S-4/A

        AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 6, 2004



                                                     REGISTRATION NO. 333-113141

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                             ---------------------

                                AMENDMENT NO. 1


                                       TO


                                   FORM  S-4
                             REGISTRATION STATEMENT
                        UNDER THE SECURITIES ACT OF 1933
                             ---------------------

                                IMAX CORPORATION
             (Exact name of registrant as specified in its charter)

                                                                
             CANADA                              3861                            98-0140269
 (State or other jurisdiction of     (Primary Standard Industrial             (I.R.S. Employer
 incorporation or organization)       Classification Code Number)            Identification No.)



                             ---------------------
                                IMAX CORPORATION
                              2525 SPEAKMAN DRIVE,
                          MISSISSAUGA, ONTARIO L5K 1B1
                                 (905) 403-6500
  (Address, including zip code, and telephone number, including area code, of
                   registrant's principal executive offices)
                             ---------------------
                      SEE TABLE OF ADDITIONAL REGISTRANTS
                             ---------------------
                                ROBERT D. LISTER
                                IMAX U.S.A. INC.
                        110 E. 59TH STREET, SUITE 2100,
                            NEW YORK, NEW YORK 10022
                                 (212) 821-0100
 (Name, address, including zip code, and telephone number, including area code,
                             of agent for service)

                                WITH COPIES TO:

                                                      
                    BRICE T. VORAN                                           PHILIP C. MOORE
                SHEARMAN & STERLING LLP                                   MCCARTHY TETRAULT LLP
                    199 BAY STREET                                         55 KING STREET WEST
                  COMMERCE COURT WEST                                  TORONTO DOMINION BANK TOWER
               SUITE 4405, P.O. BOX 247                                   SUITE 4700, TD CENTRE
               TORONTO, ONTARIO M5L 1E8                                 TORONTO, ONTARIO M5K 1E6



                             ---------------------

    APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC: As soon as practicable after the effectiveness of the Registration
Statement to which this Amendment relates.


    If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box.  [ ]

    If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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.  [ ]

    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.  [ ]

                        CALCULATION OF REGISTRATION FEE




- --------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------------
                                                              PROPOSED MAXIMUM        PROPOSED MAXIMUM           AMOUNT OF
     TITLE OF EACH CLASS OF             AMOUNT TO BE           OFFERING PRICE            AGGREGATE              REGISTRATION
  SECURITIES TO BE REGISTERED            REGISTERED           PER SECURITY(1)        OFFERING PRICE(1)              FEE
- --------------------------------------------------------------------------------------------------------------------------------
                                                                                                
9 5/8% Senior Notes due 2010....        $160,000,000                100%                $160,000,000             $20,272(2)
Guarantees of 9 5/8% Senior
  Notes due 2010................             --                      --                      --                    --(3)
- --------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------------



(1) Estimated solely for purposes of calculating the registration fee in
    accordance with Rules 457(a) and 457(f) under the Securities Act.


(2) Previously paid.



(3) Pursuant to Rule 457(n) under the Securities Act, no separate fee is payable
    for the guarantees of the notes being registered.



    THE REGISTRANTS HEREBY AMEND THE REGISTRATION STATEMENT TO WHICH THIS
AMENDMENT RELATES ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS
EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE A FURTHER AMENDMENT WHICH
SPECIFICALLY STATES THAT THE REGISTRATION STATEMENT SHALL THEREAFTER BECOME
EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OR UNTIL THE
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.


- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------


                        TABLE OF ADDITIONAL REGISTRANTS




                                      JURISDICTION OF      IRS EMPLOYER
EXACT NAME OF ADDITIONAL REGISTRANT*     FORMATION      IDENTIFICATION NO.     PRINCIPAL EXECUTIVE OFFICE
- ------------------------------------  ---------------   ------------------     --------------------------
                                                                    
1329507 ONTARIO INC. ............       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

3D SEA II LTD. ..................       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

924689 ONTARIO INC. .............       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

DAVID KEIGHLEY PRODUCTIONS 70MM
  INC. ..........................      Delaware           95-3996963         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX (TITANIC) INC. .............      Delaware           98-0123185         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX (TITANICA) LTD. ............       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

IMAX CHICAGO THEATRE LLC.........      Delaware           82-0565362         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX FILM HOLDING CO. ...........      Delaware               --             110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX FORUM RIDE, INC. ...........       Nevada            88-0360462         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX II U.S.A. INC. .............      Delaware           51-0373323         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX INDIANAPOLIS LLC............       Indiana               --             110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX MINNESOTA HOLDING CO. ......      Delaware           52-2254901         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX MUSIC LTD. .................       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500







                                      JURISDICTION OF      IRS EMPLOYER
EXACT NAME OF ADDITIONAL REGISTRANT*     FORMATION      IDENTIFICATION NO.     PRINCIPAL EXECUTIVE OFFICE
- ------------------------------------  ---------------   ------------------     --------------------------
                                                                    
IMAX PICTURES CORPORATION........      Delaware           98-0153647         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX PROVIDENCE GENERAL PARTNER
  CO. ...........................      Delaware           52-2054994         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX PROVIDENCE LIMITED PARTNER
  CO. ...........................      Delaware           52-2054995         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX RHODE ISLAND LIMITED
  PARTNERSHIP....................     Rhode Island        98-0176677         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX SANDDE ANIMATION INC. ......       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500


IMAX SCRIBE INC. ................      Delaware           51-0373325         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


IMAX SPACE LTD. .................       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

IMAX THEATRE HOLDING (BROSSARD)
  INC. ..........................       Canada                --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

IMAX THEATRE HOLDING (CALIFORNIA I)
  CO. ...........................      Delaware           52-2054998         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE HOLDING (CALIFORNIA II)
  CO. ...........................      Delaware           52-2054999         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE HOLDING (NYACK I)
  CO. ...........................      Delaware           52-2055001         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE HOLDING (NYACK II)
  CO. ...........................      Delaware           52-2055002         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE HOLDING CO. ........      Delaware           52-2054997         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100






                                      JURISDICTION OF      IRS EMPLOYER
EXACT NAME OF ADDITIONAL REGISTRANT*     FORMATION      IDENTIFICATION NO.     PRINCIPAL EXECUTIVE OFFICE
- ------------------------------------  ---------------   ------------------     --------------------------
                                                                    
IMAX THEATRE HOLDINGS (OEI) INC. ...   Delaware           52-2054993         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE MANAGEMENT
  (SCOTTSDALE), INC. ............       Arizona           86-0686026         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE MANAGEMENT COMPANY..      Delaware           52-2054996         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMAX THEATRE SERVICES LTD. ......       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500


IMAX U.S.A. INC. ................      Delaware           98-0159490         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100

IMMERSIVE ENTERTAINMENT INC. ....      Delaware           98-0153646         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


MIAMI THEATRE LLC ...............      Delaware           65-0888857         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


MITEY CINEMA INC. ...............       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

MOUNTAINVIEW THEATRE MANAGEMENT
  LTD. ..........................       Alberta               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500


NYACK THEATRE LLC ...............      New York           98-0202278         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


PANDA PRODUCTIONS INC. ..........      Delaware           95-4785483         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


RIDEFILM CORPORATION.............      Delaware           04-3222960         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


RPM PICTURES LTD. ...............       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500







                                      JURISDICTION OF      IRS EMPLOYER
EXACT NAME OF ADDITIONAL REGISTRANT*     FORMATION      IDENTIFICATION NO.     PRINCIPAL EXECUTIVE OFFICE
- ------------------------------------  ---------------   ------------------     --------------------------
                                                                    
SACRAMENTO THEATRE LLC ..........      Delaware           68-0432572         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


SONICS ASSOCIATES, INC. .........       Alabama           63-0623302         110 E. 59th Street, Suite 2100
                                                                             New York, New York 10022 phone:
                                                                                     (212) 821-0100

STARBOARD THEATRES LTD. .........       Canada                --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

STRATEGIC SPONSORSHIP CORPORATION...   Delaware           52-1723753         110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


TANTUS FILMS LTD. ...............       Canada                --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500


TANTUS II FILMS LTD. ............       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500

TAURUS-LITTROW PRODUCTIONS INC. ...    Delaware               --             110 E. 59th Street, Suite 2100
                                                                                New York, New York 10022
                                                                                  phone: (212) 821-0100


WIRE FRAME FILMS LTD. ...........       Ontario               --                  2525 Speakman Drive,
                                                                              Mississauga, Ontario L5K 1B1
                                                                                  phone: (905) 403-6500



- ---------------

* The address and telephone number of the agent for service in the United States
  of each of the additional registrants is c/o IMAX U.S.A. Inc., 110 E. 59th
  Street, Suite 2100, New York, New York 10022, phone: (212) 821-0100,
  attention: Robert D. Lister. The primary standard industrial classification
  numbers for the additional registrants are 3861, 7822 and 7830.


                                     PART I

                     INFORMATION REQUIRED IN THE PROSPECTUS

                                       I-1


THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT EXCHANGE THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE NOTES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE NOTES IN ANY
STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.


                    SUBJECT TO COMPLETION, DATED MAY 6, 2004


PROSPECTUS

                                  (IMAX LOGO)

         OFFER TO EXCHANGE ALL OUTSTANDING 9 5/8% SENIOR NOTES DUE 2010
                         ISSUED ON DECEMBER 4, 2003 FOR
                UP TO $160,000,000 AGGREGATE PRINCIPAL AMOUNT OF
                    REGISTERED 9 5/8% SENIOR NOTES DUE 2010

THE OLD NOTES:


     $160,000,000 aggregate principal amount of 9 5/8% Senior Notes due December
1, 2010, referred to in this prospectus as the old notes, were originally issued
and sold by IMAX Corporation on December 4, 2003 in a transaction that was
exempt from registration under the Securities Act of 1933, as amended, and
resold to qualified institutional buyers in compliance with Rule 144A. The
payment of principal, premium, if any, and interest on the old notes is fully
and unconditionally guaranteed, jointly and severally, by each of our current
and future North American subsidiaries. The guarantees are general unsecured
obligations of the guarantors and are equal in right of payment with any future
unsecured, unsubordinated indebtedness of the guarantors.


THE NEW NOTES:


     The terms of the new notes, referred to in this prospectus as the notes,
are substantially identical to the terms of the old notes, and evidence the same
indebtedness as the old notes, except that the notes will be registered under
the Securities Act, will not contain restrictions on transfer or provisions
relating to special interest under circumstances related to the timing of the
exchange offer, will bear a different CUSIP number from the old notes and will
not entitle their holders to registration rights. The payment of principal,
premium, if any, and interest on the notes will be fully and unconditionally
guaranteed, jointly and severally, by each of our current and future North
American subsidiaries on the same terms as the guarantees in respect of the old
notes.



     SEE "RISK FACTORS" BEGINNING ON PAGE 13 FOR A DISCUSSION OF CERTAIN RISKS
THAT YOU SHOULD CONSIDER IN CONNECTION WITH TENDERING YOUR OLD NOTES IN THE
EXCHANGE OFFER.


EXCHANGE OFFER:

     Our offer to exchange old notes for notes will be open until 5:00 p.m., New
York City time, on           , 2004, unless we extend the offer.

     Notes will be issued in exchange for an equal principal amount of
outstanding old notes accepted in the exchange offer. The exchange offer is not
conditioned upon any minimum principal amount of old notes being tendered for
exchange. However, the obligation to accept old notes for exchange pursuant to
the exchange offer is subject to certain customary conditions set forth herein.
See "The Exchange Offer -- Conditions."

     No public market currently exists for the notes and we do not intend to
apply for their listing on any securities exchange or to arrange for them to be
quoted on any quotation system.

     Each broker-dealer that receives notes for its own account pursuant to the
exchange offer must acknowledge that it will deliver a prospectus in connection
with any resale of such notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of notes received in exchange for old notes where the old notes
were acquired as a result of market-making activities or other trading
activities. We have agreed that, for a period of 180 days after the expiration
date of the exchange offer, we will make this prospectus, as amended or
supplemented, available to any broker-dealer for use in connection with any such
resale. See "Plan of Distribution."
                             ---------------------
     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE NOTES OR PASSED UPON THE ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
                The date of this prospectus is           , 2004.


                               ------------------

                               TABLE OF CONTENTS




                                         PAGE
                                         ----
                                      
SUMMARY................................    1
RISK FACTORS...........................   13
SPECIAL NOTE REGARDING FORWARD-LOOKING
  INFORMATION..........................   25
USE OF PROCEEDS........................   26
CAPITALIZATION.........................   27
SELECTED CONSOLIDATED FINANCIAL
  INFORMATION..........................   28
BUSINESS...............................   32
MANAGEMENT.............................   41
THE EXCHANGE OFFER.....................   44






                                         PAGE
                                         ----
                                      
DESCRIPTION OF NEW CREDIT FACILITY.....   51
DESCRIPTION OF THE NOTES...............   52
BOOK-ENTRY, DELIVERY AND FORM..........   79
CERTAIN FEDERAL INCOME TAX
  CONSIDERATIONS.......................   83
PLAN OF DISTRIBUTION...................   85
LEGAL MATTERS..........................   85
EXPERTS................................   85
WHERE YOU CAN FIND MORE
  INFORMATION..........................   86



                               ------------------

     YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE INTO THIS DOCUMENT OR TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT
AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT. THIS
DOCUMENT MAY ONLY BE USED WHERE IT IS LEGAL TO SELL THESE SECURITIES. THE
INFORMATION IN THIS DOCUMENT AND THE DOCUMENTS INCORPORATED BY REFERENCE MAY
ONLY BE ACCURATE ON THE DATE OF SUCH DOCUMENTS.

     THIS PROSPECTUS INCORPORATES BY REFERENCE DOCUMENTS THAT CONTAIN IMPORTANT
BUSINESS AND FINANCIAL INFORMATION ABOUT THE COMPANY THAT IS NOT INCLUDED OR
DELIVERED WITH THIS PROSPECTUS. THESE DOCUMENTS ARE AVAILABLE WITHOUT CHARGE TO
HOLDERS OF THE NOTES UPON WRITTEN OR ORAL REQUEST TO IMAX CORPORATION AT THE
ADDRESS AND PHONE NUMBER SPECIFIED UNDER "WHERE YOU CAN FIND MORE INFORMATION."
TO OBTAIN TIMELY DELIVERY, HOLDERS OF THE NOTES MUST REQUEST THESE DOCUMENTS NO
LATER THAN FIVE BUSINESS DAYS BEFORE THE EXPIRATION DATE. UNLESS EXTENDED, THE
EXPIRATION DATE IS           , 2004.

                               ------------------

     Unless the context requires otherwise or otherwise as expressly stated, the
terms "IMAX," "we," "our," "us," and the "company" refer to IMAX Corporation
and, unless the context otherwise requires or otherwise as expressly stated, its
consolidated subsidiaries. Unless otherwise indicated, all references to "$" or
"US$" are to United States dollars.

                               ------------------

                                        i


                                    SUMMARY

     The following summary highlights selected information contained elsewhere
in, or incorporated by reference into, this prospectus and does not contain all
of the information that you should consider before exchanging your old notes for
the notes. You should read this summary together with the more detailed
information that is contained in, or incorporated by reference into, this
prospectus, including the risk factors, financial data and financial statements
and notes thereto. In this prospectus, the terms "IMAX," "we," "our," "us" and
the "company" refer to IMAX Corporation and, unless the context otherwise
requires or otherwise expressly stated, its consolidated subsidiaries.

                                IMAX CORPORATION


     We are one of the world's leading entertainment technology companies,
specializing in large-format and three-dimensional, or 3D, film presentations.
Our theatre systems use 15 perforation, 70mm, or 15/70 film, the largest
commercially available film format, which allows IMAX theatres to present
stunning images of exceptional quality and clarity on screens up to one-hundred
feet wide and eight stories tall. These images fill a viewer's peripheral vision
and, together with our proprietary 6-channel digital sound systems and unique
theatre designs, create "The IMAX Experience," which makes audiences feel as if
they are "in the movie." IMAX films have taken viewers to the bottom of the
ocean, in space to the International Space Station and, most recently, inside
some of Hollywood's most exciting blockbuster movies such as Star Wars Episode
II: Attack of the Clones, The Matrix Reloaded and The Matrix Revolutions. The
IMAX brand is world famous and stands for the highest-quality, most immersive
filmed entertainment. It is one of our most valuable assets and it attracts
audiences to IMAX theatres, thereby increasing demand for leases of our theatre
systems. We generate the majority of our revenue through upfront and recurring
payments received in connection with the leasing of our theatre systems to third
party operators. We generally do not own IMAX theatres. For the year ended
December 31, 2003, we generated revenue of $119.3 million, earnings from
operations of $18.1 million and net earnings from continuing operations of $0.2
million.



     IMAX created the large-format theatre industry more than 35 years ago. We
estimate that IMAX theatres represent a significant majority of the large-format
theatres in operation and almost all of 15/70 theatres in operation. At December
31, 2003, there were 240 IMAX theatre systems operating in more than 35
countries. For the year ended December 31, 2003, IMAX systems revenue from these
theatres totaled $75.8 million. Our sales backlog, which represented contracts
for 61 theatre systems, totaled $138.1 million at December 31, 2003. We are also
a producer and distributor of large-format films and the largest provider of
large-format post-production services. In addition, we engage in other related
businesses, including renting camera equipment for large-format film production
and owning and operating seven IMAX theatres.


     IMAX theatres are found in some of the most prestigious educational
institutions and destination entertainment centers in the world. However, we
believe that commercial markets, including multiplex theatres and entertainment
destinations, offer the greatest potential for growth of the IMAX network. We
believe that our expansion into these markets will result from the favorable
economics that IMAX theatres can provide to commercial theatre-owners and
filmmakers. These economics have been enhanced by two recent developments:

     - IMAX DMR, our new proprietary film conversion technology, which allows us
       to digitally re-master virtually any 35mm live-action film into our 15/70
       film format at a cost of approximately $2 million to $4 million per film
       and gives us the ability to benefit from Hollywood event film releases
       and their large marketing budgets.

     - IMAX MPX, our new theatre projection system designed specifically for use
       in multiplex auditoriums, which reduces the capital and operating costs
       required to run an IMAX theatre, while still offering consumers the image
       and sound quality of The IMAX Experience.

                                        1



                              RECENT DEVELOPMENTS


  REDEMPTION AND REPURCHASE OF 7 7/8% SENIOR NOTES DUE 2005

     In December 2003, we concluded a tender offer and consent solicitation for
$152.8 million outstanding principal amount of our 7 7/8% senior notes due 2005
in which we purchased approximately $123.6 million of such senior notes. On
January 2, 2004, we redeemed all the senior notes not acquired in the tender
offer pursuant to the optional redemption provisions of the senior notes. The
net proceeds from the offering of the old notes, together with cash on hand, was
used to fund the purchase and redemption of the 7 7/8% senior notes due 2005.

  NEW CREDIT FACILITY


     On February 6, 2004, we entered into a new $20.0 million credit facility
which is secured by all of the assets of IMAX Corporation and certain of its
subsidiaries. Amounts borrowed under this credit facility will constitute
secured indebtedness and will effectively rank senior to the notes to the extent
of the value of the assets securing such indebtedness. See "Description of New
Credit Facility."


                               ------------------

     IMAX Corporation is organized under the Canada Business Corporations Act.
Our head and principal office address is 2525 Speakman Drive, Mississauga,
Ontario, Canada L5K 1B1. Our telephone number is (905) 403-6500.

     IMAX(R), IMAX(R) Dome, IMAX(R) 3D, IMAX (R) 3D Dome, The IMAX
Experience(R), An IMAX Experience(R), IMAX(R) DMR(R), IMAX(R) MPX(TM), IMAX
Think Big (TM) and Think Big(TM) are our most significant trademarks and trade
names that are registered or otherwise protected under laws of various
jurisdictions. We also own the service mark IMAX Theatre(TM).

                                        2


                               THE EXCHANGE OFFER

     On December 4, 2003, IMAX Corporation completed a private placement of
$160,000,000 principal amount of 9 5/8% Senior Notes due 2010 to a group of
initial purchasers. In this prospectus, we refer to (1) the notes sold in that
original offering as the old notes and (2) the notes offered in this prospectus
in exchange for the old notes as the notes.

Exchange Offer................   You may exchange old notes for notes.

Terms of Notes................   The terms of the notes are substantially
                                 identical to the terms of the old notes, and
                                 evidence the same indebtedness as the old
                                 notes, except that the notes:

                                      - will be registered under the Securities
                                        Act, and, consequently, will be freely
                                        tradeable by persons not affiliated with
                                        us;

                                      - will not bear any legend restricting
                                        transfer under the Securities Act;

                                      - will not be entitled to the rights which
                                        are applicable to the old notes under
                                        the registration rights agreement;

                                      - will not contain provisions relating to
                                        the payment of special interest under
                                        circumstances related to the timing of
                                        the exchange offer; and

                                      - will bear a different CUSIP number from
                                        the old notes.

                                 See "Description of the Notes."

Resale of Notes...............   We believe you may offer the notes for resale,
                                 resell and otherwise transfer them without
                                 compliance with the registration or prospectus
                                 delivery provisions of the Securities Act if:

                                      - you are acquiring the notes in the
                                        ordinary course of your business;

                                      - you are not participating or engaged in,
                                        do not intend to participate or engage
                                        in, and have no arrangement or
                                        understanding with any person to
                                        participate in, the distribution of the
                                        notes issued to you; and

                                      - you are not a broker-dealer or an
                                        "affiliate" of ours within the meaning
                                        of Rule 405 under the Securities Act.

                                 You should read the discussion under the
                                 heading "The Exchange Offer" for further
                                 information regarding the exchange offer and
                                 resale of the notes.

Registration Rights
Agreement.....................   We have undertaken this exchange offer pursuant
                                 to the terms of a registration rights agreement
                                 entered into with the initial purchasers of the
                                 old notes. See "The Exchange Offer."

Consequences of Failure to
Exchange Old Notes............   You will continue to hold old notes that remain
                                 subject to their existing transfer restrictions
                                 if:

                                      - you do not tender your old notes; or

                                      - you tender your old notes and they are
                                        not accepted for exchange.
                                        3



                                 Subject to certain limited exceptions, we will
                                 have no obligation to register the old notes
                                 after we consummate the exchange offer. See
                                 "The Exchange Offer -- Terms of the Exchange
                                 Offer" and " -- Consequences of Failure to
                                 Exchange." Following the exchange offer, the
                                 transfer restrictions that apply to unexchanged
                                 old notes and the availability of registered
                                 new notes, will likely cause the market for the
                                 unexchanged old notes to be much less liquid
                                 than before the exchange offer.


Expiration Date...............   The "expiration date" for the exchange offer is
                                 5:00 p.m., New York City time, on           ,
                                 2004, unless we extend it, in which case
                                 "expiration date" means the latest date and
                                 time to which the exchange offer is extended.

Accrued Interest on the Notes
and the Old Notes.............   The notes will bear interest from the most
                                 recent date to which interest has been paid on
                                 the old notes or, if no interest has been paid
                                 on the old notes, from December 4, 2003.

Conditions to the Exchange
Offer.........................   The exchange offer is subject to certain
                                 customary conditions which we may waive. See
                                 "The Exchange Offer -- Conditions."

Procedures for Tendering Old
Notes.........................   If you wish to exchange your old notes for
                                 notes pursuant to the exchange offer, you must
                                 submit the required documentation and effect a
                                 tender of old notes pursuant to the procedures
                                 for book-entry transfer (or other applicable
                                 procedures) all in accordance with the
                                 instructions described in this prospectus and
                                 in the relevant letter of transmittal. See "The
                                 Exchange Offer -- Procedures for Tendering,"
                                 "-- Book-Entry Transfer," "-- Exchanging
                                 Book-Entry Notes" and "-- Guaranteed Delivery
                                 Procedures."

Special Procedures for
Beneficial Owners.............   If you own a beneficial interest in old notes
                                 that are registered in the name of a broker,
                                 dealer, commercial bank, trust company or other
                                 nominee or custodian, and you wish to tender
                                 your old notes in the exchange offer, you
                                 should contact the registered holder as soon as
                                 possible and instruct the registered holder to
                                 tender on your behalf.

Guaranteed Delivery
Procedures....................   If you wish to tender your old notes, but
                                 cannot properly do so prior to the expiration
                                 date, you may tender your old notes according
                                 to the guaranteed delivery procedures described
                                 in "The Exchange Offer -- Guaranteed Delivery
                                 Procedures."

Withdrawal Rights.............   Tenders of old notes may be withdrawn at any
                                 time prior to 5:00 p.m., New York City time, on
                                 the expiration date. To withdraw a tender of
                                 old notes, a written or facsimile transmission
                                 notice of withdrawal must be received by the
                                 exchange agent at its address set forth in the
                                 letter of transmittal prior to 5:00 p.m., New
                                 York City time, on the expiration date. See
                                 "The Exchange Offer -- Withdrawal Rights."

