,899	)
Increase (decrease) in cash and cash equivalents		1,116			(724	)
Cash and cash equivalents at beginning of period		26,647			27,401
Cash and cash equivalents at June 30	$	27,763			26,677
Supplemental cash flow information:
Cash paid for income taxes	$	2,951			1,459

See accompanying notes to condensed consolidated financial statements.

4

TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

(1) Organization and Basis of Presentation

Technicolor Cinema Advertising, LLC and subsidiaries (TCA or the Company), which do business as Screenvision, provide advertising services to certain third-party theatre circuits in the United States through agreements expiring at various dates through January 2021 (with extension options through January 2026). The Company operates in one business segment.

TCA was formed on July 28, 2001 as a joint venture between Carlton Communications plc (Carlton) and two wholly owned subsidiaries of Thomson SA (Thomson) (Thomson and Carlton collectively referred to as the Members). Carlton, now known as Carlton Communications Limited, was subsequently acquired by ITV plc (ITV) in February 2004.

TCA has prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information. This information reflects all adjustments which in the opinion of management are necessary for a fair presentation of the statement of financial position as of June 30, 2010, and the results of operations for the six month periods ended June 30, 2010 and 2009 and cash flows for the six month periods ended June 30, 2010 and 2009. The results of operations for the interim periods are not necessarily indicative of the results that might be expected for future interim periods or for the full year ending December 31, 2010. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted. The Company believes that the disclosures are adequate to make the information presented not misleading.

These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s audited financial statements for the fiscal year ended December 31, 2009. That report includes a summary of the Company’s critical accounting policies. There have been no material changes in the Company’s accounting policies during the first six months of 2010.

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TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

(2) Property and Equipment

Property and equipment, which includes assets under capital leases, as of June 30, 2010 and December 31, 2009 was comprised as follows:

	2010			2009
Theatre equipment	$	55,601			50,339
Furniture and equipment		7,624			7,391
Computer hardware and software		3,375			2,679
Leasehold improvement		2,761			2,754
		69,361			63,163
Accumulated depreciation		(42,053	)		(36,554	)
	$	27,308			26,609

The total depreciation expense for the six months ended June 30, 2010 and 2009 was $5,614 and $5,652, respectively. Gains on disposal of property and equipment were $0 and $43 for the six months ended June 30, 2010 and 2009, respectively.

In certain of its theatre circuit agreements, the Company has an asset retirement obligation whereby it must deinstall and remove theatre equipment at the end of the term. Amounts accrued at contract inception, which represent the present value of the related obligation, result in a corresponding increase to property and equipment which are depreciated over the useful life as a component of the related property and equipment. The asset retirement obligation was $3,173 and $2,931 as of June 30, 2010 and December 31, 2009, respectively.

(3) Goodwill and Intangible Assets

Intangible assets as of June 30, 2010 and December 31, 2009 were comprised as follows:

	2010
	Gross carrying amount		Amortization period		Accumulated amortization
Amortizing intangible assets:
Theatre circuit agreements	$	8,453		2 to 5 years	$	7,716
Other		355		0.02 to 2 years		355
Total	$	8,808			$	8,071

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TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

	2009
	Gross carrying amount		Amortization period		Accumulated amortization
Amortizing intangible assets:
Theatre circuit agreements	$	8,453		2 to 5 years	$	6,995
Other		355		0.02 to 2 years		355
Total	$	8,808			$	7,350

Other intangibles include covenants not to compete and customer lists. Amortization expense for the six months ended June 30, 2010 and 2009 was $721 and $742, respectively.

(4) Income Taxes

For the six months ended June 30, 2010 and 2009, our income tax benefits were $364 and $4,797, respectively, based on effective income tax rates of 34.27% and 45.11%, respectively.

The Company is preparing its 2007 through 2009 state tax returns and has made timely estimated tax payments for 2010.

Included in prepaid expenses are federal and state prepaid taxes of approximately $15,236 and $13,262 at June 30, 2010 and December 31, 2009, respectively.

The Company adopted the guidance relating to accounting for uncertainty in income taxes, in accordance with ASC 740, Income Taxes, on January 1, 2009. Upon adoption, the Company recorded a cumulative effect of a change in accounting principle by recording an increase in the liability for gross unrecognized tax benefits of $1,990 ($1,274, net of federal benefit) which was accounted for as a reduction to the January 1, 2009 balance of retained earnings.

During the six month periods ended June 30, 2010 and 2009, no additional amounts were recognized to this liability as there were no changes in judgment or interpretation to this tax position during these periods.

The Company recognized an additional $398 ($259, net of federal benefit) to this liability in December 2009 as a result of known information at that time. The total liability for uncertain tax positions as of June 30, 2010 and December 31, 2009 was $2,359 ($1,533, net of federal benefit).

The Company expects approximately $2,263 of unrecognized tax benefits to reverse within 12 months of the reporting date, June 30, 2010.

