NOTE 4—ACQUISITIONS

On July 12, 2011, the Company completed its purchase of certain assets of Davis Theatres for $2.6 million. The acquisition of Davis Theatres consisted of one theatre with six screens in Dothan, Alabama. As a result of the acquisition, the Company will be the leading movie exhibitor in the market. The Company has accounted for this transaction as an asset acquisition. The purchase price was allocated to the assets acquired, primarily equipment, based on their respective fair values.

On October 21, 2011, the Company completed its purchase of MNM Theatres for $10,820 including an estimate of the fair value of consideration that is contingent upon MNM's earnings performance over the next three years. The Company estimated the fair value of the contingent consideration to be $1,570 using a probability-weighted discounted cash flow model. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in ASC 820. The acquisition of MNM Theatres consisted of three theatres with forty screens in the Atlanta, Georgia area. The consolidated financial statements as of and for the year ended December 31, 2011 include the assets and the operating results for the period from the acquisition date through December 31, 2011. The acquisition was accounted for as a business combination, with the purchase price allocated based on estimated fair values of the assets acquired, including identifiable intangible assets and liabilities assumed. Acquisition costs were less than $100 and were charged to expense.

The goodwill recognized is attributable primarily to expected synergies to be realized by achieving cost reductions and eliminating redundant administrative functions. The goodwill is deductible for tax purposes and will be amortized over 15 years. MNM Theatres operated three theatres with forty screens in the Atlanta, Georgia area.

The following is a summary of the allocations of the aggregate purchase price to the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition. These fair values also represent Level 3 measures. The allocation is preliminary and may be adjusted in subsequent periods.


	MNM
Current assets	$	88
Building, leasehold improvements and equipment		2,015
Goodwill		8,087
Other intangible assets		630

Total purchase price	$	10,820

Pro Forma Results of Operations (Unaudited)

The following selected comparative unaudited pro forma results of operations information for the years ended December 31, 2011 and 2010 assumes the MNM Theatres acquisition occurred at the beginning of the fiscal year 2010, and reflects the full results of operations for the years presented. The pro forma results have been prepared for comparative purposes only and do not purport to indicate the results of operations which would actually have occurred had the combination been in effect on the dates indicated, or which may occur in the future.


	Year Ended December 31,						Pro Forma Year Ended December 31,
	2011			2010			2011			2010
Revenues	$	482,209		$	488,022		$	491,548		$	500,142
Operating income	$	35,158		$	24,281		$	37,341		$	26,501
Net loss	$	(7,710	)	$	(12,579	)	$	(5,677	)	$	(10,354	)
Loss per share:
Basic and Diluted	$	(0.60	)	$	(0.99	)	$	(0.44	)	$	(0.81	)

The Company recorded revenue and net income of $2,025 and $291, respectively, in its consolidated statements of operations from the acquisition date to the period ending December 31, 2011.