Acceptance of Old Notes and
Delivery of Notes.............   Subject to certain conditions, any and all old
                                 notes that are validly tendered in the exchange
                                 offer prior to 5:00 p.m., New York City time,
                                 on the expiration date will be accepted for
                                        4


                                 exchange. The notes issued pursuant to the
                                 exchange offer will be delivered as promptly as
                                 practicable after the expiration date. See "The
                                 Exchange Offer -- Terms of the Exchange Offer."

Certain U.S. Federal Income
Tax Considerations............   We believe that the exchange of the old notes
                                 for notes should not constitute a taxable
                                 exchange for U.S. federal income tax purposes.
                                 See "Certain Federal Income Tax
                                 Considerations -- U.S. Federal Income Tax
                                 Considerations." You should consult your own
                                 tax advisor to determine the tax consequences
                                 of your decision to participate in the exchange
                                 offer.

Certain Canadian Federal
Income Tax Considerations.....   Holders will not be subject to tax under the
                                 Income Tax Act (Canada) on the exchange of old
                                 notes for notes. See "Certain Federal Income
                                 Tax Considerations -- Canadian Federal Income
                                 Tax Considerations." You should consult your
                                 own tax advisor to determine the tax
                                 consequences of your decision to participate in
                                 the exchange offer.

Use of Proceeds...............   We will not receive any cash proceeds from the
                                 issuance of the notes in the exchange offer.
                                 See "Use of Proceeds."

Exchange Agent................   U.S. Bank National Association is serving as
                                 the exchange agent.

                                   THE NOTES

     The summary below describes the principal terms of the notes. Some of the
terms and conditions below are subject to important limitations and exceptions.
The "Description of the Notes" section of the prospectus contains a more
detailed description of the terms and conditions of the notes.

Issuer........................   IMAX Corporation


Notes Offered.................   $160.0 million aggregate principal amount of
                                 9 5/8% Senior Notes due 2010. The indenture
                                 governing the issuance of the notes provides
                                 for the issuance of an unlimited aggregate
                                 principal amount of additional notes having
                                 identical terms and conditions to the notes
                                 offered hereby, subject to compliance with the
                                 covenant restricting the incurrence of
                                 additional indebtedness.


Maturity Date.................   December 1, 2010.

Interest Rate and Payment
Dates.........................   Interest on the notes will accrue at the rate
                                 of 9 5/8% per annum, payable semiannually in
                                 cash in arrears on each June 1 and December 1,
                                 commencing on June 1, 2004.


Subsidiary Guarantees.........   The payment of principal, premium, if any, and
                                 interest on the notes will be fully and
                                 unconditionally guaranteed, jointly and
                                 severally, by each of our current and future
                                 North American subsidiaries. See "Description
                                 of the Notes -- Note Guarantees."



Optional Redemption...........   On or after December 1, 2007, we may redeem the
                                 notes at the following redemption prices
                                 (expressed as percentages of the principal
                                 amount) if redeemed during the 12-month period


                                        5



                                 commencing December 1 of the years indicated
                                 below, together with accrued and unpaid
                                 interest thereon to the redemption date:





                                          YEAR                                             PERCENTAGE
                                          ----                                             ----------
                                                                                        
                                          2007.........................................     104.813%
                                          2008.........................................     102.406%
                                          2009 and thereafter..........................     100.000%




                                 See "Description of the Notes -- Optional
                                 Redemption." Prior to December 1, 2006, we may
                                 redeem up to 35% of the notes with the proceeds
                                 of certain equity offerings at 109.625% of the
                                 principal amount, together with accrued and
                                 unpaid interest thereon to the redemption date.


Change of Control.............   If we experience a change of control, we will
                                 be required to make an offer to repurchase the
                                 notes at a purchase price of 101% of the
                                 principal amount of the notes, plus accrued and
                                 unpaid interest to the date of the repurchase.
                                 See "Description of the Notes -- Certain
                                 Covenants -- Offer to Repurchase Notes Upon a
                                 Change of Control."

Additional Amounts............   All payments made by or on behalf of IMAX with
                                 respect to the notes will be made without
                                 withholding or deduction for Canadian taxes
                                 unless required by law. If we are required by
                                 law to withhold or deduct for Canadian taxes
                                 with respect to a payment to the holders of
                                 notes, we will pay the additional amounts
                                 necessary so that the net amount received by
                                 the holders of notes after the withholding is
                                 not less than the amount that they would have
                                 received in the absence of the withholding. See
                                 "Description of the Notes -- Additional
                                 Amounts."

Tax Redemption................   We may also redeem the notes, in whole but not
                                 in part, at any time at 100% of the principal
                                 amount of the notes plus accrued and unpaid
                                 interest, if any, to the date of redemption in
                                 the event of changes affecting Canadian
                                 withholding taxes that would require us to pay
                                 additional amounts to holders of the notes. See
                                 "Description of the Notes -- Optional
                                 Redemption."

Ranking.......................   The notes will be unsecured obligations. The
                                 notes will rank:


                                 - equally with any existing and future senior
                                   indebtedness of IMAX Corporation (including
                                   any unexchanged old notes);



                                 - effectively junior to secured indebtedness,
                                   including borrowings under our new credit
                                   facility, to the extent of the value of the
                                   assets securing such indebtedness;



                                 - senior to all existing and future
                                   subordinated indebtedness of IMAX
                                   Corporation; and



                                 - effectively subordinated to all existing and
                                   future indebtedness and other liabilities of
                                   our subsidiaries that have not guaranteed the
                                   notes.



                                 As at December 31, 2003, IMAX had approximately
                                 $189.2 million of outstanding senior
                                 indebtedness, consisting of $160.0 million of
                                 outstanding old notes and $29.2 million of
                                 outstanding 7 7/8% senior notes due 2005 (which
                                 were redeemed on January 2, 2004). As at
                                 December 31, 2003, excluding


                                        6



                                 intercompany liabilities, our subsidiaries that
                                 are not guarantors of the notes had
                                 approximately $0.4 million of outstanding
                                 indebtedness and other liabilities, as to which
                                 the notes would have been effectively
                                 subordinated.



                                 The guarantees of the notes will be unsecured
                                 obligations. The guarantees will rank:



                                 -  equally with any existing and future senior
                                    indebtedness of the subsidiary guarantors;



                                 -  effectively junior to secured indebtedness
                                    of the subsidiary guarantors, including
                                    guarantees issued under IMAX's new credit
                                    facility, to the extent of the value of the
                                    assets securing such indebtedness; and



                                 -  senior to all existing and future
                                    subordinated indebtedness of the subsidiary
                                    guarantors.



                                 As of December 31, 2003, the subsidiary
                                 guarantors had no outstanding debt other than
                                 the guarantees of the old notes.



                                 Subject to compliance with the covenants
                                 regarding additional indebtedness and liens,
                                 IMAX and its subsidiaries have the ability to
                                 incur, assume or acquire indebtedness which
                                 would be effectively senior to the notes to the
                                 extent of the assets securing such
                                 indebtedness. See "Description of the
                                 Notes -- Certain Covenants -- Limitation on
                                 Incurrence of Additional Indebtedness" and
                                 "-- Limitation on Liens Securing Indebtedness."



Covenants.....................   We will issue the notes under an indenture with
                                 U.S. Bank National Association, as trustee. The
                                 indenture governing the notes, among other
                                 things, restricts our ability to:


                                 - incur additional indebtedness;

                                 - make distributions or certain other
                                   restricted payments;

                                 - grant liens;

                                 - create dividend and other payment
                                   restrictions affecting our subsidiaries;

                                 - sell certain assets or merge with or into
                                   other companies; and

                                 - enter into transactions with affiliates.

                                 For more details, see "Description of the
                                 Notes -- Certain Covenants."

Absence of an Established
Market for the Notes..........   The old notes are not presently listed on any
                                 securities exchange nor are they quoted on any
                                 quotation system. The notes are a new issue of
                                 securities, and currently there is no market
                                 for them. We do not intend to apply for the
                                 notes to be listed on any securities exchange
                                 or to arrange for any quotation system to quote
                                 them. The initial purchasers have advised us
                                 that they intend to make a market for the
                                 notes, but they are not obligated to do so. The
                                 initial purchasers may discontinue any
                                 market-making in the notes or any exchange
                                 notes at any time in their sole discretion.
                                 Accordingly, we cannot assure you that a liquid
                                 market will develop for the notes.

                                        7


                                  RISK FACTORS


     OWNING THE NOTES INVOLVES RISKS.  YOU SHOULD REFER TO THE SECTION ENTITLED
"RISK FACTORS" ON PAGE 13 OF THIS PROSPECTUS FOR AN EXPLANATION OF THE MATERIAL
RISKS BEFORE TENDERING YOUR OLD NOTES IN THE EXCHANGE OFFER.


                                        8


                   SUMMARY CONSOLIDATED FINANCIAL INFORMATION


     The following table sets forth certain summary consolidated financial
information derived from our audited consolidated financial statements for the
years ended December 31, 2001, 2002 and 2003, all of which were prepared in
accordance with United States generally accepted accounting principles.


     You should read the following information in conjunction with the section
in our quarterly and annual reports entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations," the audited
consolidated financial statements and the related notes and the unaudited
interim consolidated financial statements and the related notes, all
incorporated by reference in this prospectus.




                                                                      YEARS ENDED DECEMBER 31,
                                                               ---------------------------------------
                                                                   2001          2002          2003
                                                               ------------   -----------   ----------
                                                                (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                                                   
STATEMENTS OF OPERATIONS DATA:
REVENUE
  IMAX systems(1)...........................................    $  76,582      $ 70,959      $75,848
  Films.....................................................       29,923        40,556       25,803
  Theater operations........................................        6,540        12,284       13,109
  Other.....................................................        4,654         5,303        4,500
                                                                ---------      --------      -------
  Total revenue.............................................      117,699       129,102      119,260
Costs of goods and services(2)..............................       94,969        75,634       67,283
                                                                ---------      --------      -------
Gross margin................................................       22,730        53,468       51,977
Selling, general and administrative expenses(3).............       45,850        34,906       33,312
Research and development....................................        3,385         2,362        3,794
Amortization of intangibles(4)..............................        3,005         1,418          573
Income from equity-accounted investees(5)...................          (73)         (283)      (2,496)
Receivable provisions (recoveries), net.....................       18,102        (1,233)      (2,225)
Restructuring costs and asset impairments (recoveries)(6)...       45,269          (121)         969
                                                                ---------      --------      -------
Earnings (loss) from operations(1)..........................      (92,808)       16,419       18,050
Interest income.............................................          847           413          656
Interest expense............................................      (22,020)      (17,564)     (15,856)
Gain (loss) on retirement of notes(7).......................       55,577        11,900       (4,910)
Recovery on (impairment of) long-term investments(8)........       (5,584)           --        1,892
                                                                ---------      --------      -------
Earnings (loss) from continuing operations before income
  taxes.....................................................      (63,988)       11,168         (168)
Recovery of (provision for) income taxes(9).................      (27,848)           --          386
                                                                ---------      --------      -------
Net earnings (loss) from continuing operations..............      (91,836)       11,168          218
Net earnings (loss) from discontinued operations(10)........      (53,278)          804          195
Net earnings (loss) before cumulative effect of changes in
  accounting principles.....................................     (145,114)       11,972          413
Cumulative effect of changes in accounting principles(11)...           --            --         (182)
                                                                ---------      --------      -------
Net earnings (loss).........................................    $(145,114)     $ 11,972          231
                                                                =========      ========      =======
Basic net earnings (loss) from continuing operations per
  common share..............................................    $   (2.97)     $   0.34      $  0.01
Diluted net earnings (loss) from continuing operations per
  common share..............................................    $   (2.97)     $   0.34      $  0.01



                                        9





                                                                  YEARS ENDED DECEMBER 31,
                                                              ---------------------------------
                                                                 2001        2002        2003
                                                              ----------   ---------   --------
                                                              (IN THOUSANDS, EXCEPT SYSTEMS AND
                                                                         RATIO DATA)
                                                                              
OTHER DATA:
Total systems signed(12):
  North America.............................................          5           7          9
  International.............................................          7          14         16
New systems installed:
  North America.............................................          8           6         13
  International.............................................          7          10          7
Total systems in operation (period end).....................        227         232        240
Capital expenditures........................................  $   9,373    $  3,958    $ 4,553
Ratio of earnings to fixed charges(13)......................         --        1.58x        --






                                                               AS AT DECEMBER 31, 2003
                                                              --------------------------
                                                               ACTUAL    AS ADJUSTED(14)
                                                              --------   ---------------
                                                                    (IN THOUSANDS)
                                                                   
BALANCE SHEETS DATA:
Cash and cash equivalents...................................  $ 47,282      $ 16,193
Restricted cash(15).........................................  $  4,961      $  4,961
Total assets................................................  $250,376      $219,078
Total long-term indebtedness................................  $189,234      $160,000



- ---------------


(1)  In the normal course of our business, we each year will have customers who,
     for a number of reasons including the inability to obtain certain consents,
     approvals or financing, are unable to proceed with theatre construction.
     Once the determination is made that the customer will not proceed with
     installation, the lease agreement with the customer is generally terminated
     by us. Upon the customer and the Company being released from our future
     obligations under the agreement, the initial lease payments that the
     customer previously made to us are recognized as revenue. Included in
     systems revenue is $5.5 million, $5.1 million and $9.6 million in 2001,
     2002 and 2003, respectively, for amounts recognized for restructured and/or
     terminated lease agreements.



(2)  Costs of goods and services during the year ended December 31, 2001
     included charges of $4.1 million and $16.5 million relating to a reduced
     realizable value of our inventories and reduced fair values of our film
     assets, respectively.


(3)  Selling, general and administrative expenses for the year ended December
     31, 2001 included a $2.6 million non-cash charge for incurred compensation
     resulting from a stock grant issuance.


(4)  Effective January 1, 2002, we adopted FASB Financial Accounting Standard
     No. 142, "Goodwill and other Intangibles" ("FAS 142"), under which goodwill
     and intangible assets with indefinite lives are no longer amortized but are
     reviewed at least annually for impairment. In accordance with FAS 142, the
     effect of this change in accounting principle is reflected prospectively.
     Included in amortization of intangibles is goodwill amortization of $2.3
     million for 2001.



(5)  In 2003, loss (income) from equity-accounted investees included a gain of
     $2.3 million from the release of a financial guarantee.



(6)  In 2001, restructuring costs and asset impairments (recoveries) included
     $16.3 million related to efforts to rationalize the business by reducing
     our overall corporate workforce and consolidation of our operations, which
     included relocating our sound-system facility to near Toronto, Canada. In
     the assessment of the assets, we recorded charges of $26.7 million of fixed
     assets, and $3.3 million of other assets.


                                        10



(7)  During the year ended December 31, 2001, we and one of our wholly-owned
     subsidiaries purchased and cancelled an aggregate of $70.4 million
     principal amount of our convertible subordinated notes for $13.7 million,
     consisting of $12.5 million in cash from the subsidiary and common shares
     issued by us valued at $1.2 million. We recorded a gain of $55.6 million in
     connection with this transaction. During 2002, we and one of our
     wholly-owned subsidiaries purchased and cancelled an additional aggregate
     of $20.5 million principal amount of our convertible subordinated notes for
     $8.1 million, consisting of $6.0 million in cash from the subsidiary and
     common shares issued by us valued at $2.1 million. We recorded a gain of
     $11.9 million in connection with this transaction. During 2003, we recorded
     a loss of $4.9 million related to costs associated with the repurchase,
     retirement and refinancing of $170.8 million of our 7 7/8% senior notes due
     2005.



(8)  Recovery on (impairment of) long-term investments represents charges of
     $5.6 million relating to the impairment of its long-term investments in
     Mainframe Entertainment, Inc. for the year ended December 31, 2001. In
     2003, as a result of the Company entering into a settlement agreement with
     Mainframe Entertainment, Inc., we recorded a recovery of $1.9 million.



(9)  In 2001, the recovery of (provision for) income taxes included a $41.2
     million increase in the valuation allowance to reflect uncertainty
     associated with realization of our deferred income tax asset.



(10) Net earnings (loss) from discontinued operations consists of our subsidiary
     Digital Projection International which was acquired in September 1999 and
     sold in December 2001 and the Company's owned and operated Miami theatre
     which was opened in 1999 and closed in December 2003.



(11) In 2003, the Company recorded a charge as a cumulative effect of change in
     accounting principle of $0.2 million in accordance with SFAS No. 143
     "Accounting for Asset Retirement Obligations" which addresses financial
     accounting and reporting for obligations associated with the retirement of
     tangible long-lived assets and the associated asset retirement costs.



(12) Represents the number of theatre systems which were the subject of sale or
     lease agreements (including joint ventures) we entered into in the periods
     indicated.



(13) For the purpose of computing the ratios of earnings to fixed charges,
     "earnings" consist of earnings (loss) from continuing operations before
     income taxes and minority interest, loss (income) from equity-accounted
     investees, capitalized interest, amortization of capitalized interest and
     fixed charges. "Fixed charges" consist of interest expense, amortization of
     expenses related to indebtedness (which are included in interest expense),
     capitalized interest and an estimate of the interest within rental expense,
     deemed to be one-third of rental expense. Due to losses we incurred, the
     ratio coverage in certain years is less than 1:1. We would have had to
     generate additional earnings of $62.7 million in 2001 and $2.6 million in
     2003 to achieve a ratio of 1:1 in those periods. This table shows how we
     calculate the ratio of earnings to fixed charges.


                                        11





                                                                     YEARS ENDED DECEMBER 31,
                                                                 ---------------------------------
                                                                   2001         2002        2003
                                                                 ---------    --------    --------
                                                                 (IN THOUSANDS EXCEPT RATIO DATA)
                                                                                 
   Earnings (loss) from continuing operations before income
     taxes.....................................................  $(63,988)    $11,168     $  (168)
   Loss (income) from equity-accounted investees...............       (73)       (283)     (2,496)
   Capitalized interest........................................      (511)         --          --
   Amortization of capitalized interest........................     1,853          26          26
                                                                 --------     -------     -------
                                                                  (62,719)     10,911      (2,638)
                                                                 --------     -------     -------
   Fixed Charges:
     Interest expense..........................................    22,020      17,564      15,856
     Capitalized interest......................................       511          --          --
     Estimate of the interest within rental expense............     1,711       1,168       1,321
                                                                 --------     -------     -------
     Total fixed charges.......................................    24,242      18,732      17,177
                                                                 --------     -------     -------
   Earnings....................................................  $(38,477)    $29,643     $14,539
                                                                 ========     =======     =======
   Ratio of earnings to fixed charges..........................        --        1.58x         --




(14) As adjusted to reflect the redemption of $29.2 million of outstanding
     7 7/8% senior notes due 2005 on January 2, 2004 and the application of net
     proceeds from the offering of old notes as described under "Use of
     Proceeds."



(15) Represents cash collateralized in support of our letters of credit.


                                        12


                                  RISK FACTORS


     Investing in the notes involves a high degree of risk. Before deciding
whether to exchange the old notes for notes, you should carefully consider the
following risks in addition to the other information in this prospectus and the
documents incorporated by reference. If any of the risks described below occurs,
our business, operating results and financial condition could be materially
adversely affected.


RISKS RELATED TO THE NOTES

  WE ARE HIGHLY LEVERAGED, AND THIS IMPAIRS OUR ABILITY TO OBTAIN FINANCING AND
  LIMITS CASH FLOW AVAILABLE FOR OUR OPERATIONS.


     We are highly leveraged. As at December 31, 2003, as adjusted to reflect
the retirement in October 2003 of an aggregate principal amount of $15.7 million
of our 7 7/8% senior notes due 2005, the offering of the old notes and the
purchase and redemption of our outstanding 7 7/8% senior notes due 2005, our
total long-term indebtedness would be $160.0 million. At December 31, 2003, our
shareholders' deficiency was $51.8 million. Our high leverage has important
possible consequences. It may:


     - make it more difficult for us to satisfy our financial obligations;

     - limit our ability to obtain additional financing for working capital,
       capital expenditures, acquisitions or general corporate purposes;

     - require us to dedicate all or a substantial portion of our cash flow from
       operations to the payment of principal and interest on our indebtedness,
       resulting in less cash available for our operations and other purposes;

     - limit our ability to rapidly adjust to changing market conditions; and

     - increase our vulnerability to downturns in our business or in general
       economic conditions.

     Our ability to satisfy our obligations and to reduce our total debt depends
on our future operating performance. Our future operating performance is subject
to many factors, including economic, financial and competitive factors, which
may be beyond our control. As a result, we may not be able to generate
sufficient cash flow, and future financings may not be available to provide
sufficient net proceeds, to meet these obligations or to execute our business
strategy successfully.

  WE MAY STILL BE ABLE TO INCUR MORE INDEBTEDNESS, WHICH COULD FURTHER
  EXACERBATE THE RISKS ASSOCIATED WITH OUR SUBSTANTIAL INDEBTEDNESS.


     We may be able to incur substantial additional indebtedness in the future.
For example, pursuant to the terms of the indenture governing the notes, we may
issue additional notes. In addition, we can borrow up to $20.0 million under our
new credit facility, subject to a borrowing base calculation which includes the
Company's financing receivables, and certain reserve requirements. Although the
indenture governing the notes and the agreement governing our new credit
facility contain restrictions on the incurrence of additional indebtedness, debt
incurred in compliance with these restrictions could be substantial, and to the
extent such indebtedness is secured, it will effectively rank senior to the
notes to the extent of the value of the assets securing such indebtedness. If
additional indebtedness is added to our current indebtedness levels, the related
risks that we face would be magnified. In addition, the indenture does not
prevent us from incurring obligations that do not constitute indebtedness such
as operating leases. See "Description of the Notes -- Certain
Covenants -- Limitation on Incurrence of Additional Indebtedness."


  WE MAY NOT GENERATE CASH FLOW SUFFICIENT TO SERVICE ALL OF OUR OBLIGATIONS,
  INCLUDING OUR OBLIGATIONS RELATED TO THE NOTES.

     Our ability to make payments on and to refinance our indebtedness,
including the notes, and to fund our operations, working capital and capital
expenditures, depends on our ability to generate cash in the future. Our cash
flow is subject to general economic, industry, financial, competitive,
operating, regulatory

                                        13


and other factors, many of which are beyond our control. Our business may not
generate cash flow in an amount sufficient to enable us to repay our
indebtedness, including the notes, or to fund our other liquidity needs. We may
need to refinance all or a portion of our indebtedness, including the notes, on
or before maturity. Our ability to refinance our indebtedness or obtain
additional financing will depend on, among other things:

     - our financial condition at the time;

     - restrictions in the indenture governing the notes; and

     - the condition of the market and industries in which we operate.

     As a result, we may not be able to refinance any of our indebtedness,
including the notes, on commercially reasonable terms, or at all. If we do not
generate sufficient cash flow from operations, and additional borrowings or
refinancings or proceeds of asset sales are not available to us, we may not have
sufficient cash to enable us to meet all of our obligations, including payments
on the notes.

  THE OLD NOTES ARE, AND THE NOTES WILL BE, UNSECURED AND EFFECTIVELY
  SUBORDINATED TO OUR SECURED INDEBTEDNESS AND THE LIABILITIES OF OUR
  SUBSIDIARIES THAT ARE NOT GUARANTORS OF THE NOTES.


     The old notes are, and the notes will be, our general unsecured
obligations, ranking effectively junior in right of payment to all our existing
and future secured debt to the extent of the collateral securing such debt. As
at December 31, 2003, after giving effect to the offering of the old notes and
the purchase and redemption of our 7 7/8% senior notes due 2005, we would have
had no secured debt outstanding. On February 6, 2004, we entered into a new
$20.0 million credit facility, which is secured by all of the assets of IMAX
Corporation and those of our subsidiaries IMAX U.S.A. Inc., IMAX II U.S.A. Inc.
and 1329507 Ontario Inc. In addition, the indenture governing the notes permits
the incurrence of additional debt, some of which may be secured debt.


     In the event that we are declared bankrupt, become insolvent or are
liquidated or reorganized, any secured indebtedness will be entitled to be paid
in full from our assets securing such indebtedness before any payment may be
made with respect to the notes. Holders of the notes will participate ratably in
our remaining assets with all holders of our unsecured indebtedness that is
deemed to rank equally with the notes, and potentially with all of the other
general creditors (including trade creditors), based upon the respective amounts
owed to each holder or creditor. In any of the foregoing circumstances, there
may be insufficient assets to pay amounts due on the notes. As a result, holders
of the notes may receive less, ratably, than holders of our secured
indebtedness.


     In addition, the old notes are, and the notes will also be, effectively
subordinated to any existing and future liabilities of our subsidiaries that are
not guarantors of the notes. As at December 31, 2003, such subsidiaries had $0.4
million of liabilities (excluding intercompany liabilities).