The Company recognizes interest and penalties for income tax matters in income tax expense. Interest and penalty expense recognized related to uncertain tax positions amounted to respectively $106 and $0 for the six months ended June 30, 2010 and respectively $98 and $0 for the six months ended June 30, 2009. The Company recognized an additional $74 in penalties in December 2009. Total accrued interest and penalties as of June 30, 2010 and December 31, 2009 were $1,227 ($984, net of federal benefit) and $1,121 ($915, net of federal benefit), respectively.

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TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

The Company is currently under examination by the Internal Revenue Service for the tax year ended December 31, 2006.

(5) Related-Party Transactions

The Company and an operating subsidiary of Thomson are party to an agreement dated March 3, 2005 whereby the operating subsidiary provides digital equipment and software reseller, integration and installation services, access to its content distribution system, network management system and other related operating systems, related maintenance and support services, and content preparation services. The agreement expires on March 3, 2011. In addition, the Company and another operating subsidiary of Thomson were party to an agreement dated June 15, 2006 whereby the operating subsidiary provided film print production, distribution, and content preparation services. This agreement expires on December 31, 2010. For the six months ended June 30, 2010 and 2009, the Company purchased from Thomson’s operating subsidiaries $2,801 and $836, respectively, of equipment and installation services which have been capitalized as theatre equipment. For the six months ended June 30, 2010 and 2009, the Company incurred $7,604 and $6,848, respectively, for all other services.

The Company participates in the Thomson corporate insurance program for property, casualty, and workers compensation insurance. The Company incurred expense of $64 and $67 for the six months ended June 30, 2010 and 2009, respectively.

ITV provides certain tax accounting services to the Company. The Company incurred expense of $1 and $29 for the six months ended June 30, 2010 and 2009, respectively.

The Company had a payable due to the Thomson and ITV operating subsidiaries of $5,226 and $4,342 as of June 30, 2010 and December 31, 2009, respectively.

On April 23, 2002, the Company signed a Term Facility agreement (the Term Agreement) with the Members under which the Company could borrow up to $24,000. Interest was payable quarterly at 150 basis points over LIBOR. Borrowings under the Term Agreement were funded by the Members pro rata to their ownership of the Company. On December 22, 2009, the Company borrowed $7,000 under the Term Agreement. Borrowings under the Term Agreement were funded by the Members pro rata to their ownership of the Company and are repayable upon the joint demand of the Members. The Company repaid the outstanding balance of $7,000 in August 2010. Interest expense incurred by the Company for the six months ended June 30, 2010 was $62.

(6) Commitments and Contingencies

The Company leases office facilities for its headquarters in New York, New York, and also in various other cities for its sales and marketing personnel as sales offices.

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TECHNICOLOR CINEMA ADVERTISING, LLC

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Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

Future minimum lease payments under noncancelable operating leases are as follows:

2010	$	1,020
2011		1,562
2012		180
2013		153
Total	$	2,915

Total rent expense for the six months ended June 30, 2010 and 2009 was $1,000 and $1,054, respectively.

The following is a schedule of minimum future lease payments required as of June 30, 2010, under capital leases for computer hardware:

	Principal		Interest		Total
2010	$	17		2		19
2011		34		2		36
2012		30		1		31
Total	$	81		5		86

Future minimum payments due under theatre circuit agreements are as follows:

2010	$	6,070
2011		5,850
Total	$	11,920

Total theatre circuit share expense included in cost of revenue for the six months ended June 30, 2010 and 2009 was $36,121 and $31,996, respectively. Accrued theatre circuit liability as of June 30, 2010 and December 31, 2009 was $19,542 and $25,819, respectively, and is included in accrued liabilities.

During 2010, the Company has renegotiated several theatre circuits to extend cinema advertising. In connection with these amended agreements, the Company paid $2,750 before June 30, 2010 as signing bonuses.

As of June 30, 2010, the Company was committed to install digital advertising systems at seventeen theatre circuits, representing an approximate cost of $1,986.

The Company renewed an agreement with a supplier of theatre kiosks requiring payments amounting to $755 and $1,293 during 2010 and 2011, respectively.

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TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

The Company has employment agreements with certain key employees. The agreements provide terms for severance in the event of termination for other than cause as well as confidentiality and noncompetition clauses. The maximum contingent liability under such agreement as of June 30, 2010 is approximately $1,700.

Two former executives have left the Company in the period ended June 30, 2010. The Company has accrued a severance amount for one executive. The Company denies any liability and intends to vigorously defend itself against the claims of the second executive. Any settlement by the Company has been indemnified by the Members in connection with the change in ownership in October 2010 (see note 7).

The Company is currently evaluating potential sales and use tax exposures in various jurisdictions.

The Company is subject to claims and legal actions in the ordinary course of business. The Company believes such claims will not have a material adverse effect on its financial position or results of operations.