  THE AGREEMENTS GOVERNING OUR INDEBTEDNESS CONTAIN SIGNIFICANT RESTRICTIONS
  THAT LIMIT OUR OPERATING AND FINANCIAL FLEXIBILITY AND MAY AFFECT OUR ABILITY
  TO MAKE PAYMENTS ON THE NOTES.

     The indenture governing the notes and the agreement governing our new
credit facility contain covenants that, among other things, limit our ability
to:

     - incur additional indebtedness;

     - pay dividends and make distributions;

     - repurchase stock;

     - make certain investments;

     - transfer or sell assets;

     - create liens;

     - enter into transactions with affiliates;

     - issue or sell stock of subsidiaries;

                                        14


     - create dividend or other payment restrictions affecting restricted
       subsidiaries; and

     - merge, consolidate, amalgamate or sell all or substantially all of our
       assets to another person.

     These restrictions may limit our ability to execute our business strategy.
Moreover, if operating results fall below current levels, we may be unable to
comply with these covenants. If that occurs, our lenders, including you, could
accelerate our indebtedness. If our indebtedness is accelerated, we may not be
able to repay all of our indebtedness, in which case your notes may not be fully
repaid, if they are repaid at all.

  WE MAY BE UNABLE TO PURCHASE NOTES IN THE EVENT OF A CHANGE OF CONTROL.

     Upon the occurrence of a change of control, as defined in the indenture, we
will be required to make an offer to purchase notes at a price equal to 101% of
their principal amount, plus accrued and unpaid interest, if any, to the date of
purchase. We may not have sufficient funds to make the required offer to
purchase at the time of such event. Any future debt that we incur may also
contain restrictions on the purchase of the notes.


  WE HAVE THE ABILITY TO REDEEM THE NOTES PRIOR TO THEIR MATURITY.



     On or after December 1, 2007, we may redeem the notes at the redemption
prices specified under the heading "Description of the Notes -- Optional
Redemption," plus accrued and unpaid interest, if any, to the redemption date.
Prior to December 1, 2006, we may also redeem up to 35% of the notes with the
proceeds of certain equity offerings at 109.625% of the principal amount of the
notes to be redeemed, plus accrued and unpaid interest, if any, to the
redemption date. In addition, we may redeem the notes, in whole but not in part,
at any time at 100% of the principal amount of the notes plus accrued and unpaid
interest, if any, to the redemption date in the event of changes affecting
Canadian withholding taxes that would require us to pay additional amounts to
holders of the notes. The election to redeem the notes under any of these
circumstances is solely in our discretion. If we elect to redeem the notes prior
to their maturity, you will not have the option to retain your notes to maturity
and will not receive any further interest payments. You may not be able to find
an alternative investment with comparable terms to those of the notes.
Furthermore, any of the above redemptions could materially impact our cash
position.


  CERTAIN BANKRUPTCY AND INSOLVENCY LAWS MAY IMPAIR THE TRUSTEE'S ABILITY TO
  ENFORCE REMEDIES UNDER THE NOTES.

     We are incorporated under the laws of Canada, and substantially all of our
assets are located in Canada. Under bankruptcy laws in the United States, courts
typically have jurisdiction over a debtor's property, wherever located,
including property situated in other countries. There can be no assurance,
however, that courts outside the United States would recognize the U.S.
bankruptcy court's jurisdiction. Accordingly, difficulties may arise in
administering a U.S. bankruptcy case involving a Canadian debtor like us with
property located outside the United States, and any orders or judgments of a
bankruptcy court in the United States may not be enforceable in Canada against
us.

     The rights of the trustee to enforce remedies may be significantly impaired
by the restructuring provisions of applicable Canadian federal bankruptcy,
insolvency and other restructuring legislation if the benefit of such
legislation is sought with respect to us. For example, both the Bankruptcy and
Insolvency Act (Canada) and the Companies' Creditors Arrangement Act (Canada)
contain provisions enabling an "insolvent person" to obtain a stay of proceeding
as against its creditors and others and to prepare and file a proposal for
consideration by all or some of its creditors to be voted on by the various
classes of its creditors. Such a restructuring proposal, if accepted by the
requisite majorities of creditors and approved by the court, may be binding on
persons, such as holders of the notes, who may not otherwise be willing to
accept it. Moreover, this legislation permits, in certain circumstances, an
insolvent debtor to retain possession and administration of its property, even
though it may be in default under the applicable debt instrument.

                                        15


     The powers of the court under the Bankruptcy and Insolvency Act and
particularly under the Companies' Creditors Arrangement Act have been exercised
broadly to protect a restructuring entity from actions taken by creditors and
other parties. Accordingly, if we were to seek protection under such Canadian
insolvency legislation following commencement of or during such a proceeding,
payments under the notes may be discontinued, the trustee may be unable to
exercise its rights under the indenture and holders of the notes may not be
compensated for any delays in payments, if any, of principal and interest and
may have their claims under the notes compromised as part of a restructuring
proposal.

  APPLICABLE STATUTES ALLOW COURTS, UNDER SPECIFIC CIRCUMSTANCES, TO VOID THE
  GUARANTEES OF THE NOTES PROVIDED BY CERTAIN OF OUR SUBSIDIARIES.

     Our creditors or the creditors of one or more guarantors of the notes could
challenge the guarantees as fraudulent transfers, conveyances or preferences or
on other grounds under applicable U.S. federal or state law or applicable
Canadian federal or provincial law. While the relevant laws vary from one
jurisdiction to another, the entering into the guarantees by certain of our
subsidiaries could be found to be a fraudulent transfer, conveyance or
preference or otherwise void if a court were to determine that:

     - a guarantor delivered its guarantee with the intent to defeat, hinder,
       delay or defraud its existing or future creditors; or

     - the guarantor did not receive fair consideration for the delivery of the
       guarantee and the guarantor was insolvent at the time it delivered the
       guarantee; or

     - the guarantor was rendered insolvent by reason of the guarantee; or

     - the guarantor was engaged, or was about to engage, in a business or
       transaction for which its remaining assets constituted unreasonably small
       capital to carry on its business; or

     - the guarantor intended to incur, or believed it would incur, debts beyond
       its ability to pay the debts as they matured.

     To the extent a court voids a guarantee as a fraudulent transfer,
preference or conveyance or holds it unenforceable for any other reason, holders
of notes would cease to have any direct claim against the guarantor that
delivered a guarantee. If a court were to take this action, the guarantor's
assets would be applied first to satisfy the guarantor's liabilities, including
trade payables and preferred stock claims, if any, before any portion of its
assets could be distributed to us to be applied to the payment of the notes. We
cannot assure you that a guarantor's remaining assets would be sufficient to
satisfy the claims of the holders of notes relating to any voided portions of
the guarantees.

     In addition, the corporate statutes governing the guarantors of the notes
may also have provisions that serve to protect each guarantor's creditors from
impairment of its capital from financial assistance given to its corporate
insiders where there are reasonable grounds to believe that, as a consequence of
this financial assistance, the guarantor would be insolvent or the book value,
or in some cases the realizable value, of its assets would be less than the sum
of its liabilities and its issued and paid-up share capital. While the
applicable corporate laws may not generally prohibit financial assistance
transactions and a corporation is generally permitted flexibility in its
financial dealings, the applicable corporate laws may prohibit or restrict each
guarantor's ability to give financial assistance in certain circumstances.

  IF YOU DO NOT PROPERLY TENDER YOUR OLD NOTES, YOU WILL NOT RECEIVE NOTES IN
  THE EXCHANGE OFFER, AND YOU MAY NOT BE ABLE TO SELL YOUR OLD NOTES.

     We registered the notes, but not the old notes, under the Securities Act.
The old notes may not be offered or sold except pursuant to an exemption from
the registration requirements of the Securities Act and applicable state
securities laws or pursuant to an effective registration statement. We will
issue notes only in exchange for old notes that are timely received by the
exchange agent, together with all required documents, including a properly
completed and duly signed letter of transmittal. Therefore, you should

                                        16


allow sufficient time to ensure timely delivery of the old notes, and you should
carefully follow the instructions on how to tender your old notes.

     Neither we nor the exchange agent is required to tell you of any defects or
irregularities with respect to your tender of the old notes. If you do not
tender your old notes or if we do not accept your old notes because you did not
tender your old notes properly then, after we consummate the exchange offer, you
will continue to hold old notes that are subject to the existing transfer
restrictions. In general, you may not offer or sell the old notes unless they
are registered under the Securities Act or offered or sold in a transaction
exempt from, or not subject to, the registration requirements of the Securities
Act and applicable state securities laws.

     Although we may in the future seek to acquire unexchanged old notes in open
market or privately negotiated transactions, through subsequent exchange offers
or otherwise, we have no present plans and are not required to acquire any
unexchanged old notes or to file with the SEC a shelf registration statement to
permit resales of any unexchanged old notes. In addition, holders of old notes
other than the initial purchasers or holders who are prohibited by applicable
law or SEC policy from participating in the exchange offer or who may not resell
the notes acquired in the exchange offer without delivering a prospectus, will
not have any further registration rights and will not have the right to receive
special interest on their old notes.

  THE MARKET FOR THE OLD NOTES MAY BE SIGNIFICANTLY MORE LIMITED AFTER THE
  EXCHANGE OFFER.

     Because we anticipate that most holders of old notes will elect to exchange
their old notes, we expect that the liquidity of the market for any old notes
remaining after the completion of the exchange offer may be substantially
limited. Any old notes tendered and exchanged in the exchange offer will reduce
the aggregate principal amount of the old notes outstanding. Accordingly, the
liquidity of the market for any old notes could be adversely affected and you
may be unable to sell them. The extent of the market for the old notes and the
availability of price quotations would depend on a number of factors, including
the number of holders of old notes remaining outstanding and the interest of
securities firms in maintaining a market in the old notes. An issue of
securities with a smaller number of units available for trading may command a
lower, and more volatile, price than would a comparable issue of securities with
a larger number of units available for trading. Therefore, the market price for
the old notes that are not exchanged may be lower and more volatile as a result
of the reduction in the aggregate principal amount of the old notes outstanding.

  THERE IS CURRENTLY NO ACTIVE TRADING MARKET FOR THE NOTES. IF AN ACTIVE
  TRADING MARKET DOES NOT DEVELOP FOR THE NOTES, YOU MAY NOT BE ABLE TO RESELL
  THEM.

     No active trading market currently exists for the notes and an active
trading market may not develop in the future. The notes will not be listed on
any securities exchange. If an active trading market does not develop, it could
have an adverse effect on the market price of, and your ability to sell, the
notes. Historically, the market for non-investment grade debt has been subject
to disruptions that have caused substantial volatility in the prices of
securities similar to the notes. The market for the notes, if any, may be
subject to similar disruptions. The trading price may depend upon prevailing
interest rates, the market for similar securities, and other factors, including
general economic conditions and our financial condition, performance and
prospects. These factors could adversely affect you as a holder of notes.

  NON-U.S. HOLDERS OF THE NOTES ARE SUBJECT TO RESTRICTIONS ON THE RESALE OF THE
  NOTES.

     We sold the old notes in reliance on exemptions from the laws of other
jurisdictions where the notes were offered and sold, and therefore the old notes
may be transferred and resold, including pursuant to the exchange offer, only in
compliance with the laws of those jurisdictions to the extent applicable to the
transaction, the transferor and/or the transferee. Although we registered the
notes under the Securities Act, we did not, and do not intend to, qualify the
notes for distribution in Canada by prospectus and, accordingly, the notes will
remain subject to restrictions on resale in Canada. In addition, non-U.S.
holders

                                        17


will remain subject to restrictions imposed by the jurisdiction in which the
holder is resident. See "The Exchange Offer."

RISKS RELATED TO OUR BUSINESS

  OUR THEATRE SYSTEM REVENUE CAN VARY SIGNIFICANTLY FROM OUR CASH FLOWS UNDER
  THEATRE SYSTEM SALES AND LEASE AGREEMENTS.

     Our theatre system revenue can vary significantly from the associated cash
flows. We generally provide our theatre systems to customers on a long-term
lease basis with initial lease terms of typically 10 to 20 years. Our lease
agreements typically provide for three major sources of cash flow:

     - initial rental fees, which are paid in installments commencing upon the
       signing of the lease agreement until installation of the system;

     - ongoing rental payments, which are paid monthly after system installation
       and are generally equal to the greater of a fixed minimum amount per
       annum and a percentage of box office receipts; and

     - annual maintenance fees, which are generally payable commencing in the
       second year of theatre operations.

     Initial rental payments generally make up a majority of cash received for a
theatre system lease.

     Theatre system leases that transfer substantially all of the benefits and
risks of ownership to customers are classified as sales-type leases. Revenue
from sales-type leases is recorded at the time installation is complete and
other revenue recognition conditions are satisfied. The revenue recorded is
equal to the sum of initial rental payments and the present value of minimum
additional rental fees due under the lease agreement. Cash received from initial
rental fees in advance of installation is recorded as deferred revenue.

     Leases that do not transfer substantially all of the benefits and risks of
ownership to the customer are classified as operating leases. For these leases,
initial rental fees and minimum ongoing rental payments are recognized as
revenue on a straight-line basis over the lease term.

     Periodically, we sell our theatre systems to customers. These sales
generally provide for initial cash receipts and the receipt of payments over
time, typically 10 to 20 years.

  THERE IS COLLECTION RISK ASSOCIATED WITH LEASE PAYMENTS TO BE RECEIVED OVER
  THE TERMS OF OUR THEATRE SYSTEM LEASES.

     We are dependent in part on the viability of the North American commercial
exhibitor market for collections under long-term leases. In recent years, many
of the North American commercial exhibitor chains faced financial difficulties.
We cannot assure you that commercial exhibitors to whom we lease theatre systems
will not experience financial difficulties in the future. We may not collect all
of our contracted future lease payments. Our revenue can vary significantly from
our cash flows under theatre system sales and lease agreements, and there is
collection risk associated with rental payments to be received over the terms of
our leases.

  WE MAY NOT CONVERT ALL OF OUR BACKLOG INTO REVENUE AND CASH FLOWS.

     We list signed contracts for theatre system sales and sales-type leases as
sales backlog prior to the time of revenue recognition. Sales backlog represents
the total value of all signed system sales and lease agreements that are
expected to be recognized as revenue in the future and includes initial rental
fees along with the present value of contractual minimum rents due over the
lease term, but excludes maintenance revenues as well as rents in excess of
contractual minimums that might be received in the future. All of our customers
with which we have signed contracts may not accept delivery of theatre systems
that are included in our backlog. Moreover, if we litigate to enforce a
customer's contractual obligations, there are no guarantees that such
obligations will ultimately be deemed to be enforceable. This could adversely
affect our future revenues. We have litigated in the past and are litigating
presently with

                                        18


customers who have refused to honor all of their backlog obligations. In
addition, customers with system obligations in backlog sometimes request that we
agree to modify or reduce such obligations. We have in the past, under certain
circumstances, and are presently, negotiating to restructure backlog obligations
of certain customers. The backlog obligations of other customers may also be
modified, reduced or otherwise restructured in the future, which can adversely
affect our future revenues and cash flows.

  WE DEPEND ON COMMERCIAL MOVIE EXHIBITORS TO LEASE OUR IMAX THEATRE SYSTEMS AND
  TO PROVIDE ADDITIONAL REVENUES AND VENUES IN WHICH TO EXHIBIT OUR IMAX DMR
  FILMS.

     A number of our commercial exhibition customers have emerged from
bankruptcy protection in recent years. We are unable to predict if or when they
or other exhibitors will lease or continue to lease IMAX theatre systems from us
or whether other commercial movie exhibitors will experience significant
financial difficulties in the future. A number of the IMAX theatres operated by
commercial exhibitors have been unprofitable in the past. If exhibitors choose
to reduce their levels of expansion or decide not to lease IMAX theatre systems
for their existing or new theatres, our revenues would not increase at an
anticipated rate and motion picture studios may be less willing to reformat
Hollywood 35mm films into our 15/70 film format for exhibition in commercial
IMAX theatres. As a result, our future revenues could be adversely affected.

  OUR OPERATING RESULTS AND CASH FLOW CAN VARY SUBSTANTIALLY FROM QUARTER TO
  QUARTER AND COULD INCREASE THE VOLATILITY OF OUR SHARE PRICE.

     Our operating results and cash flow can fluctuate substantially from
quarter to quarter. In particular, fluctuations in theatre system installations
can materially affect operating results. In addition, theatre system contract
signings are not related to the timing of revenue recognition, and can have a
significant impact on our cash flow. This can make it difficult to accurately
forecast sales and profits or losses. Factors that have affected our operating
results and cash flow in the past, and are likely to affect our operating
results and cash flow in the future include, among other things:

     - the timing of signing and installation of new theatre systems;

     - demand for, and acceptance of, our products and services;

     - revenue recognition of sales and sales-type leases;

     - classification of leases as sales-type versus operating leases;

     - volume of orders received and that can be fulfilled in the quarter;

     - the level of our sales backlog;

     - the timing and commercial success of films produced and distributed by us
       and others;

     - the signing of film distribution agreements;

     - the financial performance of IMAX theatres operated by our customers and
       by us; and

     - the financial difficulties, including bankruptcies, faced by our
       customers, particularly our customers in the commercial exhibition
       industry.

     Most of our operating expenses are fixed in the short term. We may be
unable to rapidly adjust our spending to compensate for any unexpected sales
shortfall, which would harm quarterly operating results. The results of any
quarterly period are not necessarily indicative of our results for any other
quarter or for a full fiscal year.

  WE MAY NOT BE ABLE TO GENERATE PROFITS IN THE FUTURE.


     We may not be able to generate profits in any future period. Although we
generated a net profit for the years ended December 31, 2003 and 2002, for the
years ended December 31, 2000 and 2001, we had significant net losses and
experienced a decline in our sales and leases of theatre systems and backlog. If

                                        19


we do not generate profits in future periods, we may be unable to finance the
operations of our business or meet our debt obligations.

  OUR STRATEGY OF RE-MASTERING 35MM FILMS INTO THE 15/70 FILM FORMAT IS IN ITS
  EARLY STAGES OF IMPLEMENTATION AND EXPOSES US TO RISK.

     We have released four live-action 35mm films which have been reformatted
using our IMAX DMR technology and have contracted for the release of a fifth
such film in June 2004; the first live-action film formatted with IMAX DMR
technology into our 15/70 film format was released in September 2002. The
development of our IMAX DMR technology may not translate into additional
Hollywood films being distributed to the IMAX theatre network or additional
demand for IMAX systems. First, motion picture studios could find either the
technology or the potential revenues insufficient to justify reformatting
existing or new films into the 15/70 film format. Second, even if motion picture
studios agree to reformat their films with our IMAX DMR technology, such studios
may be reluctant to release reformatted films to IMAX theatres contemporaneously
with the initial release of such films to commercial 35mm theatres, which is an
important element of our commercial strategy. Third, even the most successful
existing or new films may prove to be unsuccessful when exhibited in IMAX
theatres.


     If IMAX DMR films released to the IMAX theatre network do not achieve
expected box office results, the revenue generated by our corporate theatres,
and thus our overall revenue, may be negatively impacted.


     In addition, motion picture studios could insist upon significant capital
contributions by us to go toward either the costs of reformatting a film, the
marketing of the reformatted film or both. Moreover, actual costs may exceed
their budgets and resulting revenues.

     Even though our IMAX DMR technology is patent-pending, such patents may not
be granted or the technology may prove to have low barriers to entry for others.
Other parties could develop similar or superior technology and release
reformatted Hollywood films to IMAX theatres or our competitors, without our
receiving any of the distribution or royalty revenue.

  THE SUCCESS OF THE IMAX THEATRE NETWORK IS DIRECTLY RELATED TO THE
  AVAILABILITY AND SUCCESS OF 15/70 FORMAT FILMS, OF WHICH WE PRODUCE A SMALL
  PERCENTAGE.

     An important factor affecting the growth and success of the IMAX theatre
network is the availability of 15/70 format films. We produce only a small
number of 15/70 format films and, as a result, we rely principally on 15/70
format films produced by third party filmmakers or converted from 35mm format
using our IMAX DMR technology. Third party filmmakers may not have sufficient
capital or other resources to continue to produce 15/70 format films or the
15/70 format films they produce may not be commercially successful.

  THE PRODUCTION OF 15/70 FORMAT FILMS REQUIRES SIGNIFICANT CAPITAL AND INVOLVES
  SUBSTANTIAL RISKS.

     The production, completion and distribution of 15/70 format films require a
significant amount of capital and involve substantial financial risks. Actual
costs may exceed budgets and factors such as technology changes, labor disputes
or other disruptions affecting aspects of production may affect third party
filmmakers, IMAX or our co-production partners and cause significant cost
overruns and delay or hamper completion of a production. We are continually
discussing the production or co-production of 15/70 format films, as well as the
reformatting of Hollywood films in connection with our IMAX DMR technology, with
various motion picture studios. However, we may not be able to complete
production or co-production arrangements with motion picture studios, and we may
not earn an adequate return on capital on these investments.

                                        20


  OUR REVENUES FROM EXISTING CUSTOMERS ARE DERIVED IN PART FROM FINANCIAL
  REPORTING PROVIDED BY OUR CUSTOMERS, WHICH MAY BE INACCURATE OR INCOMPLETE,
  RESULTING IN LOST OR DELAYED REVENUES.

     A portion of our lease payments and our film license fees are based upon
financial reporting provided by our customers. If such reporting is inaccurate,
incomplete or withheld, our ability to invoice and receive the proper amount
from our customers in a timely fashion will be impaired. Our contractual audits
may not rectify payments lost or delayed as a result of customers not fulfilling
their contractual requirements with respect to financial reporting.

  OUR NEWEST THEATRE PROJECTION SYSTEM, IMAX MPX, WHICH IS AN IMPORTANT
  COMPONENT OF OUR PLANS TO EXPAND THE NETWORK OF COMMERCIAL IMAX THEATRES, HAS
  NOT YET BEEN INSTALLED IN ANY THEATRES AND COULD PERFORM INADEQUATELY,
  RESULTING IN THE LOSS OF EXISTING AND FUTURE CONTRACTS.

     We depend on our theatre systems technology. In March 2003, we introduced
the IMAX MPX, a new projection system designed for commercial multiplex
operators which, together with IMAX DMR, is an important part of our expansion
plans. While we have signed contracts for the installation of IMAX MPX systems,
no such systems are scheduled to be installed until the first half of 2004 and
while we believe these systems will operate adequately, there are no guarantees
that they will do so. If for some reason a number of the IMAX MPX systems
perform inadequately, it could result in our losing existing contracts and our
inability to sign contracts for IMAX MPX systems in the future, which could
adversely affect our plans to expand the network of commercial IMAX theatres and
to have additional IMAX DMR films released to that network.

  WE CONDUCT BUSINESS INTERNATIONALLY WHICH EXPOSES US TO UNCERTAINTIES AND
  RISKS THAT COULD NEGATIVELY AFFECT OUR OPERATIONS AND SALES.


     A significant portion of our sales are made to customers located outside
the United States and Canada. Approximately 35.5%, 37.0% and 39.7% of our
revenues were derived outside of the United States and Canada in 2001, 2002 and
2003, respectively. We expect our international operations to continue to
account for a significant portion of our revenues in the future and plan to
expand into new markets in the future. We do not have significant experience in
operating in certain foreign countries and are subject to the risks associated
with operating in those countries. We currently have installation and sales
activity projected in countries where economies have been unstable in recent
years. The economies of other foreign countries important to our operations
could also suffer slower economic growth or instability in the future. The
following are among the risks that could negatively affect our operations and
sales in foreign markets:


     - new restrictions on access to markets;

     - unusual or burdensome foreign laws or regulatory requirements or
       unexpected changes to those laws or requirements;

     - fluctuations in the value of foreign currency versus the U.S. dollar and
       potential currency devaluations;

     - new tariffs, trade protection measures, import or export licensing
       requirements, trade embargoes and other trade barriers;

     - imposition of foreign exchange controls in such foreign jurisdictions;

     - dependence on foreign distributors and their sales channels;

     - difficulties in staffing and managing foreign operations;

     - adverse changes in monetary and/or tax policies;

     - poor recognition of intellectual property rights;

     - inflation;

                                        21


     - requirements to provide performance bonds and letters of credit to
       international customers to secure system deliveries; and

     - political, economic and social instability in foreign countries.

  WE FACE RISKS IN CONNECTION WITH THE EXPANSION OF OUR BUSINESS IN CHINA AND
  OTHER PARTS OF ASIA.