(7) Subsequent Events

The Company has evaluated subsequent events from the balance sheet date through December 21, 2010, the date at which the financial statements were available to be issued, and determined that, except for those noted below, there are no other items to disclose.

(a) Change in Ownership

On October 14, 2010, through a series of transactions, TCA became a wholly owned subsidiary of SV Holdco, LLC a Delaware limited liability company (Newco) and TCA changed its name to Screenvision, LLC (Screenvision).

The series of transactions are as follows:

• Carlton redeemed 100% of its 61,000 Series B shares of TCA for $80,000

• Thomson redeemed 45,750 (75%) of its Series A shares of TCA for $60,000

• Thomson exchanged its remaining 15,250 Series A shares of TCA for 715,294 Class A Common Units of Newco

• Shamrock Capital Growth Fund II, L.P. (SCGF) contributed $40,000 to Newco in exchange for 1,430,588 Class A Common Units of Newco

• Shamrock Screenvision Co-Invest I, LLC (SSCI) contributed $25,000 to Newco in exchange for 894,118 Class A Common Units of Newco SCGF and SSCI are affiliated entities.

In addition, on October 14, 2010, TCA amended its Theatre Agreement dated September 20, 2006 with Carmike Cinemas, Inc. (Carmike) whereby the term of the Agreement was extended for an additional 30 years through July 1, 2042. Other than the extension of the term, the operational provisions of the Agreement are not significantly changed, including the ongoing monthly

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TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

attendance-based payments from TCA. In connection with this amendment, TCA will pay Carmike $30,000 in January 2011 and Carmike has received 760,000 Class C Common Units of Newco. Carmike may also receive additional units, all of which may be subject to forfeiture, or may forfeit some of its issued units, based upon changes in Carmike’s future theatre and screen count.

As a result of these transactions, the ownership structure of Newco is as follows:

	Units		Percentage of class			Percentage of total
Class A Common Units:
Thomson		715,294		23.5	%		18.8	%
SCGF		1,430,588		47.1			37.7
SSCI		894,118		29.4			23.5
Total Class A
Common Units		3,040,000		100.0	%		80.0
Class C Common Units:
Carmike Cinemas Inc.		760,000		100.0	%		20.0
Total Class
C Common Units		760,000		100.0	%		20.0
Total Units Outstanding		3,800,000					100.0	%

(b) Related-Party Transaction

Newco has entered into a Management Services Agreement dated October 14, 2010 with Shamrock Capital Advisors, Inc., an affiliate of SCGF and SSCI (SCA) whereby SCA will provide management and consulting services to Newco for an annual fee of $400.

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TECHNICOLOR CINEMA ADVERTISING, LLC

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Amounts in thousands except shares)

(Unaudited)

(c) Debt

To facilitate the redemption of Carlton shares, Newco entered into a Loan and Security Agreement dated October 14, 2010 (Agreement) whereby Screenvision borrowed $80,000 in a term loan and has available up to $10,000 in revolving loans.

The $80,000 term loan has an interest rate of LIBOR plus a margin of 3.25%. Screenvision is currently required to make 19 consecutive principal repayments of the term loan in the amount of $2,000 on the last day of each calendar quarter starting with December 31, 2010, with a balance of $42,000 due at final maturity on October 14, 2015.

The $10,000 revolving credit facility has an interest rate of LIBOR plus a margin of 3.25%, or base rate plus a margin 2.25%, as Screenvision may elect. In addition, Screenvision is required to pay commitment fees quarterly on the unused portion of the new revolving credit facility. The commitment fee rate is 0.50% per annum. The final maturity date of the new revolving credit facility is October 14, 2015. There was no outstanding balance on the revolving credit facility at November 8, 2010.

The Agreement requires that mandatory prepayments be made from (1) 100% of the net cash proceeds from certain asset sales in excess of $500, (2) 100% of the net cash proceeds from issuance of certain debt obligations, (3) 50% of the net cash proceeds from the issuance of certain equity securities, and (4) either 0% or 50% (depending on our consolidated leverage ratio) of excess cash flow as defined in the Agreement.

The term loan and revolving credit facilities are guaranteed by Newco and its subsidiaries and secured by a perfected first priority security interest in substantially all of Newco’s present and future assets.

The Agreement contains covenants which, among other things, restrict Newco’s ability, and that of its subsidiaries, to (1) incur additional indebtedness; (2) create liens on their assets; (3) consolidate, merge or otherwise transfer all or any substantial part of their assets; (4) sell or otherwise dispose of their assets; and (5) engage in businesses other than those in which Newco is currently engaged or those reasonably related thereto. The Agreement contains financial covenants that require Newco to maintain a ratio of funded debt to adjusted EBITDA of no more than 3.00, and a ratio of adjusted EBITDA to interest expense/debt payments of no less than 1.25. Beginning with the three month period ending March 31, 2011, the financial covenants contain normal and customary periodic changes in the required ratios over the life of the Agreement.

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