     The first IMAX projection system in a theatre in China was installed in
December 2001 and seven additional IMAX theatre systems are scheduled to be
installed in China by 2008. We moved our Asian headquarters to Shanghai and
believe that China is an important market for our international expansion plans.
These plans may be unsuccessful in China for a number of reasons including
China's poor recognition of intellectual property rights and its restrictive
regulations regarding the importation of film. Moreover, the geopolitical
instability of the region comprising China, Taiwan, North Korea and South Korea
could result in economic embargoes, disruptions in shipping or even military
hostilities, which could interfere with both the fulfillment of our existing
contracts and our pursuit of additional contracts in China.

     In addition, the recent outbreak of severe acute respiratory syndrome, or
SARS, which has had a particularly disruptive impact on business in China, Hong
Kong and Singapore, could have a negative effect on our pursuit of business
opportunities in Asia as a re-emergence of SARS could interfere with travel to
and negotiations with parties in that continent.

  THE INTRODUCTION OF NEW PRODUCTS AND TECHNOLOGIES AND CHANGES IN THE WAY OUR
  COMPETITORS OPERATE COULD HARM OUR BUSINESS.

     The out-of-home entertainment industry is very competitive, and we face a
number of challenges. We compete with other large-format film projection system
manufacturers as well as conventional motion picture exhibitors. In addition to
existing competitors, we may also face competition in the future from companies
in the entertainment industry with substantially greater capital resources. We
also face competition from a number of alternative motion picture distribution
channels such as home video, pay-per-view, video-on-demand, DVD, and syndicated
and broadcast television. We also compete for the public's leisure time and
disposable income with other forms of entertainment, including sporting events,
concerts, live theatre and restaurants.

     Furthermore, the out-of-home entertainment industry in general is
undergoing significant changes. Primarily due to technological developments and
changing consumer tastes, numerous companies are developing, and are expected to
continue to develop, new entertainment products for the out-of-home
entertainment industry, which may compete directly with our products.
Competitors may design products which are more attractive to the consumer and/or
more cost effective than ours and may make our products less competitive. The
products that we are currently developing may never be attractive to consumers
or be competitive. As a result of this competition, we could lose market share
as demand for our products declines, which could seriously harm our business and
operating results.

     The motion picture exhibition industry is in the early stages of conversion
from film based media to electronic based media. We are similarly in the very
early stages of developing a digital projection system that can be utilized in
IMAX theatres. As any large scale conversion from film to digital, particularly
in the large-format theatre industry, is most likely years away, it is difficult
to assess the risks for us associated with such a conversion. Such risks could
include the need for us to raise additional capital to finance remanufacturing
of theatre systems and associated conversion costs, which capital may not be
available to us on attractive terms, or at all.

  AN ECONOMIC DOWNTURN COULD MATERIALLY AFFECT OUR BUSINESS BY REDUCING DEMAND
  FOR IMAX THEATRE SYSTEMS AND REVENUE GENERATED FROM BOX OFFICE SALES.

     We depend on the sale and lease of IMAX theatre systems to commercial movie
exhibitors to generate a significant portion of our revenues. Most of our lease
agreements provide for additional revenues

                                        22


based on a percentage of theatre box office receipts when attendance at an IMAX
theatre exceeds a minimum threshold. Commercial movie exhibitors generate
revenues from consumer attendance at their theatres, which are subject to
general political, social and economic conditions and the willingness of
consumers to spend discretionary money at movie theatres. If theatre attendance
declines as a result of a prolonged economic downturn, commercial movie
exhibitors will be less willing to invest capital in new theatres resulting in a
decline in demand for new IMAX theatre systems. In addition, any decline in
attendance at commercial IMAX theatres will reduce the additional revenues we
generate from a percentage of theatre box office receipts. Institutional
exhibitors may also experience a decline in attendance given general political,
social and economic conditions, which may result in reduced revenues generated
from receipts attributed to IMAX theatres at such institutions and reduced film
license fees.

  WE MAY EXPERIENCE ADVERSE EFFECTS DUE TO EXCHANGE RATE FLUCTUATIONS.

     A substantial portion of our revenues is denominated in U.S. dollars, while
a substantial portion of our expenses is denominated in Canadian dollars. We
also generate revenues in Euros and Japanese Yen. From time to time, we enter
into forward contracts to hedge our exposure to exchange rate fluctuations.
However, our strategy may not be successful in reducing our exposure to these
fluctuations. Any material increase in the value of the Canadian dollar in
relation to the U.S. dollar compared to historical levels could have a material
adverse effect on our operating results.

  WE ARE SUBJECT TO IMPAIRMENT LOSSES ON OUR ASSETS.

     During the past five years, a substantial number of our theatre systems
were leased to commercial movie exhibitors. During 2000 and 2001, we recorded
significant restructuring costs and asset impairments related to the financial
difficulties of commercial movie exhibitors and other related industry factors.
Similar financial difficulties for commercial movie exhibitors and other
industry factors may reoccur in the future which could result in further
write-downs.

     We amortize our film assets using the individual film forecast method
whereby the costs of film assets are amortized and participation costs are
accrued for each film in the ratio of revenues earned in the current period to
management's estimate of total revenues ultimately expected to be received for
that title. Management regularly reviews and revises when necessary its
estimates of ultimate revenues on a title-by-title basis, which may result in a
change in the rate of amortization of the film assets and write-downs to film
assets. Results of operations in future years depend upon the amortization of
our film assets and may be significantly affected by periodic adjustments in
amortization rates. In 2000 and 2001, we recorded significant impairment charges
against film assets due to reductions in estimates of ultimate future revenues
that resulted in the fair values of some titles being less than their carrying
values. Given the inherent difficulties in producing successful theatrical films
for release in IMAX theatres, and the uncertainties inherent in the estimation
process, additional impairment charges may be necessary in the future.

  WE RELY ON OUR KEY PERSONNEL, AND THE LOSS OF ONE OR MORE OF THOSE PERSONNEL
  COULD HARM OUR ABILITY TO CARRY OUT OUR BUSINESS STRATEGY.

     Our operations and prospects depend in large part on the performance and
continued service of our senior management team. We may not find qualified
replacements for any of these individuals if their services are no longer
available. The loss of the services of one or more members of our senior
management team could adversely affect our ability to effectively pursue our
business strategy.

  OUR ABILITY TO ADEQUATELY PROTECT OUR INTELLECTUAL PROPERTY IS LIMITED, AND
  COMPETITORS MAY MISAPPROPRIATE OUR TECHNOLOGY, WHICH COULD WEAKEN OUR
  COMPETITIVE POSITION.

     We depend on our proprietary knowledge regarding IMAX theatre systems. We
rely principally upon a combination of copyright, trademark, patent and trade
secret laws, restrictions on disclosures and contractual provisions to protect
our proprietary and intellectual property rights. These laws and procedures
                                        23


may not be adequate to prevent unauthorized parties from attempting to copy or
otherwise obtain our technology or deter others from developing similar
technology, which could weaken our competitive position. The protection provided
to our proprietary technology by the laws of foreign jurisdictions may not
protect us as fully as the laws of Canada or the United States. Some of the
underlying technologies of our products and systems are not covered by patents
or patent applications.

     We have patents issued, provisional patents and patent applications
pending, including those pending for our digital conversion technology, IMAX
DMR. Our patents are filed in the United States often with corresponding patents
or filed applications in other jurisdictions, such as Canada, Japan, Korea,
France, Germany and the United Kingdom. The patents may not be issued or provide
us with any competitive advantages. The patent applications may also be
challenged by third parties. Several of our issued patents in the United States,
Canada and Japan for improvements to IMAX projection systems, IMAX 3D Dome and
sound systems expire between 2008 and 2018. Any claims or litigation initiated
by us to protect our proprietary technology could be time consuming, costly and
divert the attention of our technical and management resources.

  WE ARE SUBJECT TO LAWSUITS THAT COULD DIVERT OUR RESOURCES AND RESULT IN THE
  PAYMENT OF SUBSTANTIAL DAMAGES.

     Our industry is characterized by frequent claims and related litigation
regarding breach of contract and related issues. We are subject to a number of
legal proceedings and claims that arise in the ordinary course of our business.
We cannot assure you that we will succeed in defending any claims, that
judgments will not be entered against us with respect to any litigation or that
reserves we may set aside will be adequate to cover any such judgments. If any
of these actions or proceedings against us is successful, we may be subject to
significant damages awards. In addition, we are the plaintiff in a number of
material lawsuits in which we seek the recovery of substantial payments. We are
incurring significant legal fees in prosecuting these lawsuits, and we may not
ultimately prevail in such lawsuits or be able to collect on such judgments if
we do. In addition, the defense and prosecution of these claims divert the
attention of our management and other personnel for significant periods of time.

     As the largest manufacturer of large-format theatre projection systems in
the world, we have been the subject of anti-trust complaints and investigations
in the past and at present. We may be unsuccessful in defeating the current
claims or potential claims against us, and we may be sued or investigated on
similar grounds in the future.

  BECAUSE WE ARE INCORPORATED IN CANADA, IT MAY BE DIFFICULT FOR YOU TO ENFORCE
  AGAINST US LIABILITIES BASED SOLELY UPON U.S. FEDERAL SECURITIES LAWS.

     We are incorporated under the federal laws of Canada, some of our directors
and officers are residents of Canada and a substantial portion of our assets and
the assets of such directors and officers are located outside the United States.
As a result, it may be difficult for United States holders of the notes to
effect service within the United States upon those directors or officers who are
not residents of the United States, or to realize against them or us in the
United States upon judgments of courts of the United States predicated upon the
civil liability under the United States federal securities laws. In addition, it
may be difficult for such holders to bring an original action outside of the
United States against us to enforce liabilities based solely on U.S. federal
securities laws.

                                        24


               SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION


     Some of the statements contained in this prospectus and the documents
incorporated by reference constitute forward-looking statements that reflect our
current expectations and projections. These forward-looking statements include,
but are not limited to, references to future capital expenditures (including the
amount and nature of the expenditures), business strategies and measures to
implement strategies, competitive strengths, goals, expansion and growth of our
business and operations, plans and references to our future success and
expectations regarding future operating results. These forward-looking
statements are based on assumptions and analyses made by us in light of our
experience and our perception of historical trends, current conditions and
expected future developments, as well as other factors we believe are
appropriate in the circumstances. However, whether actual results and
developments will conform with our expectations and predictions is subject to a
number of risks and uncertainties, many of which are beyond our control,
including, but not limited to, general economic, market or business conditions;
the opportunities (or lack thereof) that may be presented to and pursued by us;
competitive actions by other companies; conditions in the out-of-home
entertainment industry; changes in laws or regulations; conditions in the
commercial movie exhibition industry; the acceptance of our new technologies;
risks associated with investments and operations in foreign jurisdictions and
any future international expansion, including those related to economic,
political and regulatory policies of local governments and laws and policies of
the United States and Canada; and the potential impact of increased competition
in the markets we operate within. Consequently, all the forward-looking
statements made in this prospectus and the documents incorporated by reference
are qualified by these cautionary statements, including the factors discussed
under "Risk Factors" in this prospectus. Our actual results or anticipated
developments may not be realized or, even if substantially realized, they may
not have the expected consequences to, or effects on, us. We undertake no
obligation to update publicly or otherwise revise any forward-looking
information, whether as a result of new information, future events or otherwise.


     This prospectus and the documents incorporated by reference contain
information regarding market share, market position and industry data pertaining
to our business based on data and reports compiled by professional industry
organizations and analysts, and our knowledge of our revenue and markets.
Although we believe these sources are reliable, we have not independently
verified this market data. This market data includes projections that are based
on a number of assumptions. If any one or more of those assumptions turns out to
be incorrect, actual results may differ materially from the projections based on
these assumptions.

                                        25


                                USE OF PROCEEDS

     We will not receive any cash proceeds from the exchange offer. Because we
are exchanging the old notes for the notes, which have substantially identical
terms and evidence the same indebtedness as the old notes, the issuance of the
notes will not result in any increase in our indebtedness. The net proceeds from
the offering of the old notes was $154.0 million, after deducting the initial
purchasers' commissions and offering expenses payable by us. The net proceeds
from the offering of the old notes, together with cash on hand, was used to
purchase and redeem the $152.8 million outstanding principal amount of our
7 7/8% senior notes due 2005, and to pay for all related premiums, fees and
expenses of approximately $3.7 million.

                                        26


                                 CAPITALIZATION


     The following table sets forth our cash and cash equivalents and
capitalization as at December 31, 2003. Our capitalization is presented:


     - on an actual basis; and


     - on an adjusted basis to reflect the redemption of $29.2 million of
       outstanding 7 7/8% senior notes due 2005 on January 2, 2004 and the
       application of the net proceeds as described under "Use of Proceeds."


     You should read this table in conjunction with the section in our quarterly
and annual reports entitled "Management's Discussion and Analysis of Financial
Condition and Results of Operations," the audited consolidated financial
statements and the related notes and the unaudited interim consolidated
financial statements and the related notes.







                                                              AS AT DECEMBER 31, 2003
                                                              ------------------------
                                                               ACTUAL     AS ADJUSTED
                                                              ---------   ------------
                                                                   (IN THOUSANDS)
                                                                    
Cash and cash equivalents(1)................................  $ 47,282      $ 16,193
Restricted cash(2)..........................................  $  4,961      $  4,961
                                                              ========      ========
Long-term debt(3):
  7 7/8% senior notes due 2005..............................  $ 29,234      $     --
  9 5/8% senior notes offered hereby........................   160,000       160,000
                                                              --------      --------
  Total long-term debt......................................   189,234       160,000
                                                              --------      --------
  Total shareholders' deficiency(4).........................   (51,776)      (52,561)
                                                              --------      --------
Total capitalization........................................  $137,458      $107,439
                                                              ========      ========



- ---------------


(1) Excludes the payment of $0.2 million of interest on the 7 7/8% senior notes
    due 2005 redeemed on January 2, 2004.



(2) Represents cash collateralized in support of our letters of credit.



(3) On February 6, 2004 we entered into a loan agreement for a $20.0 million
    secured revolving credit facility with Congress Financial Corporation
    (Canada). As of March 31, 2004, we had $nil outstanding under this credit
    facility. See "Description of New Credit Facility."



(4) Total shareholders' deficiency as adjusted includes $0.2 million of pretax
    charges related to the write-off of deferred financing costs, $0.6 million
    of premiums, fees and expenses paid in connection with the purchase and
    redemption of $29.2 million of the 7 7/8% senior notes due 2005 on January
    2, 2004.


                                        27


                  SELECTED CONSOLIDATED FINANCIAL INFORMATION


     The following table sets forth selected consolidated financial information
derived from our audited consolidated financial statements for the years ended
December 31, 1999, 2000, 2001, 2002 and 2003, all of which were prepared in
accordance with United States generally accepted accounting principles.


     You should read the following information in conjunction with the section
in our quarterly and annual reports entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations," the audited
consolidated financial statements and the related notes and the unaudited
interim consolidated financial statements and the related notes, all
incorporated by reference in this prospectus.




                                                                            YEARS ENDED DECEMBER 31,
                                                              -----------------------------------------------------
                                                              1999(1)      2000       2001        2002       2003
                                                              --------   --------   ---------   --------   --------
                                                                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                                                            
STATEMENTS OF OPERATIONS DATA:
Revenue
  IMAX systems(2)...........................................  $126,826   $113,226   $  76,582   $ 70,959   $ 75,848
  Films.....................................................    47,227     41,711      29,923     40,556     25,803
  Theater operations........................................     7,159      8,467       6,540     12,284     13,109
  Other.....................................................     9,393      7,096       4,654      5,303      4,500
                                                              --------   --------   ---------   --------   --------
  Total revenue(1)..........................................   190,605    170,500     117,699    129,102    119,260
Costs of goods and services(3)..............................    94,407    106,429      94,969     75,634     67,283
                                                              --------   --------   ---------   --------   --------
Gross margin................................................    96,198     64,071      22,730     53,468     51,977
Selling, general and administrative expenses(4).............    32,524     42,079      45,850     34,906     33,312
Research and development....................................     3,136      6,497       3,385      2,362      3,794
Amortization of intangibles(5)..............................     2,159      2,948       3,005      1,418        573
Loss (income) from equity-accounted investees(6)............       683      4,811         (73)      (283)    (2,496)
Receivable provisions (recoveries), net.....................       949     13,086      18,102     (1,233)    (2,225)
Restructuring costs and asset impairments (recoveries)(7)...        --     11,152      45,269       (121)       969
                                                              --------   --------   ---------   --------   --------
Earnings (loss) from continuing operations(1)...............    56,747    (16,502)    (92,808)    16,419     18,050
                                                              --------   --------   ---------   --------   --------
Interest income.............................................     9,977      3,285         847        413        656
Interest expense............................................   (21,860)   (21,961)    (22,020)   (17,564)   (15,856)
Gain (loss) on retirement of notes(8).......................        --         --      55,577     11,900     (4,910)
Recovery on (impairment of) long-term investments(9)........        --     (4,133)     (5,584)        --      1,892
                                                              --------   --------   ---------   --------   --------
Earnings (loss) from continuing operations before income
  taxes and
  minority interest.........................................    44,864    (39,311)    (63,988)    11,168       (168)
Recovery of (provision for) income taxes(10)................   (17,175)    11,700     (27,848)        --        386
                                                              --------   --------   ---------   --------   --------
Earnings (loss) from continuing operations before minority
  interest..................................................    27,689    (27,611)    (91,836)    11,168        218
Minority interest...........................................    (1,207)        --          --         --         --
                                                              --------   --------   ---------   --------   --------
Net earnings (loss) from continuing operations..............    26,482    (27,611)    (91,836)    11,168        218
Net earnings (loss) from discontinued operations(11)........    (1,249)    (4,226)    (53,278)       804        195
                                                              --------   --------   ---------   --------   --------
Net earnings (loss) before cumulative effect of changes in
  accounting
  principles................................................    25,233    (31,837)   (145,114)    11,972        413
Cumulative effect of changes in accounting principles, net
  of income
  taxes(12).................................................        --    (61,110)         --         --       (182)
                                                              --------   --------   ---------   --------   --------
Net earnings (loss)(1)......................................  $ 25,233   $(92,947)  $(145,114)  $ 11,972   $    231
                                                              ========   ========   =========   ========   ========
Basic net earnings (loss) from continuing operations per
  common share..............................................  $   0.89   $  (0.93)  $   (2.97)  $   0.34   $   0.01
Diluted net earnings (loss) from continuing operations per
  common share..............................................  $   0.84   $  (0.93)  $   (2.97)  $   0.34   $   0.01



                                        28





                                                              YEARS ENDED DECEMBER 31,
                                                   -----------------------------------------------
                                                    1999      2000      2001      2002      2003
                                                   -------   -------   -------   -------   -------
                                                    (IN THOUSANDS, EXCEPT SYSTEMS AND RATIO DATA)
                                                                            
OTHER DATA:
Total systems signed(13):
  North America..................................       16         6         5         7         9
  International..................................       28        26         7        14        16
New systems installed:
  North America..................................       20         9         8         6        13
  International..................................       15        15         7        10         7
Total systems in operation, (period end).........      208       221       227       232       240
Capital expenditures.............................  $40,516   $47,187   $ 9,373   $ 3,958   $ 4,553
Cash provided by (used in) operating
  activities.....................................   (2,589)  (54,089)   (2,615)   22,291    (9,183)
Ratio of earnings to fixed charges(14)...........     2.91x       --        --      1.58x       --






                                                               AS AT DECEMBER 31,
                                              ----------------------------------------------------
                                                1999       2000       2001       2002       2003
                                              --------   --------   --------   --------   --------
                                                                 (IN THOUSANDS)
                                                                           
BALANCE SHEETS DATA:
Cash and cash equivalents...................  $ 32,470   $ 34,310   $ 20,515   $ 33,801   $ 47,282
Restricted cash.............................        --         --      5,873      3,335      4,961
Total assets(15)............................   538,237    492,100    261,512    242,976    250,376
Total long-term indebtedness................   300,000    300,000    229,643    209,143    189,234



- ---------------


 (1) In accordance with the interpretive guidance of SEC Staff Accounting
     Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial
     Statements," effective January 1, 2000, we recognize revenue on theatre
     system sales and sales-type leases at the time that installation is
     complete. Prior to January 1, 2000, we recognized revenue on theatre
     systems at the time of delivery. Pro forma revenue and net earnings (loss)
     as if SAB 101 had been applied during 1999 would have been $166.6 million
     and $7.7 million, respectively. As the SAB 101 adjustment was reflected in
     the statement of operations through a one-time cumulative adjustment in
     2000, certain line items in this table may reflect a revenue transaction
     twice.



 (2) In the normal course of our business, we each year will have customers who,
     for a number of reasons including the inability to obtain certain consents,
     approvals or financing, are unable to proceed with theatre construction.
     Once the determination is made that the customer will not proceed with
     installation, the lease agreement with the customer is generally terminated
     by us. Upon the customer and the Company being released from our future
     obligations under the agreement, the initial lease payments that the
     customer previously made to us are recognized as revenue. Included in
     systems revenue is $0.7 million, $1.4 million, $5.5 million, $5.1 million
     and $9.6 million in 1999, 2000, 2001, 2002 and 2003, respectively for
     amounts recognized for restructured and/or terminated lease agreements.



 (3) During the year ended December 31, 2000, we recognized an $8.6 million
     charge which relates to the write-down of certain films in distribution.
     Costs of goods and services during the year ended December 31, 2001
     included charges of $4.1 million and $16.5 million relating to a reduced
     realizable value of our inventories and reduced fair values of our film
     assets, respectively. During the year ended December 31, 2002, we also
     recorded charges of $1.2 million for inventories, due to a reduced net
     realizable value, and fixed assets of $2.8 million as the carrying value
     for the fixed assets exceeded the discounted future cash flows expected
     from the assets.


 (4) Selling, general and administrative expenses for the year ended December
     31, 2001 included a $2.6 million non-cash charge for incurred compensation
     resulting from a stock grant issuance.

                                        29



 (5) Effective January 1, 2002, we adopted FAS 142, under which goodwill and
     intangible assets with indefinite lives are no longer amortized but are
     reviewed at least annually for impairment. In accordance with FAS 142, the
     effect of this change in accounting principle is reflected prospectively.
     Included in amortization of intangibles is goodwill amortization of $2.6
     million, $1.8 million and $2.3 million for 1999, 2000 and 2001,
     respectively.



 (6) In 2000, loss (income) from equity-accounted investees included a $4.0
     million provision related to the guarantee of a term loan undertaken by the
     Forum Ride Associates joint venture, the principal business of which is the
     operation of the "Race for Atlantis" ride in Las Vegas. In 2003, loss
     (income) from equity-accounted investees included a gain of $2.3 million
     from the release of a financial guarantee.



 (7) In 2000, restructuring costs and asset impairments (recoveries) included
     charges of $11.2 million relating to fixed assets. In 2001, restructuring
     costs and asset impairments (recoveries) includes $16.3 million related to
     efforts to rationalize the business by reducing our overall corporate
     workforce and consolidation of our operations, which included relocating
     our sound-system facility to near Toronto, Canada. In the assessment of the
     assets, we recorded charges of $26.7 million of fixed assets, and $3.3
     million of other assets to recognize a decline in value considered other
     than temporary.



 (8) During the year ended December 31, 2001, we and one of our wholly-owned
     subsidiaries purchased and cancelled an aggregate of $70.4 million
     principal amount of our convertible subordinated notes for $13.7 million,
     consisting of $12.5 million in cash from the subsidiary and common shares
     issued by us valued at $1.2 million. We recorded a gain of $55.6 million in
     connection with this transaction. During 2002, we and one of our
     wholly-owned subsidiaries purchased and cancelled an additional aggregate
     of $20.5 million principal amount of our convertible subordinated notes for
     $8.1 million, consisting of $6.0 million in cash from the subsidiary and
     common shares by us valued at $2.1 million. We recorded a gain of $11.9
     million, in connection with this transaction. During 2003, we recorded a
     loss of $4.9 million related to costs associated with the repurchase,
     retirement and refinancing of $170.8 million of our 7 7/8% senior notes due
     2005.



 (9) Recovery on (impairment of) long-term investments represents charges of
     $4.1 million and $5.6 million relating to the impairment of certain of our
     long-term investments, for the years ended December 31, 2000 and 2001,
     respectively. In 2003, as a result of the Company entering into a
     settlement agreement with Mainframe Entertainment, Inc., we recorded a
     recovery of $1.9 million.


(10) In 2001, the provision for income taxes included a $41.2 million increase
     in the valuation allowance to reflect uncertainty associated with
     realization of our deferred income tax asset.


(11) Discontinued operations consisted of our Digital Projections subsidiary
     which was acquired in September 1999 and sold in December 2001 and our
     owned and operated Miami theatre which was opened in 1999 and closed in
     December 2003.



(12) In the year ended December 31, 2000, we recognized a charge of $54.5
     million, net of income tax benefit of $33.4 million, in accordance with the
     interpretive guidance of SAB 101. We also adopted SOP 00-2 and recorded a
     charge of $6.6 million, net of income tax benefit of $3.9 million, to
     reflect the adoption of this new pronouncement.



(13) Represents the number of theatre systems for which we reached sale or lease
     agreements (including joint ventures) in the periods indicated. The number
     of signings indicated for 1999 includes one theatre in which we have an
     equity interest.



(14) For the purpose of computing the ratios of earnings to fixed charges,
     "earnings" consist of earnings (loss) from continuing operations before
     income taxes and minority interest, loss (income) from equity-accounted
     investees, capitalized interest, amortization of capitalized interest and
     fixed charges. "Fixed charges" consist of interest expense, amortization of
     expenses related to indebtedness (which are included in interest expense),
     capitalized interest and an estimate of the interest within rental expense,
     deemed to be one-third of rental expense. Due to losses we incurred, the
     ratio coverage in certain years is less than 1:1. We would have had to
     generate additional earnings of


                                        30



     $35.4 million in 2000, $62.7 million in 2001 and $2.6 million in 2003 to
     achieve a ratio of 1:1 in those periods. This table shows how we calculate
     the ratio of earnings to fixed charges.





                                                                            YEARS ENDED DECEMBER 31,
                                                                -------------------------------------------------
                                                                 1999       2000       2001      2002      2003
                                                                -------   --------   --------   -------   -------
                                                                        (IN THOUSANDS EXCEPT RATIO DATA)
                                                                                           
   Earnings (loss) from continuing operations before income
     taxes and minority interest..............................  $44,864   $(39,311)  $(63,988)  $11,168   $  (168)
   Loss (income) from equity-accounted investees..............      683      4,811        (73)     (283)   (2,496)
   Capitalized interest.......................................     (754)    (1,393)      (511)       --        --
   Amortization of capitalized interest.......................       44        500      1,853        26        26
                                                                -------   --------   --------   -------   -------
                                                                 44,837    (35,393)   (62,719)   10,911    (2,638)
                                                                -------   --------   --------   -------   -------
   Fixed Charges:
     Interest expense.........................................   21,860     21,961     22,020    17,564    15,856
     Capitalized interest.....................................      754      1,393        511        --        --
     Estimate of the interest within rental expense...........      822      1,633      1,711     1,168     1,321
                                                                -------   --------   --------   -------   -------
     Total fixed charges......................................   23,436     24,987     24,242    18,732    17,177
                                                                -------   --------   --------   -------   -------
   Earnings...................................................  $68,273   $(10,406)  $(38,477)  $29,643   $14,539
                                                                =======   ========   ========   =======   =======
   Ratio of earnings to fixed charges.........................     2.91x        --         --      1.58x       --




(15) Total assets include the assets of discontinued operations, consisting of
     our Digital Projections subsidiary which was acquired in 1999 and sold in
     December 2001 and our owned and operated Miami theatre which was opened in
     1999 and closed in December 2003.


                                        31


                                    BUSINESS

OUR BUSINESS

     We are one of the world's leading entertainment technology companies,
specializing in large-format and three-dimensional, or 3D, film presentations.
IMAX projection systems use the largest commercially available film format,
which allows IMAX theatres to present images of exceptional quality and clarity.
These images, projected on screens that are up to one-hundred feet wide and
eight stories tall, are designed to fill a viewer's peripheral vision and
immerse them in the film. We generate the majority of our revenue through
upfront and recurring payments received in connection with the leasing of our
theatre systems. While many of these theatre systems are located in some of the
world's most prestigious museums and science centers, more recently the growth
in the IMAX network has been most significant at multiplex theatres and other
commercial venues, which we believe is the largest potential market for our
theatre systems.


     Our primary business is the design, manufacture and lease of projection and
sound systems for IMAX theatres. The majority of IMAX theatre systems are
operated by third parties under agreements with us. At December 31, 2003, there
were 240 IMAX theatre systems operating in more than 35 countries. We are also a
producer and distributor of large-format films and the largest provider of
large-format post-production services. In addition, we engage in other related
businesses, including renting camera equipment for large-format film production
and owning and operating seven IMAX theatres.


THE INDUSTRY

     IMAX created the large-format theatre industry when we were founded in
1967. The large-format theatre industry includes several manufacturers of 5, 8
and 10 perforation, 70mm projection systems. We are the largest participant in
the industry and we estimate that the IMAX theatres in operation represent a
significant majority of the large-format theatres in operation. IMAX theatre
systems exclusively use 15 perforation, 70mm, or 15/70, film, the largest
commercially available film size, which is approximately 10 times larger than
35mm film. Film is measured on the basis of size in terms of millimeters and
perforations. Projectors in conventional theatres use 4 perforation, 35mm film
whereas large-format projectors use film ranging from 5 perforation, 70mm up to
15 perforation, 70mm allowing the use of larger screens and yielding higher
quality images. The size of the film makes 15/70 projection systems difficult to
make and consequently there are very few manufacturers of these projectors. We
estimate that IMAX theatre systems represent almost all of the installed base of
both 15/70 theatre systems and 3D 15/70 film format theatre systems in the
world.

OUR COMPETITIVE ADVANTAGE

     We believe that IMAX has a significant competitive advantage because of:

     - Brand -- IMAX is one of the few widely recognized brands in filmed
       entertainment, and the only such brand in large-format theatres.

     - The IMAX Experience -- We believe IMAX theatre systems provide a unique
       and immersive film experience with the highest quality images and sound
       available.

     - Films -- IMAX theatres have exclusive access to our library of 15/70
       format films, the largest such library in the world. They will also have
       exclusive access to Hollywood films converted to 15/70 film format using
       our new and proprietary IMAX DMR technology, such as the last two films
       of the Matrix trilogy.

     - Innovation -- We have a tradition of innovation and continue to invest in
       research and development. In North America, we currently have 43 patents
       issued with 16 more pending. From the first large-format projector to 3D
       projection to IMAX DMR and IMAX MPX, we have a record of developing new
       technologies that improve our viewers' entertainment experience and
       increase our customers' profitability.

     - Reliability -- IMAX theatre systems have historical operating uptimes of
       approximately 99.9% based on scheduled shows.

                                        32


OUR BUSINESS STRATEGY

     We expect growth in our revenue will be primarily driven by new IMAX
theatre system leases to commercial exhibitors. We remain committed to our
historical roots in museums and science centers, but we believe that the size of
that market is relatively limited compared to the potential in the commercial
multiplex market. There are approximately 1,900 multiplexes in North America, of
which fewer than 35 have IMAX theatres, a penetration rate below 2%.
Internationally, the penetration rate is even lower. To expand our theatre
network, we intend to:

     - increase the revenue potential of commercial IMAX theatres and Hollywood
       studios by using our proprietary IMAX DMR technology which converts
       live-action films into IMAX-quality images and sound;

     - reduce the capital and operating costs of leasing an IMAX theatre for
       commercial exhibitors with our IMAX MPX theatre system; and

     - continue to grow in our existing, traditional customer base of
       educational and institutional centers.

  INCREASE REVENUE POTENTIAL OF COMMERCIAL IMAX THEATRES AND HOLLYWOOD STUDIOS


     The motion picture industry is increasingly producing large-scale Hollywood
blockbuster event films, which have proven to be significant revenue generators
worldwide. IMAX DMR allows us to digitally re-master virtually any 35mm
live-action film into IMAX's 15/70 film format at a cost of approximately $2
million to $4 million per film. We developed IMAX DMR to enable IMAX theatres to
become an additional distribution channel for commercial films developed and
produced by Hollywood studios and we believe that this new proprietary
technology will significantly expand the commercially attractive content
available for exclusive release to IMAX theatres and will increase their
revenues. While IMAX DMR gives us the ability to bring previously released
Hollywood classics to the IMAX network, the centerpiece of the IMAX strategy is
the contemporaneous release of event films in IMAX and 35mm theatres, such as
the November 5, 2003 release of The Matrix Revolutions. This allows the IMAX
release to take advantage of the considerable marketing campaigns studios
traditionally launch in connection with their biggest event films. It is our
primary goal that viewers will want to see these types of event films in IMAX
theatres and pay a premium price for the enhanced experience. In the North
American multiplexes that showed The Matrix Reloaded in 35mm and in IMAX's 15/70
film format, the average ticket price for the IMAX screening was $10.68 versus
$8.65 for the 35mm screening. At its release, the average North American ticket
price for the IMAX screening of The Matrix Revolutions was $11.20 versus $8.66
for the 35mm screening. We believe that the meaningful expansion of Hollywood
content available to IMAX theatres will result in increased attendance and
revenue at IMAX theatres and increased demand for IMAX theatre systems. We also
believe that such increased demand for our theatre systems will encourage
studios to release more films to the expanded IMAX theatre network, and that
this additional film product should further increase demand for IMAX theatre
systems. This increased demand will likely benefit our operations globally since
we anticipate that the Hollywood films distributed to the IMAX theatre network
will be made available to both North American and international IMAX theatres
and, in fact, have negotiated provisions in certain distribution agreements
facilitating the international distribution of such films.


     The first major studio film released to IMAX theatres, Fantasia/2000: The
IMAX Experience, released by the Walt Disney Company in January 2000, generated
more than $91 million in theatre box office receipts to date and demonstrated
that the IMAX theatre network was a viable distribution network for Hollywood
films. The first film re-mastered with IMAX DMR technology was Universal
Studios' Apollo 13. Apollo 13: The IMAX Experience was released in September
2002, which demonstrated the appeal of the IMAX DMR technology. This was
followed by the release by 20th Century Fox of Star Wars Episode II: Attack of
the Clones -- The IMAX Experience, which generated more revenue per screen in
its opening weekend than any other film in North America during that period. On
April 22, 2003, we announced an agreement with Warner Bros. Pictures to convert
The Matrix Reloaded and The Matrix Revolutions, the last two films of the Matrix
trilogy that began with the 1999 blockbuster film The Matrix,
                                        33



to IMAX's format. The IMAX DMR version of The Matrix Reloaded ran exclusively on
over 70 IMAX screens beginning June 6, 2003, approximately four weeks after the
domestic release of the film to conventional 35mm theatres. Since the IMAX
release, IMAX screens have accounted for 27% of the film's total box office
receipts in North America to October 31, 2003 despite accounting for just 7.3%
of the screens exhibiting the film in North America. On November 5, 2003, The
Matrix Revolutions became the first-ever live-action Hollywood film released
simultaneously to both IMAX theatres and 35mm theatres. In North America, the
film, which did not perform overall as well as The Matrix Reloaded at 35mm or
IMAX theatres, nevertheless grossed approximately $3.0 million in the first five
days of its release on 48 IMAX screens, representing approximately $63,000 in
per screen revenue. In addition, on December 18, 2003, we announced a further
agreement with Warner Bros. Pictures to convert Harry Potter and the Prisoner of
Azkaban, the third installment of the Harry Potter film series, to IMAX's 15/70
format. The film is scheduled to be released to 35mm theatres and IMAX theatres
in June 2004. We believe that these events position IMAX theatres as a unique
and separate release window for Hollywood films similar to the type created when
Hollywood studios began including the pay TV and home video industries as
release windows for their films.


     During the release of The Matrix Reloaded: The IMAX Experience, we
commissioned a third party research firm to quantify consumer response to IMAX
DMR. The research showed that 88% of the patrons were either extremely or very
satisfied with the experience, that 89% intended to recommend seeing the film at
an IMAX theatre and that 31% had never been to an IMAX theatre before. These
results are consistent with our primary goal of ensuring that consumers will
want to see high-profile event films in IMAX theatres and pay a premium price
for the enhanced experience. Early results from research conducted during the
release of The Matrix Revolutions: The IMAX Experience revealed similar
findings.

REDUCE THE CAPITAL AND OPERATING COSTS FOR COMMERCIAL EXHIBITORS

     We have consistently sought to improve the profitability of an IMAX theatre
by reducing theatre capital and operating costs. In the past, we have
successfully reduced our customers' costs by introducing innovations such as the
IMAX SR theatre system, which was designed for smaller markets. Continued
reduction of capital and operating costs remains a focus of our research and
development team. Our most recent achievement has been the development of the
IMAX MPX system, our new lower cost theatre projection system, designed
specifically for use in multiplex auditoriums. The IMAX MPX system reduces the
per-seat capital cost of an IMAX theatre by approximately 35% as compared to the
IMAX SR system and increases the potential market size for IMAX theatres. The
IMAX MPX system also reduces the operating costs required to run an IMAX theatre
by eliminating the need for a specialized projectionist. The IMAX MPX system can
be installed as part of a newly constructed multiplex, as an add-on to an
existing multiplex, or as a retrofit of two existing stadium seat multiplex
auditoriums. We believe that this innovative retrofit option represents a
significant opportunity for commercial operators to both reduce the capital
costs of building an IMAX theatre and improve the profitability of the two
multiplex auditoriums being retrofitted.


     Since its launch in early 2003, we reached agreement for the sale or lease
of 13 IMAX MPX systems as of March 31, 2004. The appeal of the IMAX MPX system
has extended beyond the domestic market, with system deals signed in China,
Russia and the Middle East as well as the United States. The first IMAX MPX
system is expected to be installed in the first half of 2004. We believe that
the combination of the IMAX MPX system with our IMAX DMR technology gives us the
ability to significantly grow our commercial theatre network by offering
multiplex exhibitors more and better film options for their theatres and an
easier and more cost-efficient system with which to exhibit those films.


  CONTINUED GROWTH IN OUR EXISTING CUSTOMER SEGMENT

     We continue to sell and lease IMAX theatre systems to educational and
institutional centers, particularly in international markets such as China. The
last two years have seen the successful release and development of numerous
traditional large-format films, particularly 3D films, which continue to perform
well in institutional, educational and commercial venues. Our fourth space film,
SPACE STATION, has
                                        34



generated approximately $69 million of gross box office receipts since its
release in April 2002 through to March 31, 2004, and continues to generate
significant weekly gross box office receipts. Our 2002 holiday film, Santa vs.
the Snowman, had a successful run in IMAX theatres during the 2002 holiday
season and was shown on 79 IMAX screens during the 2003 holiday season. James
Cameron's Ghosts of the Abyss, which was released by Disney to IMAX theatres in
April 2003, also performed well. We currently have two other notable films in
production or development, including NASCAR The IMAX Experience 3D, scheduled
for release in March 2004, and Magnificent Desolation, a film about the men of
the Apollo missions who walked on the moon, in collaboration with Playtone and
its principals, Tom Hanks and Gary Goetzman.


BUSINESS SEGMENTS

  THEATRE SYSTEM

     Our primary products are our large-format theatre systems. All IMAX theatre
systems include a unique rolling loop 15/70 projector that offers superior image
quality and stability; a 6-channel, digital sound system delivering up to 12,000
watts; a screen with a proprietary coating technology; a digital theatre control
system and extensive theatre planning, design and installation services. All
theatre systems also come with a license for the use of the IMAX brand. We
primarily offer four types of these theatre systems. Our GT theatre systems are
for theatres from 300 seats to up to 550 seats and our SR theatre systems
contain 270 to 300 seats. Our recently introduced IMAX MPX system is targeted
for multiplex complexes and IMAX MPX theatres are expected to have approximately
350 seats. All three of these system types come with "flat" screens that have a
minimum of curvature and tilt and can exhibit both 2D and 3D films. We also
produce a fourth category of theatre systems featuring heavily curved and tilted
screens that are used in dome shaped theatres. These theatre systems are
generally 2D only and are popular with our institutional clients.

     Screens in IMAX theatres are as large as one-hundred feet wide and eight
stories tall and we believe are the largest cinema screens in the world. Unlike
standard cinema screens, IMAX screens extend to the edge of a viewer's
peripheral vision to create immersive experiences which, when combined with our
superior sound system, make audiences feel as if they are a part of the
on-screen action in a way that is more intense and exciting than in traditional
theatres, a critical part of The IMAX Experience. Our IMAX 3D theatres further
increase the audience's feeling of immersion in the film by bringing images off
the screen.


     Revenue from theatre systems are our largest source of revenue,
representing 65.0%, 55.0% and 63.6% of our total revenue in 2001, 2002 and 2003,
respectively. We generally lease our theatre systems to our clients for initial
terms of 10 to 20 years. As part of the theatre systems leases, our clients make
substantial initial rental payments ranging from $1.0 million to $3.0 million,
the majority of which are paid to us before the theatre system is delivered.
After the theatre opens additional rental payments, generally equal to the
greater of 5% to 7% of theatre box office receipts or a minimum that ranges from
$50,000 to $100,000 per theatre, are due each year. These terms vary in certain
cases, particularly for some of our older theatres. We provide a
maintenance-free period for one year and thereafter provide maintenance service
in return for an annual fee that averages $65,000-$75,000 per year. The
additional rental payments and maintenance fees represent ongoing cash flow for
the duration of the lease.


  FILM PRODUCTION AND DISTRIBUTION


     We are a producer and distributor of large-format films. Through our
subsidiary David Keighley Productions 70mm Inc., we are also the largest
provider of large-format post-production services, such as editing, quality
control and developing film prints for both IMAX theatres and other large-format
customers. Revenue from film production and distribution represented 25.4%,
31.4% and 21.6% of our total revenue in 2001, 2002 and 2003, respectively.



  THEATRE OPERATIONS



     We have seven owned and operated theatres. In addition, we have entered
into commercial arrangements with theatres resulting in the sharing of profits
and losses. We also provide management services to two theatres.


                                        35


  OTHER


     Our other sources of revenue primarily consist of IMAX theatres that we
operate and revenue from businesses ancillary to our theatre systems business.
These include the rental of 15/70 cameras and after-market sales of components
for our projector and sound systems. Revenue from this business segment
represented 9.6%, 13.6% and 14.8% of our total revenue in 2001, 2002 and 2003,
respectively.


THE IMAX BRAND

     The IMAX brand is world famous and stands for the highest-quality, most
immersive filmed entertainment that combines stunning images of exceptional
quality and clarity on screens up to one-hundred feet wide and eight stories
tall, our proprietary 6-channel digital sound systems and unique theatre
designs. We believe that like Disney, IMAX is one of the few brands generally
recognized by consumers in filmed entertainment. Our research shows that the
IMAX brand is a significant factor in a consumer's decision to go to an IMAX
theatre. In addition, we believe that our significant brand loyalty among
consumers provides us with a strong, sustainable position in the large-format
theatre industry. The IMAX brand name cuts across geographic and demographic
boundaries.

     With an increasing number of IMAX theatres based in multiplexes and a
recent history of commercially successful films such as Everest, Fantasia/2000:
The IMAX Experience and recent IMAX DMR releases including the Matrix sequels,
IMAX is rapidly increasing its commercial presence. We believe the strength of
the IMAX brand will be an asset as we seek to become a new release window for
Hollywood event films. We believe that people will see the IMAX presentation of
these films as a special, high-quality experience, and will be willing to pay a
premium price for the enhanced experience.

IMAX DMR

     We have developed technology that makes it possible for virtually any 35mm
live-action film to be transformed at a cost of approximately $2 million to $4
million per film into the unparalleled image and sound quality of The IMAX
Experience. This patent-pending, proprietary system, known as IMAX DMR, opens
the IMAX theatre network up to releases from Hollywood's vast library of films
ranging from well-known classics to today's event films. The resulting images
are as large and sharp as the classic IMAX films audiences associate with the
IMAX brand.

     The IMAX DMR process involves the following:

     - scanning, at the highest resolution possible, each individual frame of
       the 35mm film and converting it into a digital image;

     - optimizing the image using proprietary image enhancement tools developed
       and refined over many years;

     - analyzing the information contained within a 35mm frame format and
       enhancing the digital image using techniques such as sharpening, color
       correction, grain removal and the elimination of unsteadiness; and

     - recording the enhanced digital signal onto 15/70 film.

     During the re-mastering process, IMAX's DMR technology introduces no
perceptible digital artifacts and the highly automated system allows the process
to meet rigorous film production schedules. We continue to improve the length of
time it takes to reformat a film with our IMAX DMR technology. Apollo 13 was
re-mastered in 16 weeks, Star Wars Episode II: Attack of the Clones was
re-mastered in eight weeks and The Matrix Reloaded was re-mastered in less than
four weeks. The IMAX DMR conversion of The Matrix Revolutions was done in
parallel with the movie's filming and editing, which is necessary for the
contemporaneous release of an IMAX DMR film.

     For IMAX DMR releases, the original soundtrack of the 35mm film is
re-mastered for IMAX's six-channel loudspeaker system. Unlike conventional
theatre sound systems, IMAX sound systems are uncompressed, full fidelity and
use proprietary loudspeaker systems that ensure every theatre seat is in a good
listening position with surround sound that puts audiences in the picture. With
IMAX DMR we can create that immersive experience with clear, distortion-free
soundtracks for films originally produced in

                                        36


35mm. While we can only convert 35mm images into IMAX's 15/70 film format in 2D
today, we have a research and development program underway focused on converting
live-action 35mm film to IMAX 3D. However, we currently have the ability to
convert computer generated animation to IMAX 3D and have done so successfully
with our 1999 release of Cyberworld.

SALES BACKLOG


     Signed contracts for theatre system leases and sales are listed as sales
backlog prior to the time of revenue recognition. The value of the sales backlog
represents the total value of all signed theatre system sales and sales-type
lease agreements that are expected to be recognized as revenue in the future.
The backlog includes initial rental fees along with the present value of
contractual minimum rents due over the lease term, but excludes maintenance
revenue as well as contingent rents in excess of contractual minimums that might
be received in the future. Sales backlog does not include revenue from theatres
in which we have an equity interest, agreements covered by letters of intent or
conditional theatre commitments.



     The Company's backlog can be segregated by both territory of future
installation and by customer type. The percentage of backlog relevant to each
territory (based on installed dollar value of anticipated systems revenue as at
December 31, 2003) is as follows: Europe -- 34%, Asia -- 32%, North America --
15%, South America -- 9% and rest of the world -- 10%. In addition,
approximately 90% of backlog represents future installations to commercial
theatre customers and 10% to institutional customers.



     During the year ended December 31, 2003, we reached agreement for the sale
or lease of 25 IMAX theatres, valued at $41.2 million. At December 31, 2003,
sales backlog consisted of contracts for 61 theatre systems with a total value
of $138.1 million versus 63 theatre systems for a total value of $154.9 million
in 2002.



     Theatre systems in our backlog are generally recognized as revenue 18 to 36
months after the signing of the contracts for such systems due to the time
necessary for the construction of the theatre. Because of this operating cycle,
as well as other factors such as the settlement and/or termination of certain
agreements in the ordinary course, we estimate that 35 to 45 of the theatre
systems currently in backlog will be recognized subsequent to 2004. We believe
that shorter installation cycles are likely to occur more frequently with the
introduction of our IMAX MPX theatre systems, which require less construction
time due to their design and retrofit capability. We reached agreement for the
sale or lease of nine IMAX MPX systems in 2003 that are included in our December
31, 2003 backlog.



     We consider each contract in backlog to represent a valid and binding
agreement with a customer. In the normal course of our business, we will have
customers who, for a number of reasons including the inability to obtain certain
consents, approvals or financing or an ongoing dispute or legal proceeding with
us, do not proceed with theatre construction (please refer to the "Legal
Proceedings" section of our 2003 annual report on Form 10-K for further
details). Once the determination is made that the customer will not proceed with
installation, the lease agreement with the customer is generally terminated by
us and removed from backlog.


MARKETING AND CUSTOMERS

     We market our theatre systems through a direct sales force and marketing
staff located in our offices in Canada, the United States, Europe, Singapore,
Japan and Shanghai. We also use agents and consultants in certain locations,
primarily Asia and South America. Because our clients have real estate
development matters to consider before committing to an IMAX theatre system, the
sales process from initial contact to contract signing can take three months to
a year or longer. Theatre systems are typically installed within 36 months after
the contract is signed.


     We have experienced an increase in the number of commercial theatre
signings and international signings since 1995. The commercial theatre portion
of our theatre network is now our largest component with a total of 60% theatres
opened or in backlog at December 31, 2003. At December 31, 2003, 37.0% of all
opened and in backlog theatres are for locations outside the United States and
Canada. Our institutional customers include science and natural history museums,
zoos, aquaria and other educational and cultural centers. We also lease our
theatre systems to theme parks, tourist destination sites, fairs and


                                        37



expositions. At December 31, 2003, no one customer represented more than 5.4% of
our installed base of theatres, more than 16% of our backlog or more than 10% of
our consolidated revenue derived from our "Film Production and Distribution" or
"Other" business segments.


     The institutional and entertainment destination markets, both domestic and
foreign, provide what we believe to be consistent demand for our theatre
systems. The operators of multiplex theatres have been our fastest growing
customer segment since 1997. The commercial exhibition industry went through
significant financial difficulties in 2000 and 2001, when numerous theatre
chains filed for bankruptcy protection due to over-building of multiplexes and
over-leverage. While this had a significant impact on our business and reported
financial results in 2000 and 2001, most of the companies have now emerged from
such proceedings and have successfully recapitalized. With the emergence of our
commercial strategy featuring IMAX DMR technology and the IMAX MPX system, it is
expected that these exhibitors will be a significant source of growth for us in
the future.

COMPETITION

     The out-of-home entertainment industry is very competitive, and we face a
number of challenges. We compete with a number of manufacturers of large-format
film projection systems, most of which utilize smaller film formats, including
8/70 and 10/70. We believe that IMAX theatre systems deliver an image that is
superior to these smaller film format images. The IMAX theatre network and the
number of 15/70 format films to which we have distribution rights are
substantially larger than those of our competitors, and IMAX DMR reformatted
films are available exclusively to the IMAX theatre network.


     In addition to existing competitors, we may also face competition in the
future from companies in the entertainment industry with substantially greater
capital resources. We also face competition from a number of alternative motion
picture distribution channels such as home video, pay per-view, video-on-demand,
DVD, and syndicated and broadcast television. We also compete for the public's
leisure time and disposable income with other forms of entertainment, including
sporting events, concerts, live theatre and restaurants.



     Furthermore, the out-of-home entertainment industry in general is
undergoing significant changes. Primarily due to technological developments and
changing consumer tastes, numerous companies are developing, and are expected to
continue to develop, new entertainment products for the out-of-home
entertainment industry, which may compete directly with our products.


RESEARCH AND DEVELOPMENT

     We believe that through 36 years of research and development, we have
developed the most technologically advanced and highest-quality theatre systems
in the world. We have extensive knowledge and capabilities in analog and digital
imaging and sound and are leaders in the development of new film technologies
and techniques. We employ more than 22 people in research and development who
work to enhance and maintain our technological skills.

     We have an established record of innovation that has bolstered our leading
industry position by offering enhanced entertainment experiences, reducing the
cost of IMAX exhibition and serving as a barrier-to-entry to potential
competitors. We introduced the revolutionary rolling loop projection system. The
key to the IMAX projector's superior performance and reliability is our unique
"rolling loop" film movement. The rolling loop advances the film horizontally in
a smooth, wave-like motion, which enhances the stability of the image and
greatly reduces wear on the film. In addition, we introduced the IMAX SR
projector, which was designed to fit in small theatre spaces while still fully
delivering The IMAX Experience, and IMAX MPX system, designed especially for
multiplex theatre operators, which lowers the capital and operating costs of an
IMAX theatre. Other notable innovations include our Personal Sound Environment,
a sound technology compatible with 3D viewing; SANDDE, a 3D animation system
using a magnetic wand; and the large-format industry's first laser film
recorder, which transfers digital images files onto film at much greater speed
and quality than the prior technology and is an important link to our IMAX DMR
strategy.

                                        38


     IMAX DMR provides the means to convert Hollywood's vast library of films as
well as new blockbuster releases, and since the invention of the rolling loop
15/70 projector, it may prove to be our most important innovation.


     In the last 3 years, we have spent $3.4 million, $2.4 million and $3.8
million on research and development in 2001, 2002 and 2003, respectively, or
2.9%, 1.8% and 3.2% of our total revenue.


MANUFACTURING AND SERVICE


     We assemble our projection systems at our Corporate Headquarters and
Technology Center in Mississauga, Canada (just outside Toronto). Most of the
components for our theatre systems are purchased from outside vendors. We depend
on a single source supplier for one of the components included in our
projections systems, but we believe this supplier is financially viable and have
made arrangements to gain access to the supplier's design and manufacturing
documentation in the event of a supply interruption. We develop and design all
the key elements for the proprietary technology involved in our projector and
camera systems. Fabrication of these components is then subcontracted to a group
of pre-qualified suppliers. Manufacture and supply contracts are signed for the
delivery of components on an order-by-order basis. The customer and its
contractors are responsible for physical installation of the theatre system,
while we are responsible for supervising the installation of the IMAX theatre
systems at the client's site. We are dependent on the customer and other third
parties to construct the theatre, the cost of which is borne by the customer,
and we cannot fulfill all our contractual obligations to the customer until the
customer has constructed the theatre.


     We believe the quality of our theatre systems is extremely important to our
customers, and we provide key services and support functions for the IMAX
theatre network and for filmmakers. To support the IMAX theatre network, we have
personnel stationed in major markets who provide periodic and emergency service
and maintenance on existing theatre systems throughout the world. Our personnel
typically visit each theatre every three months to service the projection and
sound systems. We also provide theatre design expertise for both the visual and
audio aspects of the theatre, as well as theatre system installation supervision
and equipment training. IMAX theatre systems have had historical operating
uptimes of approximately 99.9% based on scheduled shows.

PATENTS AND TRADEMARKS


     Our inventions cover various aspects of our proprietary technology, designs
and methods and many are protected by patents or patent applications filed
throughout the world, most significantly in the United States, Canada, Japan,
Korea, France, Germany and the United Kingdom. In North America, we currently
hold 43 patents and have 16 patents pending. We have corresponding patents or
filed applications in many countries throughout the world and we have been
diligent in the protection of our proprietary interests.



     In the theatre systems business segment, our patents cover projection
systems (2D and 3D) and components, theatre design, electronic circuitry and a
unique screen painting process for 3D presentations. Granted patents in this
segment generally expire between 2009 and 2020. In addition, we have applied for
a number of patents covering new technology as well as improvements and
modifications to our existing projection systems. In the film production
segment, our granted patents cover a 3D film production tool, an optical film
printer and image enhancement technology. Granted patents in this segment
generally expire between 2007 and 2019. In addition, we have applied for a
number of patents covering our remastering technology and process. In the other
business segment (which includes our cameral rental and after market sales of
components for our projection and sound systems) granted patents cover methods
and designs for our 3D cameras and sound systems. Granted patents in this
segment generally expire between 2007 and 2017. In addition, we have applied for
several patents covering modifications to our 3D sound systems.



     We own or otherwise have rights to trademarks and trade names used in
conjunction with the sale of our products and services across all three business
segments. The following trademarks are considered most significant in terms of
our current and contemplated operations: IMAX(R), IMAX(R) Dome, IMAX(R) 3D,
IMAX(R) 3D Dome, The IMAX Experience(R), An IMAX Experience(R), IMAX(R) DMR(R),
IMAX(R) MPX(TM),


                                        39



IMAX Think Big(TM) and Think Big(TM). These trademarks are widely protected by
registration or common law throughout the world. Our registered trademarks
generally come up for renewal between 2004 and 2011.


LEGAL MATTERS

     We are subject to legal proceedings and claims that arise in the ordinary
course of our business. Our current litigation is described in note 7 to our
unaudited interim financial statements incorporated by reference into this
prospectus.

EMPLOYEES

     As of December 31, 2003, we had 339 employees not including hourly
employees at our owned and operated theatres.

MANAGEMENT INFORMATION SYSTEMS

     We utilize a number of management information systems. We anticipate no
major changes to these systems in the near future.

                                        40


                                   MANAGEMENT

     The following table sets forth information regarding our directors and
executive officers.




NAME                                        AGE                    POSITION
- ----                                        ---                    --------
                                            
Richard L. Gelfond........................  48    Co-Chairman and Co-Chief Executive Officer
                                                  and Director
Bradley J. Wechsler.......................  52    Co-Chairman and Co-Chief Executive Officer
                                                  and Director
Neil S. Braun.............................  50    Director
Kenneth G. Copland........................  65    Director
Michael Fuchs.............................  56    Director
Garth M. Girvan...........................  54    Director
David W. Leebron..........................  49    Director
Marc A. Utay..............................  43    Director
Francis T. Joyce..........................  51    Chief Financial Officer
Greg Foster...............................  41    President, Filmed Entertainment
Robert D. Lister..........................  35    Executive Vice President, Business & Legal
                                                  Affairs and General Counsel
Brian Bonnick.............................  47    Senior Vice President, Technology
David B. Keighley.........................  56    Senior Vice President & President, David
                                                  Keighley Productions 70mm Inc.
Larry O'Reilly............................  41    Senior Vice President, Theatre Development
                                                  & Film Distribution
G. Mary Ruby..............................  46    Deputy General Counsel, Senior Vice
                                                  President, Legal Affairs and Corporate
                                                  Secretary
Mary C. Sullivan..........................  40    Senior Vice President, Human Resources &
                                                  Administration
Mark Welton...............................  40    Senior Vice President, Theatre Operations
Kathryn A. Gamble.........................  36    Vice President, Finance and Controller
Edward MacNeil............................  39    Vice President, Finance, Special Projects



     Under our articles of incorporation, our board of directors is divided into
three classes, each of which serves for a three year term. The term of Class III
directors, currently composed of Richard L. Gelfond and Bradley J. Wechsler,
expires in 2004. The term of Class II directors, currently composed of Kenneth
G. Copland, Garth M. Girvan, Marc A. Utay and David W. Leebron, expires in 2005.
The term of Class I directors, currently composed of Neil S. Braun and Michael
Fuchs, expires in 2006.


     RICHARD L. GELFOND has been our Co-Chairman since 1999 and Co-Chief
Executive Officer since 1996. From March 1994 to June 1999, Mr. Gelfond served
as Vice Chairman. Mr. Gelfond serves as Chairman of the Board of Trustees of the
Stony Brook Foundation, Inc., affiliated with Stony Brook University, and is on
the Board of Directors for Brookhaven Science Associates, the Management Company
of Brookhaven National Laboratories. He is also Vice Chairman of the Executive
Committee at the New York Historical Society. Mr. Gelfond is the Chairman of the
Columbia Shuttle Memorial Trust Steering Committee, which was established in
cooperation with NASA to support the families of the seven crew members of the
STS-107 mission of the Space Shuttle Columbia, which came to a tragic end on
February 1, 2003.



     BRADLEY J. WECHSLER has been our Co-Chairman since 1994 and Co-Chief
Executive Officer with Mr. Gelfond since 1996. Mr. Wechsler serves on the boards
of NYU Hospital where he is a Vice Chairman and member of the Executive
Committee, the Kernochan Center for Law, Media and the Arts, and the American
Museum of the Moving Image and the Ethical Culture Fieldston School.


     NEIL S. BRAUN has been a director since June 2003 and has been the
President of Vanguard Animation Studio since 2001. He was the President of
VastVideo Inc. prior to this and was President of

                                        41


iCast Corporation a wholly-owned subsidiary of CMGI, Inc. during 1999. From 1994
to 1998, Mr. Braun was President of NBC Television Network. Mr. Braun also sits
on the Share our Strength and Westhampton Beach Performing Arts Center boards of
directors and is a member of the University of Pennsylvania School of Arts and
Sciences Board of Overseers, all non-profit organizations.

     KENNETH G. COPLAND has been a director since 1999, and is the Chairman of
KGC Ltd. Mr. Copland was the Vice-Chairman of BMO Nesbitt Burns Inc. from 1994
to May 2001. He is Chairman of Humber College Foundation and HC Educational
Ventures Limited. Mr. Copland is a director of the Investment Dealers
Association of Canada.


     MICHAEL FUCHS has been a director since 2002; previously he was a director
from May 1996 to June 1999. Mr. Fuchs is the Chairman and a director of
Autobytel.com and the Chairman of Bryant Park Restoration Corporation. Mr. Fuchs
held the position of Chairman and Chief Executive Officer of Home Box Office
from October 1984 until November 1995. In May 1995, he also became chairman of
Warner Music Group. Mr. Fuchs is also on the Board of Trustees of the Simon
Wiesenthal Center and a member of the board of the Alzheimer Association.


     GARTH M. GIRVAN has been a director since 1994. Mr. Girvan is a director of
Corby Distilleries Limited and is a partner of McCarthy Tetrault LLP, our
Canadian counsel.


     DAVID W. LEEBRON has been a director since September 2003. Mr. Leebron has
been the Dean and Lucy G. Moses Professor of Law at Columbia University School
of Law since 1996, and Professor of Law since 1989. Effective July 1, 2004, Mr.
Leebron will become President of Rice University. Mr. Leebron is a member of the
American Bar Association and is on the board of directors of the American Law
Dean's Association.



     MARC A. UTAY has been a director since 1996, and has been a Managing Member
of Clarion Capital Partners since November 1999. Prior to joining Clarion, Mr.
Utay was a Managing Director of Wasserstein Perella & Co., Inc. and a member of
Wasserstein Perella's Policy Committee. Mr. Utay was co-head of Wasserstein
Perella's Leveraged Finance, Retailing and Media, Telecommunication and
Entertainment groups. Until December 2002, Mr. Utay was also a Senior Advisor to
Dresdner Kleinwort Wasserstein. Prior to his joining Wasserstein Perella, Mr.
Utay was Managing Director at Bankers Trust Company where he specialized in
leveraged finance and mergers and acquisitions. Mr. Utay is a director of P& F
Industries, Inc.


     FRANCIS T. JOYCE joined us in 2001 as Chief Financial Officer. Prior to
joining us, Mr. Joyce held the position of Chief Financial Officer of the
Internet company theglobe.com from 1998 until his employment with us. From 1997
to 1998, Mr. Joyce served as Chief Financial Officer of Reed Travel Group, a
division of Reed Elsevier PLC and from 1994 to 1997 served as Chief Financial
Officer of the Alexander Consulting Group, a division of Alexander and Alexander
Services Inc., an international professional services firm. Mr. Joyce is a
member of Financial Executive International and the American Institute of
Certified Public Accountants.


     GREG FOSTER joined us in 2001 as President, Filmed Entertainment. Prior to
joining us, Mr. Foster was Executive Vice-President of Production at MGM/UA.
Prior to that, Mr. Foster held other senior positions including Senior
Vice-President of Motion Picture Marketing Research during his 15 years at
MGM/UA. In 1999, Mr. Foster founded uMogul, a financial services company, and
held the positions of Chairman, Co-Founder and President.



     ROBERT D. LISTER joined us in 1999 as Senior Vice President, Legal Affairs
and General Counsel and was appointed Executive Vice President, Business & Legal
Affairs in 2001. Prior to joining us, Mr. Lister was Vice President, General
Counsel and Secretary of Clearview Cinemas, a film exhibitor, from March 1998
until his employment with us. Prior to that, Mr. Lister served as Associate
General Counsel of Merit Behavioral Care Corporation, a behavioral healthcare
company, from March 1996 through March 1998. Mr. Lister serves on the board of
the Giant Screen Theater Association. Mr. Lister is a member of the New York
State Bar Association.


     BRIAN BONNICK joined us in 1999 as Vice President, Research & Development
and was appointed Senior Vice President, Technology in 2001. Prior to joining
us, Mr. Bonnick was Vice President,

                                        42


Engineering and Operations for Electrohome Corporation. Prior to that, Mr.
Bonnick was Vice President and General Manager at TSB International Inc. a
telecommunications company. Mr. Bonnick is registered as a professional engineer
by the Association of Professional Engineers of Ontario.


     DAVID B. KEIGHLEY has been a Senior Vice President since 1997 and is
President of David Keighley Productions 70mm Inc., an IMAX subsidiary. From 1995
to 1997, Mr. Keighley was a Vice President. He is responsible for motion picture
and digital post-production and image quality assurance for 15/70-format films.



     LARRY O'REILLY joined us in 1994 as the Sales Manager, Film Distribution
and was appointed Senior Vice President, Theatre Development & Film Distribution
in 2002. Mr. O'Reilly has held various positions within the Company including
Manager, Business Development: Film; Director, Strategic Partnerships; Director,
Commercial Marketing: The Americas and Vice President, Sales, The Americas.


     G. MARY RUBY joined us in 1987 as Associate General Counsel and was
appointed Senior Vice President, Legal Affairs in 2001. Ms Ruby was General
Counsel from 1989 to 1997. Ms. Ruby is Deputy General Counsel and acts as
Corporate Secretary to our board of directors. Ms. Ruby is a member of the
Ontario Bar Association.


     MARY C. SULLIVAN joined us in 1996 as Director, Human Resources and was
appointed Vice President, Human Resources and Administration in 1998 and Senior
Vice President, Human Resources and Administration in 2000. Prior to joining us,
Ms. Sullivan was Director, Human Resources of Central Park Lodges. Ms. Sullivan
is a director of the Women's Legal Education and Action Fund and its Foundation.



     MARK WELTON joined us in 1997 as Director, Business Affairs and was
appointed Senior Vice President, Theatre Operations in October 2003. Previous to
that Mr. Welton was Senior Vice President, Business Affairs, a position he held
since September 2001. Prior to joining us, Mr. Welton was an associate lawyer at
Stikeman, Elliot from 1994 until his employment with the Company.



     KATHRYN A. GAMBLE joined us in 2001 as Vice President, Finance and
Controller. Prior to joining us, Ms. Gamble served as Vice President, Finance
and Chief Financial Officer of an Internet company, Healthyconnect.com Inc. from
2000 until her employment with the Company. From 1996 to 2000, Ms. Gamble served
as Vice President and Chief Financial Officer of Med-Emerg International Inc., a
healthcare company. Ms. Gamble is a member of the Canadian Institute of
Chartered Accountants.


     EDWARD MACNEIL joined us in 1994 as Director, Taxation & Treasury and was
appointed Vice President, Finance, Special Projects in 2001. From 1999 to 2001,
Mr. MacNeil held the position of Director and Senior Vice President, Digital
Projection Limited, a former IMAX subsidiary. Prior to joining us, Mr. MacNeil
was a Taxation Manager at PricewaterhouseCoopers LLP. Mr. MacNeil is a member of
the Canadian Institute of Chartered Accountants.

EMPLOYMENT CONTRACTS

     Our employment contracts with our two chief executive officers, Mr.
Wechsler and Mr. Gelfond, are summarized in our management proxy circular which
is incorporated by reference into this prospectus. Both agreements were renewed
in April 2002 for a two year period on substantially the same terms. Each
executive will receive a base salary of $500,000 per year, plus a bonus of up to
two times salary. The bonus is at the discretion of our board of directors and
will be based upon our success in achieving the goals and objectives set by our
board after consultation with the two executives. Mr. Wechsler and Mr. Gelfond
will also each be entitled to stock options expiring April 2012 for 532,000
common shares at an exercise price of $4.85 per share and stock options expiring
June 2012 for 68,000 common shares at an exercise price of $7.00 per share.

                                        43


                               THE EXCHANGE OFFER

GENERAL

     In connection with the issuance of the old notes, we and the subsidiary
guarantors entered into a registration rights agreement, dated December 4, 2003,
with the initial purchasers of the old notes. The following contains a summary
of the provisions of the registration rights agreement. It does not contain all
of the information that may be important to you. We refer you to the
registration rights agreement, which has been filed as an exhibit to the
registration statement of which this prospectus is a part.


     Under the registration rights agreement, we and the subsidiary guarantors
have agreed to (1) file with the Securities and Exchange Commission, or the SEC,
the registration statement of which this prospectus is a part with respect to a
registered offer to exchange the old notes for the notes, (2) use reasonable
best efforts to have the registration statement declared effective at the
earliest possible time and (3) use reasonable best efforts to complete the
exchange offer within 30 business days after the registration statement is
declared effective. We will keep the exchange offer open for the period required
by applicable law, but in any event for at least 20 business days after the date
notice of the exchange offer is mailed to holders of the old notes. The exchange
offer being made hereby, if commenced and consummated within the time periods
described in this paragraph, will satisfy these requirements under the
registration rights agreement.


     Upon the terms and subject to the conditions set forth in this prospectus
and in the letter of transmittal, all old notes validly tendered and not
withdrawn prior to 5:00 p.m., New York City time, on the expiration date will be
accepted for exchange. Notes will be issued in exchange for an equal principal
amount of outstanding old notes accepted in the exchange offer. Old notes may be
tendered only in integral multiples of $1,000. This prospectus, together with
the letter of transmittal, is being sent to all holders as of           , 2004.
The exchange offer is not conditioned upon any minimum principal amount of old
notes being tendered for exchange. However, the obligation to accept old notes
for exchange pursuant to the exchange offer is subject to certain customary
conditions as set forth herein under "-- Conditions."

     Old notes shall be deemed to have been accepted as validly tendered when,
as and if we have given oral or written notice thereof to U.S. Bank National
Association, the exchange agent. The exchange agent will act as agent for the
tendering holders of old notes for the purposes of receiving the notes and
delivering notes to such holders.

     Based on interpretations by the Staff of the SEC as set forth in no-action
letters issued to third parties (including Exxon Capital Holdings Corporation
(available May 13, 1988), Morgan Stanley & Co. Incorporated (available June 5,
1991), K-III Communications Corporation (available May 14, 1993) and Shearman &
Sterling (available July 2, 1993)), we believe that the notes issued pursuant to
the exchange offer may be offered for resale, resold and otherwise transferred
by any holder thereof (other than any such holder that is a broker-dealer or an
"affiliate" of us within the meaning of Rule 405 under the Securities Act)
without compliance with the registration and prospectus delivery provisions of
the Securities Act, provided that:

     - such notes are acquired in the ordinary course of business;

     - at the time of the commencement of the exchange offer such holder is not
       participating or engaged in, does not intend to participate or engage in,
       and has no arrangement or understanding with any person to participate
       in, a distribution of such notes; and

     - such holder is not engaged in, and does not intend to engage in, a
       distribution of such notes.

     We have not sought, and do not intend to seek, a no-action letter from the
SEC with respect to the effects of the exchange offer, and we cannot assure you
that the Staff of the SEC would make a similar determination with respect to the
notes as it has in such no-action letters.

                                        44


     By tendering old notes in exchange for notes and executing the letter of
transmittal, each holder will represent to us that:

     - any notes to be received by it will be acquired in the ordinary course of
       business;

     - it has no arrangements or understandings with any person to participate
       in the distribution of the old notes or notes within the meaning of the
       Securities Act; and

     - it is not our "affiliate" as defined in Rule 405 under the Securities
       Act.

     If such holder is a broker-dealer, it will also be required to represent
that the old notes were acquired as a result of market-making activities or
other trading activities and that it will deliver a prospectus in connection
with any resale of notes. See "Plan of Distribution." Each holder, whether or
not it is a broker-dealer, shall also represent that it is not acting on behalf
of any person that could not truthfully make any of the foregoing
representations contained in this paragraph. If a holder of old notes is unable
to make the foregoing representations, such holder may not rely on the
applicable interpretations of the Staff of the SEC and must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any secondary resale transaction unless such sale is made
pursuant to an exemption from such requirements.

     Each broker-dealer that receives notes for its own account in exchange for
old notes where such notes were acquired by such broker-dealer as a result of
market making activity or other trading activity, must acknowledge that it will
deliver a prospectus meeting the requirements of the Securities Act and that it
has not entered into any arrangement or understanding with us or an affiliate of
ours to distribute the notes in connection with any resale of such notes. See
"Plan of Distribution."

     Upon consummation of the exchange offer, any old notes not tendered will
remain outstanding and continue to accrue interest but, subject to certain
limited exceptions, holders of old notes who do not exchange their old notes for
notes in the exchange offer will no longer be entitled to registration rights
and will not be able to offer or sell their old notes, unless such old notes are
subsequently registered under the Securities Act, except pursuant to an
exemption from, or in a transaction not subject to, the Securities Act and
applicable state securities laws. Subject to limited exceptions, we will have no
obligation to effect a subsequent registration of the old notes.

EXPIRATION DATE; EXTENSIONS; AMENDMENTS; TERMINATION

     The expiration date shall be           , 2004 unless we, in our sole
discretion, extend the exchange offer, in which case the expiration date shall
be the latest date to which the exchange offer is extended.

     To extend the expiration date, we will notify the exchange agent of any
extension by oral or written notice and will notify the holders of old notes by
means of a press release or other public announcement prior to 9:00 a.m., New
York City time, on the next business day after the previously scheduled
expiration date. Such announcement may state that we are extending the exchange
offer for a specified period of time.

     We reserve the right:


     - to delay acceptance of any old notes in the event that the exchange offer
       is extended, to extend the exchange offer or to terminate the exchange
       offer and not accept any old notes for exchange if any of the conditions
       set forth under "-- Conditions" shall have occurred and shall not have
       been waived by us prior to the expiration date; or


     - to amend the terms of the exchange offer in any manner deemed by us to be
       advantageous to the holders of the old notes.


     Any such delay in acceptance, extension, termination or amendment will be
followed as promptly as practicable by oral or written notice to the exchange
agent and we will also notify holders of old notes by means of a press release
or other public announcement. If the exchange offer is amended in a manner


                                        45


determined by us to constitute a material change, we will disclose such
amendment by means of a prospectus supplement.

     Without limiting the manner in which we may choose to make public
announcement of any delay, extension, amendment or termination of the exchange
offer, we shall have no obligations to publish, advertise, or otherwise
communicate any such public announcement, other than by making a timely release
to an appropriate news agency.

INTEREST ON THE NOTES

     The notes will accrue interest at the rate of 9 5/8% per annum from the
last interest payment date on which interest was paid on the old notes
surrendered in exchange therefor or, if no interest has been paid on such old
notes, from the issue date of such old notes, provided, that if old notes are
surrendered for exchange on or after a record date for an interest payment date
that will occur on or after the date of such exchange and as to which interest
will be paid, interest on the new notes received in exchange therefor will
accrue from the date of such interest payment date. Interest on the notes is
payable on June 1 and December 1, beginning on June 1, 2004.

PROCEDURES FOR TENDERING

     To tender in the exchange offer, a holder must complete, sign and date the
letter of transmittal, or a facsimile thereof, have the signatures thereon
guaranteed if required by the letter of transmittal, and mail or otherwise
deliver such letter of transmittal or such facsimile, together with any other
required documents, to the exchange agent prior to 5:00 p.m., New York City
time, on the expiration date. In addition, either:

     - certificates of such old notes must be received by the exchange agent
       along with the letter of transmittal; or

     - a timely confirmation of a book-entry transfer of such old notes, if such
       procedure is available, into the exchange agent's account at the
       book-entry transfer facility, The Depository Trust Company, pursuant to
       the procedure for book-entry transfer described below, must be received
       by the exchange agent prior to the expiration date with the applicable
       letter of transmittal; or

     - the holder must comply with the guaranteed delivery procedures described
       below.

     The method of delivery of old notes, letters of transmittal and all other
required documents is at the election and risk of the noteholders. If such
delivery is by mail, it is recommended that registered mail, properly insured,
with return receipt requested, be used. In all cases, sufficient time should be
allowed to assure timely delivery. No old notes, letters of transmittal or other
required documents should be sent to us. Delivery of all old notes, if
applicable, letters of transmittal and other documents must be made to the
exchange agent at its address set forth in the letter of transmittal. Holders
may also request their respective brokers, dealers, commercial banks, trust
companies or nominees to effect such tender for such holders.

     The tender by a holder of old notes will constitute an agreement between
such holder and us in accordance with the terms and subject to the conditions
set forth herein and in the applicable letter of transmittal. Any beneficial
owner whose old notes are registered in the name of a broker, dealer, commercial
bank, trust company or other nominee and who wishes to tender should contact
such registered holder promptly and instruct such registered holder to tender on
its behalf.


     Signatures on a letter of transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by any member firm of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.,
a commercial bank or trust company having an office or correspondent in the
United States or an "eligible guarantor" institution within the meaning of Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended (referred to in
this prospectus as the "Exchange Act"), or an eligible institution unless the
old notes tendered pursuant thereto are tendered (1) by a registered


                                        46


holder of old notes who has not completed the box entitled "Special Issuance
Instructions" or "Special Delivery Instructions" on the letter of transmittal or
(2) for the account of an eligible institution.

     If a letter of transmittal is signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or others
acting in a fiduciary or representative capacity, such person should so indicate
when signing, and unless waived by us, evidence satisfactory to us of their
authority to so act must be submitted with such letter of transmittal.


     All questions as to the validity, form, eligibility, time of receipt and
withdrawal of the tendered old notes will be determined by us in our sole
discretion, which determination will be final and binding. We reserve the
absolute right to reject any and all old notes not properly tendered or any old
notes which, if accepted, would, in the opinion of counsel for us, be unlawful.
We also reserve the absolute right to waive any irregularities or conditions of
tender as to particular old notes. We will not waive any condition of the offer
with respect to an individual holder unless we waive that condition for all
holders. Our interpretation of the terms and conditions of the exchange offer,
including the instructions in the letter of transmittal, will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of old notes must be cured within such time as we shall
determine. Neither we, the exchange agent nor any other person shall be under
any duty to give notification of defects or irregularities with respect to
tenders of old notes, nor shall any of them incur any liability for failure to
give such notification. Tenders of old notes will not be deemed to have been
made until such irregularities have been cured or waived. Any old note received
by the exchange agent that is not properly tendered and as to which the defects
or irregularities have not been cured or waived will be returned without cost to
such holder by the exchange agent, unless otherwise provided in the letter of
transmittal, promptly following the expiration date.


     In addition, we reserve the right, in our sole discretion, subject to the
provisions of the indenture pursuant to which the notes are issued:

     - to purchase or make offers for any old notes that remain outstanding
       subsequent to the expiration date or, as described under "-- Conditions,"
       to terminate the exchange offer;

     - to redeem old notes as a whole or in part at any time and from time to
       time, as described under "Description of the Notes -- Optional
       Redemption;" and

     - to the extent permitted under applicable law, to purchase old notes in
       the open market, in privately negotiated transactions or otherwise.

     The terms of any such purchases or offers could differ from the terms of
the exchange offer.

ACCEPTANCE OF OLD NOTES FOR EXCHANGE; DELIVERY OF NOTES

     Upon satisfaction or waiver of all of the conditions to the exchange offer,
all old notes properly tendered will be accepted promptly as practicable after
the expiration date, and the notes will be issued promptly as practicable after
acceptance of the old notes. See "-- Conditions." For purposes of the exchange
offer, old notes shall be deemed to have been accepted as validly tendered for
exchange when, as and if we have given oral or written notice thereof to the
exchange agent. For each old note accepted for exchange, the holder of such old
note will receive a new note having a principal amount equal to that of the
surrendered old note.

     In all cases, issuance of notes for old notes that are accepted for
exchange pursuant to the exchange offer will be made only after timely receipt
by the exchange agent of:

     - certificates for such old notes or a timely book-entry confirmation of
       such old notes into the exchange agent's account at the book-entry
       transfer facility;

     - a properly completed and duly executed letter of transmittal; and

     - all other required documents.

                                        47



     If any tendered old notes are not accepted for any reason described in the
terms and conditions of the exchange offer (including the termination or
withdrawal of the exchange offer), such unaccepted or such nonexchanged old
notes will be returned promptly without expense to the tendering holder thereof
(if in certificated form) or credited to an account maintained with such
book-entry transfer facility after the expiration or termination of the exchange
offer.


BOOK-ENTRY TRANSFER

     The exchange agent has established an account with respect to the old notes
at the book-entry transfer facility for purposes of the exchange offer. Any
financial institution that is a participant in the book-entry transfer
facility's systems may make book-entry delivery of old notes by causing the
book-entry transfer facility to transfer such old notes into the exchange
agent's account at the book-entry transfer facility in accordance with such
book-entry transfer facility's procedures for transfer. However, although
delivery of old notes may be effected through book-entry transfer at the
book-entry transfer facility, the letter of transmittal or facsimile thereof
with any required signature guarantees and any other required documents must, in
any case, be transmitted to and received by the exchange agent at the address
set forth in the letter of transmittal on or prior to the expiration date or the
guaranteed delivery procedures described below must be complied with.

EXCHANGING BOOK-ENTRY NOTES

     The exchange agent and the book-entry transfer facility have confirmed that
any financial institution that is a participant in the book-entry transfer
facility may utilize the book-entry transfer facility Automated Tender Offer
Program, or ATOP, procedures to tender old notes.

     Any participant in the book-entry transfer facility may make book-entry
delivery of old notes by causing the book-entry transfer facility to transfer
such old notes into the exchange agent's account in accordance with the
book-entry transfer facility's ATOP procedures for transfer. However, the
exchange for the old notes so tendered will only be made after a book-entry
confirmation of the book-entry transfer of old notes into the exchange agent's
account, and timely receipt by the exchange agent of an agent's message and any
other documents required by the letter of transmittal. The term "agent's
message" means a message, transmitted by the book-entry transfer facility and
received by the exchange agent and forming part of a book-entry confirmation,
which states that the book-entry transfer facility has received an express
acknowledgment from a participant tendering old notes that are the subject of
such book-entry confirmation that such participant has received and agrees to be
bound by the terms of the letter of transmittal, and that we may enforce such
agreement against such participant.

GUARANTEED DELIVERY PROCEDURES

     Holders of old notes whose certificates are not immediately available, or
who are unable to deliver the required confirmations and other documents in a
timely manner on or prior to the expiration date, may effect a tender if:

     - the tender is made through an eligible institution;

     - prior to the expiration date, the exchange agent receives by facsimile
       transmission, mail or hand delivery from such eligible institution a
       properly completed and duly executed letter of transmittal and notice of
       guaranteed delivery, substantially in the form provided by us, which:

        (i) sets forth the name and address of the holder of old notes and the
            amount of old notes tendered;

        (ii) states that the tender is being made thereby; and

        (iii) guarantees that within three New York Stock Exchange, or NYSE,
              trading days after the date of execution of the notice of
              guaranteed delivery, the certificates for all physically tendered
              old notes, in proper form for transfer, or a book-entry
              confirmation, as the case

                                        48


              may be, and any other documents required by the letter of
              transmittal will be deposited by the eligible institution with the
              exchange agent; and

     - the certificates for all physically tendered old notes, in proper form
       for transfer, or a book-entry confirmation, as the case may be, and all
       other documents required by the letter of transmittal are received by the
       exchange agent within three NYSE trading days after the date of execution
       of the notice of guaranteed delivery.

WITHDRAWAL OF TENDERS

     Tenders of old notes may be withdrawn at any time prior to 5:00 p.m., New
York City time, on the expiration date.

     For a withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be received by the exchange agent prior to 5:00 p.m.,
New York City time, on the expiration date at the address set forth in the
letter of transmittal. Any such notice of withdrawal must:

     - specify the name of the person having tendered the old notes to be
       withdrawn;

     - identify the old notes to be withdrawn, including the principal amount of
       such old notes;

     - in the case of old notes tendered by book-entry transfer, specify the
       number of the account at the book-entry transfer facility from which the
       old notes were tendered and specify the name and number of the account at
       the book-entry transfer facility to be credited with the withdrawn old
       notes and otherwise comply with the procedures of such facility;

     - contain a statement that such holder is withdrawing its election to have
       such old notes exchanged;

     - be signed by the holder in the same manner as the original signature on
       the letter of transmittal by which such old notes were tendered,
       including any required signature guarantees, or be accompanied by
       documents of transfer to have the trustee with respect to the old notes
       register the transfer of such old notes in the name of the person
       withdrawing the tender; and

     - specify the name in which such old notes are registered, if different
       from the person who tendered such old notes.

     All questions as to the validity, form, eligibility and time of receipt of
such notice will be determined by us, which determination shall be final and
binding on all parties. Any old notes so withdrawn will be deemed not to have
been validly tendered for exchange for purposes of the exchange offer. Any old
notes which have been tendered for exchange but which are not exchanged for any
reason will be returned to the tendering holder thereof without cost to such
holder, in the case of physically tendered old notes, or credited to an account
maintained with the book-entry transfer facility for the old notes promptly
after withdrawal, rejection of tender or termination of the exchange offer.
Properly withdrawn old notes may be retendered by following one of the
procedures described under "-- Procedures for Tendering" and "-- Book-Entry
Transfer" above at any time on or prior to 5:00 p.m., New York City time, on the
expiration date.

CONDITIONS


     Notwithstanding any other provision of the exchange offer, we shall not be
required to accept for exchange, or to issue notes in exchange for, any old
notes and may terminate or amend the exchange offer if at any time prior to 5:00
p.m., New York City time, on the expiration date, we determine that the exchange
offer violates applicable law or any order of any governmental agency or court
of competent jurisdiction.


     The foregoing conditions are for our sole benefit and may be asserted by us
regardless of the circumstances giving rise to any such condition or may be
waived by us in whole or in part at any time and from time to time in our
reasonable discretion. All such conditions must be satisfied or waived by us, as
applicable, at or before the expiration of the exchange offer.
                                        49


     In addition, we will not accept for exchange any old notes tendered, and no
notes will be issued in exchange for any such old notes, if at such time any
stop order shall be threatened or in effect with respect to the registration
statement of which this prospectus constitutes a part or the qualification of
the indenture under the Trust Indenture Act of 1939, as amended. We are required
to use our reasonable best efforts to obtain the withdrawal of any order
suspending the effectiveness of the registration statement at the earliest
possible time.

EXCHANGE AGENT

     U.S. Bank National Association has been appointed as exchange agent for the
exchange offer. Questions and requests for assistance and requests for
additional copies of this prospectus or of the letter of transmittal should be
directed to the exchange agent as provided in the letter of transmittal.

FEES AND EXPENSES

     The expenses of soliciting tenders pursuant to the exchange offer will be
borne by us. The principal solicitation for tenders pursuant to the exchange
offer is being made by mail; however, additional solicitations may be made by
telegraph, telephone, telecopy or in person by our officers and regular
employees.

     We will not make any payments to brokers, dealers or other persons
soliciting acceptances of the exchange offer. We will, however, pay the exchange
agent reasonable and customary fees for its services and will reimburse the
exchange agent for its reasonable out-of-pocket expenses in connection
therewith. We may also pay brokerage houses and other custodians, nominees and
fiduciaries the reasonable out-of-pocket expenses incurred by them in forwarding
copies of the prospectus and related documents to the beneficial owners of the
old notes, and in handling or forwarding tenders for exchange.

     The expenses to be incurred by us in connection with the exchange offer
will be paid by us, including fees and expenses of the exchange agent and
trustee and accounting, legal, printing and related fees and expenses.

     We will pay all transfer taxes, if any, applicable to the exchange of old
notes pursuant to the exchange offer. If, however, notes or old notes for
principal amounts not tendered or accepted for exchange are to be registered or
issued in the name of any person other than the registered holder of the old
notes tendered, or if tendered old notes are registered in the name of any
person other than the person signing the letter of transmittal, or if a transfer
tax is imposed for any reason other than the exchange of old notes pursuant to
the exchange offer, then the amount of any such transfer taxes imposed on the
registered holder or any other persons will be payable by the tendering holder.
If satisfactory evidence of payment of such taxes or exemption therefrom is not
submitted with the letter of transmittal, the amount of such transfer taxes will
be billed directly to such tendering holder.

CONSEQUENCES OF FAILURE TO EXCHANGE

     Holders of old notes who do not exchange their old notes for notes pursuant
to the exchange offer will continue to be subject to the restrictions on
transfer of such old notes as set forth in the legend thereon as a consequence
of the issuance of the old notes pursuant to exemptions from, or in transactions
not subject to, the registration requirements of the Securities Act and
applicable state securities laws. The old notes may not be offered, sold or
otherwise transferred, except in compliance with the registration requirements
of the Securities Act, pursuant to an exemption from registration under the
Securities Act or in a transaction not subject to the registration requirements
of the Securities Act, and in compliance with applicable state securities laws.
We do not currently anticipate that we will register the old notes under the
Securities Act. To the extent that old notes are tendered and accepted in the
exchange offer, the trading market for untendered and tendered but unaccepted
old notes could be adversely affected.

                                        50


                       DESCRIPTION OF NEW CREDIT FACILITY

     On February 6, 2004, we entered into a loan agreement for a secured
revolving credit facility with Congress Financial Corporation (Canada). The new
credit facility is a three-year revolving credit facility with yearly renewal
options, permitting maximum aggregate borrowings of $20.0 million, subject to a
borrowing base based on the accounts receivable and certain reserves. Borrowings
under the new credit facility are available by U.S. prime rate loans, Canadian
prime rate loans, Libor rate loans and letters of credit. Interest under the
credit facility will be charged on a sliding scale that depends on the manner of
borrowing and the level of excess availability.


     IMAX Corporation is the borrower under the new credit facility, which is
guaranteed by IMAX U.S.A. Inc., IMAX II U.S.A. Inc. and 1329507 Ontario Inc.,
which holds title, as nominee, to the real estate owned by us in Mississauga,
Ontario. The new credit facility is secured by a first priority security
interest in all of the current assets of IMAX Corporation and the aforementioned
guarantors, including IMAX Corporation's ownership interest in its subsidiaries.
Amounts borrowed under the credit facility will constitute secured indebtedness
and will effectively rank senior to the notes to the extent of the value of the
assets securing such indebtedness.


     The new credit facility contains typical affirmative and negative
covenants, including covenants that restrict our ability to:

     - incur certain additional indebtedness;

     - make certain loans, investments or guarantees;

     - pay dividends;

     - make certain asset sales;

     - incur certain liens or other encumbrances;

     - conduct certain transactions with affiliates; and

     - engage in certain consolidation or amalgamation transactions, or
       dissolve.

     In addition, the new credit facility contains customary events of default,
including upon an acquisition or a change of control that has a material adverse
effect on our financial condition.

                                        51


                            DESCRIPTION OF THE NOTES

     Set forth below is a summary of certain provisions of the new notes offered
pursuant to this prospectus (the "Notes"). The Notes will be issued pursuant to
an indenture (the "Indenture"), dated as of December 4, 2003, by and among the
Company, the Guarantors and U.S. Bank National Association, as trustee (the
"Trustee"). The following summaries of certain provisions of the Indenture and
are summaries only, do not purport to be complete and are qualified in their
entirety by reference to all of the provisions of the Indenture. Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to them in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"). Wherever particular provisions of the Indenture are referred to in this
summary, such provisions are incorporated by reference as a part of the
statements made and such statements are qualified in their entirety by such
reference. A copy of the Indenture is filed as an exhibit to the registration
statement of which this prospectus forms a part and may be obtained from the
Trustee upon request. For purposes of this summary, the term "Company" refers
only to IMAX Corporation and not to any of its subsidiaries.

     The form and terms of the Notes are substantially identical to the terms of
the old notes, and evidence the same indebtedness as the old notes, except that
the Notes:

     - will be registered under the Securities Act, and, consequently, will be
       freely tradeable by persons not affiliated with us;

     - will not bear any legend restricting transfer under the Securities Act;

     - will not be entitled to the rights which are applicable to the old notes
       under the registration rights agreement;

     - will not contain provisions relating to the payment of special interest
       under circumstances related to the timing of the exchange offer; and

     - will bear a different CUSIP number from the old notes.

     The Notes will be issued solely in exchange for an equal principal amount
of the old notes. As of the date of this prospectus, $160.0 million aggregate
principal amount of the old notes is outstanding.

GENERAL

     On December 4, 2003, IMAX Corporation issued $160,000,000 aggregate
principal amount of old notes due December 1, 2010. Pursuant to this prospectus,
IMAX Corporation will issue up to $160,000,000 aggregate principal amount of
Notes due December 1, 2010 in the exchange offer.


     The Notes are senior, unsecured, general obligations of the Company,
ranking equally in right of payment with all other senior, unsecured obligations
of the Company. We will initially issue $160.0 million aggregate principal
amount of Notes, which will mature on December 1, 2010. The Indenture provides,
in addition to the $160.0 million aggregate principal amount of Notes issued on
the Issue Date, for the issuance of additional Notes having identical terms and
conditions to the Notes offered hereby (the "Additional Notes"), subject to
compliance with the terms of the Indenture, including the covenant "Limitation
on Incurrence of Additional Indebtedness." The aggregate principal amount of
Notes and Additional Notes will be unlimited in aggregate principal amount
outstanding. Any such Additional Notes would be issued on the same terms as the
Notes and would constitute part of the same series of securities as the Notes
and would vote together as one series on all matters with respect to the Notes.
All references to Notes herein includes the Additional Notes, except as stated
otherwise. The Notes will be issued only in fully registered form, without
coupons, in denominations of $1,000 and integral multiples thereof.


     The term "Subsidiaries," as used herein, does not include Unrestricted
Subsidiaries. As of the date of the Indenture, none of our Subsidiaries were
Unrestricted Subsidiaries. However, under certain circumstances, we will be able
to designate current or future Subsidiaries as Unrestricted Subsidiaries.
Unrestricted Subsidiaries will not be subject to the restrictive covenants set
forth in the Indenture.

                                        52


     The Notes will bear interest at the rate of 9 5/8% per annum from December
4, 2003 or from the most recent Interest Payment Date to which interest has been
paid or provided for, payable semi-annually on June 1 and December 1 of each
year, commencing June 1, 2004, to the persons in whose names such Notes are
registered at the close of business on the May 15 or November 15 immediately
preceding such Interest Payment Date. The Notes will bear interest on overdue
principal and premium, if any, and, to the extent permitted by law, overdue
interest at the rate of 10 5/8% per annum. Interest will be calculated on the
basis of a 360-day year consisting of twelve 30-day months.

     Principal of, premium, if any, and interest on the Notes will be payable,
and the Notes may be presented for registration of transfer or exchange, at the
office or agency of the Company maintained for such purpose, which office or
agency shall be maintained in the Borough of Manhattan, The City of New York,
except as set forth below. At the option of the Company, payment of interest may
be made by check mailed to the Holders of the Notes at the addresses set forth
upon the registry books of the Company. No service charge will be made for any
registration of transfer or exchange of Notes, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. Until otherwise designated by the Company, the
Company's office or agency will be the corporate trust office of the Trustee
presently located at the office of the Trustee in the Borough of Manhattan, The
City of New York.

NOTE GUARANTEES


     The Notes will be guaranteed, jointly and severally, by all of the North
American Subsidiaries of the Company. Each Note Guarantee will be a general
unsecured obligation of the Guarantor and will be equal in right of payment to
any future unsecured, unsubordinated Indebtedness of the Guarantor. The
obligations of each Guarantor under its Note Guarantee will be limited as
necessary to prevent that Note Guarantee from constituting a fraudulent
conveyance under applicable law. See "Risk Factors -- Risks Related to the
Notes -- Applicable statutes allow courts, under specific circumstances, to void
the guarantees of the notes provided by certain of our subsidiaries."


     If the Company or any of its Subsidiaries acquires or creates another North
American Subsidiary on or after the date of the Indenture, then that newly
acquired or created North American Subsidiary must become a Guarantor and
execute a supplemental indenture.


     Subject to compliance with the covenants described under "-- Certain
Covenants -- Limitation on Incurrence of Additional Indebtedness" and
"-- Limitation on Liens Securing Indebtedness" below, the Guarantors can incur,
assume or acquire Indebtedness that will be effectively senior to the Note
Guarantees to the extent of the assets securing such Indebtedness.


OPTIONAL REDEMPTION

     The Company will not have the right to redeem any Notes prior to December
1, 2007. The Notes will be redeemable for cash at the option of the Company, in
whole or in part, at any time on or after December 1, 2007, upon not less than
30 days nor more than 60 days notice to each holder of Notes, at the following
redemption prices (expressed as percentages of the principal amount) if redeemed
during the 12-month period commencing December 1 of the years indicated below,
in each case (subject to the right of Holders of record on a Record Date to
receive interest due but not yet paid on an Interest Payment Date that is on or
prior to such Redemption Date) together with accrued and unpaid interest thereon
to the Redemption Date:



YEAR                                                          PERCENTAGE
- ----                                                          ----------
                                                           
2007........................................................   104.813%
2008........................................................   102.406%
2009 and thereafter.........................................   100.000%


                                        53


     Until December 1, 2006 upon a Qualified Equity Offering, up to 35% of the
aggregate principal amount of the Notes issued pursuant to the Indenture may be
redeemed at the option of the Company within 90 days of such Qualified Equity
Offering, on not less than 30 days, but not more than 60 days, notice to each
Holder of the Notes to be redeemed, with cash from the Net Cash Proceeds of such
Qualified Equity Offering, at 109.625% of the principal amount thereof (subject
to the right of Holders of record on a Record Date to receive interest due but
not yet paid on an Interest Payment Date that is on or prior to such Redemption
Date) together with accrued and unpaid interest thereon to the date of
redemption; provided, however, that immediately following such redemption not
less than 65% of the aggregate principal amount of the Notes issued on the Issue
Date remain outstanding.

     The Company also may, at its option, redeem the Notes, in whole but not in
part, at a redemption price equal to 100% of the principal amount of the Notes,
together with accrued and unpaid interest to the redemption date, if the Company
has become or would become obligated to pay, on the next date on which any
amount would be payable under or with respect to the Notes, any Additional
Amounts as a result of any change in or amendment to the laws (or any
regulations promulgated thereunder) of Canada (or any political subdivision or
taxing authority thereof or therein), or any change in or amendment to any
official position regarding the application or interpretation of such laws or
regulations, which change or amendment is announced or becomes effective on or
after November 19, 2003. See "-- Additional Amounts."

     In the case of a partial redemption, the Trustee shall select the Notes or
portions thereof for redemption on a pro rata basis, by lot or in such other
manner it deems appropriate and fair. The Notes may be redeemed in part in
multiples of $1,000 only.

     The Notes will not have the benefit of any sinking fund.

     Notice of any redemption will be sent, by first class mail, at least 30
days and not more than 60 days prior to the date fixed for redemption to the
Holder of each Note to be redeemed to such Holder's last address as then shown
upon the registry books of the Company. Any notice which relates to a Note to be
redeemed in part only must state the portion of the principal amount equal to
the unredeemed portion thereof and must state that on and after the date of
redemption, upon surrender of such Note, a new Note or Notes in a principal
amount equal to the unredeemed portion thereof will be issued. On and after the
date of redemption, interest will cease to accrue on the Notes or portions
thereof called for redemption, unless the Company defaults in the payment
thereof.

CERTAIN COVENANTS

  OFFER TO REPURCHASE NOTES UPON A CHANGE OF CONTROL

     The Indenture provides that in the event that a Change of Control has
occurred, the Company shall make an irrevocable and unconditional offer (the
"Change of Control Offer") to repurchase all or any part of any Notes then
outstanding (provided, that the principal amount of such Notes must be $1,000 or
an integral multiple thereof) on a date (the "Change of Control Purchase Date")
that is no later than 60 Business Days after the occurrence of such Change of
Control, at a cash price equal to 101% of the principal amount thereof (the
"Change of Control Purchase Price"), together with accrued and unpaid interest
to the Change of Control Purchase Date. The Change of Control Offer shall be
made within 10 Business Days following a Change of Control and shall remain open
for 30 Business Days following its commencement (the "Change of Control Offer
Period"). Upon expiration of the Change of Control Offer Period, the Company
promptly shall purchase all Notes properly tendered in response to the Change of
Control Offer.

     As used herein, a "Change of Control" means (i) any merger, amalgamation or
consolidation of the Company with or into any person or any sale, lease transfer
or other conveyance, whether direct or indirect, of all or substantially all of
the assets of the Company, on a consolidated basis, in one transaction or a
series of related transactions, if, immediately after giving effect to such
transaction(s), any "person" or "group" (as such terms are used for purposes of
Sections 13(d) and 14(d) of the Exchange Act,

                                        54



whether or not applicable) (other than an Excluded Person, which as defined
herein includes Messrs. Bradley J. Wechsler and Richard L. Gelfond, or their
Related Parties) is or becomes the "beneficial owner," directly or indirectly,
of more than 50% of the total voting power in the aggregate normally entitled to
vote in the election of directors, managers, or trustees, as applicable, of the
transferee(s) or surviving entity or entities, (ii) any "person" or "group" (as
such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act, whether or not applicable) (other than an Excluded Person) is or becomes
the "beneficial owner," directly or indirectly, of more than 50% of the total
voting power in the aggregate of all classes of Capital Stock of the Company
then outstanding normally entitled to vote in elections of directors, or (iii)
during any period of 12 consecutive months after the Issue Date, individuals who
at the beginning of any such 12-month period constituted the Board of Directors
of the Company (together with any new directors whose election by such Board or
whose nomination for election by the shareholders of the Company was approved by
a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company then in office.


     On or before the Change of Control Purchase Date, the Company will (i)
accept for payment Notes or portions thereof properly tendered pursuant to the
Change of Control Offer, (ii) deposit with the Paying Agent cash sufficient to
pay the Change of Control Purchase Price (together with accrued and unpaid
interest) of all Notes so tendered and (iii) deliver to the Trustee Notes so
accepted together with an Officers' Certificate listing the Notes or portions
thereof being purchased by the Company. The Paying Agent promptly will pay the
Holders of Notes so accepted an amount equal to the Change of Control Purchase
Price (together with accrued and unpaid interest), and the Trustee promptly will
authenticate and deliver to such Holders a new Note equal in principal amount to
any unpurchased portion (but not including accrued but unpaid interest) of the
Note surrendered. Any Notes not so accepted will be delivered promptly by the
Company to the Holder thereof. The Company publicly will announce the results of
the Change of Control Offer on or as soon as practicable after the Change of
Control Purchase Date.

     The Change of Control purchase feature of the Notes may make more difficult
or discourage a takeover of the Company, and, thus, the removal of incumbent
management.

     The phrase "all or substantially all" of the assets of the Company will
likely be interpreted under applicable state law and will be dependent upon
particular facts and circumstances. As a result, there may be a degree of
uncertainty in ascertaining whether a sale or transfer of "all or substantially
all" of the assets of the Company has occurred.

     No assurance can be given that the Company will have available sufficient
funds to acquire Notes tendered pursuant to a Change of Control Offer. In the
event that the Company is required to purchase outstanding Notes upon the
occurrence of a Change of Control, the Company expects that it would seek third
party financing to the extent that it does not have available funds to meet its
purchase obligations. There can be no assurance that the Company would be able
to obtain such financing.

     Any Change of Control Offer will be made in compliance with all applicable
laws, rules and regulations, including, if applicable, Regulation 14E under the
Exchange Act and the rules thereunder and all other applicable Federal and state
securities laws. To the extent that the provisions of any securities laws or
regulations conflict with the terms hereof, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under the Indenture or the Notes by virtue thereof.

  LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS

     The Indenture provides that, except as set forth in this covenant, the
Company will not, and will not permit any of its Subsidiaries to incur, directly
or indirectly, any Indebtedness (including Acquired Indebtedness) other than
Permitted Indebtedness.

     The immediately preceding paragraph will not prohibit the Company or any
Guarantor from incurring Indebtedness if (i) no Default or Event of Default
shall have occurred and be continuing at the time of, or

                                        55


would occur after giving effect on a pro forma basis to, such incurrence of
Indebtedness and (ii) on the date of incurrence of such Indebtedness (the
"Incurrence Date"), after giving effect on a pro forma basis to such incurrence
and the use of proceeds thereof (including, if applicable, the Investment of
such proceeds in Cash Equivalents), the Consolidated Coverage Ratio of the
Company for the Reference Period immediately preceding the Incurrence Date would
be at least 2.0 to 1.0 (the "Debt Incurrence Ratio").

     For purpose of determining compliance with this covenant, in the event an
item of proposed Indebtedness meets the criteria of more than one of the
categories of Permitted Indebtedness, or is entitled to be incurred pursuant to
the second paragraph of this covenant, the Company will be permitted to classify
such item of Indebtedness on the date of its incurrence and to reclassify such
item of Indebtedness as of the date of such reclassification in any manner that
complies with the Indenture.

  LIMITATION ON RESTRICTED PAYMENTS

     The Indenture provides that the Company will not, and will not permit any
of its Subsidiaries to, directly or indirectly, make any Restricted Payment if,
after giving effect to such Restricted Payment on a pro forma basis, (1) a
Default or an Event of Default shall have occurred and be continuing, (2) the
Company is not permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Debt Incurrence Ratio in the "Limitation on Incurrence of
Additional Indebtedness" covenant, or (3) the aggregate amount of all Restricted
Payments made by the Company and its Subsidiaries, including after giving effect
to such proposed Restricted Payment, from and after the Issue Date, would exceed
the sum of (a) 50% of the aggregate Consolidated Net Income of the Company and
its Subsidiaries for the period (taken as one accounting period), commencing on
the first day of the first full fiscal quarter commencing after the Issue Date,
to and including the last day of the fiscal quarter ended immediately prior to
the date of each such calculation (or, in the event Consolidated Net Income for
such period is a deficit, then minus 100% of such deficit), (b) the aggregate
Net Cash Proceeds received by the Company from the sale of its Qualified Capital
Stock (including Qualified Capital Stock issued upon the exercise of options,
warrants, or rights to purchase Qualified Capital Stock) or options, warrants or
rights to purchase Qualified Capital Stock or of debt securities of the Company
that have been converted into Qualified Capital Stock (other than (i) to a
Subsidiary of the Company or (ii) to the extent applied in connection with a
Qualified Exchange) after the Issue Date, (c) an amount equal to the net
reduction in Investments (including by way of dividends, dispositions or
repayments, or the release of a guarantee constituting a Restricted Payment) by
the Company and its Subsidiaries subsequent to the Issue Date in any
Unrestricted Subsidiary, but only to the extent such amount is not included in
Consolidated Net Income, and (d) $20.0 million.

     The immediately preceding paragraph, however, will not prohibit (w) so long
as no Default or Event of Default shall have occurred and be continuing or
should occur as a consequence thereof, any Refinancing of Indebtedness otherwise
permitted by clause (c) of the definition of "Permitted Indebtedness"; (x) the
repurchase of Capital Stock of the Company or options to purchase Capital Stock
of the Company from employees of the Company or any Subsidiary of the Company
pursuant to the forms of agreements under which employees may purchase or are
granted the option to purchase, shares of Capital Stock of the Company, (y) a
Qualified Exchange, or (z) the payment of any dividend on Capital Stock within
60 days after the date of its declaration if such dividend could have been made
on the date of such declaration in compliance with the foregoing provisions. The
full amount of any payment made pursuant to clauses (x) and (z) (but not
pursuant to clauses (w) or (y)) of the immediately preceding sentence will be
treated as Restricted Payments for purposes of calculating the aggregate amount
of Restricted Payments made pursuant to the immediately preceding paragraph.

  LIMITATION ON DIVIDENDS AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES

     The Indenture provides that the Company will not, and will not permit any
of its Subsidiaries to, directly or indirectly, create, assume or suffer to
exist any consensual restriction on the ability of any Subsidiary of the Company
to pay dividends or make other distributions to or on behalf of, or to pay any
obligation to or on behalf of, or otherwise to transfer assets or property to or
on behalf of, or make or pay loans or advances to or on behalf of, the Company
or any Subsidiary of the Company, except

                                        56


(a) restrictions imposed by the Notes or the Indenture or any other instrument
governing debt securities of the Company incurred in compliance with the
"Limitation on Additional Indebtedness" covenant that are not materially more
restrictive, taken as a whole, than those contained in the Notes and the
Indenture, (b) restrictions imposed by applicable law, (c) existing restrictions
under Indebtedness outstanding on the Issue Date, (d) restrictions under any
Acquired Indebtedness not incurred in violation of the Indenture or any
agreement relating to any property, asset, or business acquired by the Company
or any of its Subsidiaries, which restrictions are not applicable to any person,
other than the person acquired, or to any property, asset or business, other
than the property, assets and business so acquired, (e) any such restriction or
requirement imposed by Indebtedness incurred under paragraph (b) of the
definition of "Permitted Indebtedness" provided such restriction are not
materially more restrictive, taken as a whole, than customary provisions in
comparable financings, (f) restrictions with respect solely to a Subsidiary of
the Company imposed pursuant to a binding agreement which has been entered into
for the sale or disposition of all or substantially all of the Equity Interests
or assets of such Subsidiary, provided such restrictions apply solely to the
Equity Interests or assets of such Subsidiary which are being sold, (g)
customary restrictions on transfers of property contained in any security
agreement (including a Capital Lease Obligation) securing Indebtedness of the
Company or a Subsidiary otherwise permitted under the Indenture, (h) in
connection with and pursuant to permitted Refinancings, replacements of
restrictions imposed pursuant to clauses (a), (c) or (d) of this paragraph that
are not more restrictive than those being replaced and do not apply to any other
person or assets than those that would have been covered by the restrictions in
the Indebtedness so refinanced, and (i) customary limitations on dispositions or
distributions of assets or property that are subject to joint venture agreements
or similar arrangements. Notwithstanding the foregoing, neither (a) customary
provisions restricting subletting or assignment of any lease entered into in the
ordinary course of business, consistent with industry practice, nor (b) Liens
permitted under the terms of the Indenture shall in and of themselves be
considered a restriction on the ability of the applicable Subsidiary to transfer
such agreement or assets, as the case may be.

  LIMITATION ON LIENS SECURING INDEBTEDNESS

     The Indenture provides that the Company will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien of any
kind, other than Permitted Liens, upon any of their respective assets now owned
or acquired on or after the Issue Date or upon any income or profits therefrom,
unless the Company provides, and causes its Subsidiaries to provide,
concurrently therewith, that the Notes are equally and ratably so secured. Any
such Lien thereby created in favor of the Notes will be automatically and
unconditionally released and discharged upon the release and discharge of the
Initial Lien to which it relates.

  LIMITATION ON SALE OF ASSETS


     The Indenture provides that the Company will not, and will not permit any
of its Subsidiaries to, convey, sell, transfer, assign or otherwise dispose of,
directly or indirectly, any of its property, business or assets, including by
merger or consolidation (in the case of a Subsidiary of the Company), and
including any sale or other transfer or issuance of any Equity Interests of any
Subsidiary of the Company, whether by the Company or a Subsidiary or through the
issuance, sale or transfer of Equity Interests by a Subsidiary of the Company,
and including any sale and leaseback transaction, in a single transaction or
through a series of related transactions, for an aggregate consideration net of
out-of-pocket costs relating thereto (including without limitation, legal,
accounting and investment banking fees and sales commissions), in excess of $1.0
million (any of the foregoing, an "Asset Sale"), unless (1) within 12 months
after the date of such Asset Sale, an amount equal to the Net Cash Proceeds
therefrom is (a) applied to the optional redemption of the Notes in accordance
with the terms of the Indenture, (b) applied to the repurchase of the Notes
pursuant to an irrevocable, unconditional cash offer (the "Asset Sale Offer") to
repurchase Notes at a purchase price of 100% of the principal amount thereof
(the "Asset Sale Offer Price") together with accrued and unpaid interest to the
date of payment and to the repurchase or repayment of any Indebtedness that
ranks equally with the Notes that has similar provisions requiring the
repurchase or repayment of such Indebtedness as a result of the Asset Sale;
provided that the offer to repurchase the Notes and the repurchase and repayment
of such other Indebtedness shall be on a

                                        57


pro rata basis based upon the aggregate principal amount of Notes and such other
Indebtedness then outstanding or (c) (i) invested in assets and property (other
than notes, bonds, obligations and securities, except in connection with the
acquisition of a Subsidiary) which in the good faith reasonable judgment of the
Board of Directors will immediately constitute or be a part of a Related
Business of the Company or such Subsidiary (if it continues to be a Subsidiary)
immediately following such transaction or (ii) used to permanently reduce
Indebtedness permitted pursuant to paragraph (b) of the definition "Permitted
Indebtedness" (including that in the case of a revolver or similar arrangement
that makes credit available, such commitment is also permanently reduced by such
amount), (2) at least 75% of the total consideration received for such Asset
Sale or series of related Asset Sales consists of Cash or Cash Equivalents;
provided that the Company and its Subsidiaries may engage in Asset Sales for
consideration not in the form of cash or Cash Equivalents in amounts in excess
of that permitted in this clause (2), so long as (x) such excess consideration
is in the form of Fully Traded Common Stock, (y) the aggregate market value of
such Fully Traded Common Stock received by the Company and its Subsidiaries
(measured as of the date of receipt) from all Asset Sales in reliance on this
proviso since the date of the Indenture that has not been converted into cash or
Cash Equivalents does not exceed $10.0 million and (z) any Fully Traded Common
Stock that is converted into cash or Cash Equivalents shall be applied as
provided in this "Limitation on Sales of Assets" covenant, (3) no Default or
Event of Default shall have occurred and be continuing at the time of, or would
occur after giving effect, on a pro forma basis, to, such Asset Sale, and (4)
the Board of Directors of the Company determines in good faith that the Company
or such Subsidiary, as applicable, receives fair market value for such Asset
Sale.

     The Indenture provides that an acquisition of Notes pursuant to an Asset
Sale Offer may be deferred beyond the 12 month period stipulated in "Limitation
on Sale of Assets" until the accumulated Net Cash Proceeds from Asset Sales not
applied to the uses set forth in clause (1)(b) of the immediately preceding
paragraph (the "Excess Proceeds") exceeds $10.0 million and that each Asset Sale
Offer shall remain open for 20 Business Days following its commencement (the
"Asset Sale Offer Period"). Upon expiration of the Asset Sale Offer Period, the
Company shall apply the Excess Proceeds plus an amount equal to accrued and
unpaid interest to the purchase of all Notes and other Indebtedness properly
tendered (on a pro rata basis if the Excess Proceeds are insufficient to
purchase all Notes and other Indebtedness so tendered) at the Asset Sale Offer
Price (together with accrued interest) or other applicable price for other
Indebtedness. To the extent that the aggregate amount of Notes tendered pursuant
to an Asset Sale Offer and other Indebtedness tendered pursuant to a similar
offer is less than the Excess Proceeds, the Company may use any remaining Net
Cash Proceeds for general corporate purposes as otherwise permitted by the
Indenture and following each Asset Sale Offer the Excess Proceeds amount shall
be reset to zero. For purposes of clause (2) of the immediately preceding
paragraph, total consideration received means the total consideration received
for such Asset Sales minus the amount of (a) Indebtedness which is not
Subordinated Indebtedness assumed by a transferee which assumption permanently
reduces the amount of Indebtedness outstanding on the Issue Date or permitted
pursuant to paragraph (b) of the definition "Permitted Indebtedness" (including
that in the case of a revolver or similar arrangement that makes credit
available, such commitment is so reduced by such amount) and (b) property that
within 30 days of such Asset Sale is converted into Cash or Cash Equivalents.

     The Company and its Subsidiaries may undertake the following actions
without complying with the prior two paragraphs:

          (i) the Company and its Subsidiaries may, in the ordinary course of
     business, convey, sell, transfer, assign or otherwise dispose of inventory,
     receivables and notes receivable acquired and held for resale in the
     ordinary course of business;

          (ii) the sale, lease, transfer or other conveyance of all or
     substantially all of the assets of the Company, on a consolidated basis,
     will be governed by the provisions described under the covenants "Offer to
     Repurchase Notes Upon a Change of Control" and "Limitation on Merger, Sale
     or Consolidation" and not by the provisions of this covenant;

                                        58


          (iii) the Company and its Subsidiaries may sell or dispose of damaged,
     worn out or other obsolete property in the ordinary course of business so
     long as such property is no longer necessary for the proper conduct of the
     business of the Company or such Subsidiary, as applicable;

          (iv) the Company and its Subsidiaries may convey, sell, transfer,
     assign or otherwise dispose of assets to the Company or a Subsidiary;

          (v) the Company and its Subsidiaries may securitize their accounts
     receivable under long term system leases;

          (vi) the Company and its Subsidiaries may simultaneously exchange
     property or assets for other property or assets, provided that the property
     or assets received by the Company or Subsidiary have at least substantially
     equal fair market value to the Company or Subsidiary as the property or
     assets exchanged (as determined by the Board of Directors evidenced by a
     Board Resolution filed with the Trustee) and will immediately constitute or
     be part of a Related Business of the Company or such Subsidiary;

          (vii) a Subsidiary may issue Equity Interests of such Subsidiary;

          (viii) the Company may sell lease, transfer or otherwise convey,
     including by means of a merger or consolidation, all or any part of its
     motion simulation and attractions business, provided that it complies with
     the requirements of clause (4) of the first paragraph of this covenant;

          (ix) the Company and its Subsidiaries may sell or liquidate Cash
     Equivalents; and

          (x) the Company and its Subsidiaries may make Investments in Permitted
     Joint Ventures that qualify as Permitted Investments pursuant to clause (l)
     of the definition of Permitted Investments.

     All Net Cash Proceeds from an Event of Loss shall be invested, used for
prepayment of Indebtedness, or used to repurchase Notes, all within the period
and as otherwise provided above in clause 1(a) or 1(b) of the first paragraph of
this section.

     Any Asset Sale Offer shall be made in compliance with all applicable laws,
rules, and regulations, including, if applicable, Regulation 14E of the Exchange
Act and the rules and regulations thereunder and all other applicable Federal
and state securities laws. To the extent that the provisions of any securities
laws or regulations conflict with the terms hereof, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations hereunder by virtue thereof.

  LIMITATION ON TRANSACTIONS WITH AFFILIATES

     The Indenture provides that neither the Company nor any of its Subsidiaries
will be permitted on or after the Issue Date to enter into or suffer to exist
any contract, agreement, arrangement or transaction with any Affiliate (an
"Affiliate Transaction"), or any series of related Affiliate Transactions,
(other than Exempted Affiliate Transactions) (i) unless it is determined that
the terms of such Affiliate Transaction are fair and reasonable to the Company,
and no less favorable to the Company than could have been obtained in an arm's
length transaction with a non-Affiliate and, (ii) if involving consideration to
either party in excess of $2.0 million, unless such Affiliate Transaction(s) is
evidenced by an Officers' Certificate addressed and delivered to the Trustee
certifying that such Affiliate Transaction(s) has been approved by a majority of
the members of the Board of Directors that are disinterested in such transaction
and (iii) if involving consideration to either party in excess of $10.0 million,
unless in addition the Company, prior to the consummation thereof, obtains a
written favorable opinion as to the fairness of such transaction to the Company
from a financial point of view from an independent investment banking firm of
national reputation in the United States.

  LIMITATION ON MERGER, SALE OR CONSOLIDATION

     The Indenture provides that the Company will not, directly or indirectly,
consolidate or amalgamate with or merge with or into another person or sell,
lease, transfer or otherwise convey all or substantially all of its assets
(computed on a consolidated basis), whether in a single transaction or a series
of related transactions, to another person or group of affiliated persons or
adopt a Plan of Liquidation, unless (i) either (a) the Company is the continuing
entity or (b) the resulting, surviving or transferee entity or,
                                        59


in the case of a Plan of Liquidation, the entity which receives the greatest
value from such Plan of Liquidation is a corporation organized under the laws of
the United States of America, or any state thereof or the District of Columbia,
or Canada or any province or territory thereof and expressly assumes by
supplemental indenture all of the obligations of the Company in connection with
the Notes and the Indenture; (ii) no Default or Event of Default shall exist or
shall occur immediately after giving effect on a pro forma basis to such
transaction; and (iii) immediately after giving effect to such transaction on a
pro forma basis, the consolidated resulting, surviving or transferee entity or,
in the case of a Plan of Liquidation, the entity which receives the greatest
value from such Plan of Liquidation would immediately thereafter be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Debt Incurrence
Ratio set forth in the "Limitation on Incurrence of Additional Indebtedness"
covenant.

     Notwithstanding the previous paragraph, any Subsidiary may consolidate or
amalgamate with, merge into or transfer all or part of its property and assets
to the Company or another Guarantor.

     Upon any consolidation, amalgamation or merger or any transfer of all or
substantially all of the assets of the Company or consummation of a Plan of
Liquidation in accordance with the foregoing, the successor corporation formed
by such consolidation or amalgamation or into which the Company is merged or to
which such transfer is made or, in the case of a Plan of Liquidation, the entity
which receives the greatest value from such Plan of Liquidation shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under the Indenture with the same effect as if such successor
corporation had been named therein as the Company, and the Company shall be
released from the obligations under the Notes and the Indenture except with
respect to any obligations that arise from, or are related to, such transaction.

     For purposes of the foregoing, the transfer (by lease, assignment, sale or
otherwise) of all or substantially all of the properties and assets of one or
more Subsidiaries, the Company's interest in which constitutes all or
substantially all of the properties and assets of the Company shall be deemed to
be the transfer of all or substantially all of the properties and assets of the
Company.

  LIMITATION ON STATUS AS INVESTMENT COMPANY

     The Indenture prohibits the Company and its Subsidiaries from being
required to register as an "investment company" (as that term is defined in the
Investment Company Act of 1940, as amended), or from otherwise becoming subject
to regulation under the Investment Company Act.

  LIMITATION ON SALE AND LEASEBACK TRANSACTIONS

     The Indenture provides that the Company will not, and will not permit any
Subsidiary to, directly or indirectly, enter into any Sale and Leaseback
Transaction unless (a) immediately after giving pro forma effect to such Sale
and Leaseback Transaction (the Attributable Value of such Sale and Leaseback
Transaction being deemed to be Indebtedness of the Company, if not otherwise
treated so pursuant to the definition of Indebtedness), the Company could incur
at least $1.00 of additional Indebtedness pursuant to the Debt Incurrence Ratio
set forth in the covenant "Limitation on Incurrence of Additional Indebtedness,"
(b) such Sale and Leaseback Transaction complies with the covenant "Limitation
on Sale of Assets" and (c) the Company or such Subsidiary could incur a Lien to
secure Indebtedness in the amount of the Attributable Value of the Sale and
Leaseback Transaction without equally and ratably securing the Notes.

  GUARANTEES

     If the Company or any of its Subsidiaries acquires or creates another North
American Subsidiary on or after the date of the Indenture, then that newly
acquired or created North American Subsidiary must become a Guarantor and
execute a supplemental indenture.

     The Company will not permit any of its Subsidiaries, directly or
indirectly, to Guarantee or pledge any assets to secure the payment of any other
Indebtedness of the Company or any Subsidiary thereof, other than Foreign
Subsidiaries, unless such Subsidiary is a Guarantor or simultaneously executes
and delivers a supplemental indenture providing for the Guarantee of the payment
of the Notes by such

                                        60



Subsidiary, which Guarantee shall be senior or equal to such Subsidiary's
Guarantee of such other Indebtedness.


     A Guarantor may not sell or otherwise dispose of all or substantially all
of its assets to, or consolidate with or merge with or into (whether or not such
Guarantor is the surviving person), another person, other than the Company or
another Guarantor, unless:

          (1) immediately after giving effect to that transaction, no Default or
     Event of Default exists; and

          (2) either:

             (a) the person acquiring the property in any such sale or
        disposition or the person formed by or surviving any such consolidation
        or merger (if other than the Guarantor) is a corporation organized or
        existing under the laws of the United States, any state thereof or the
        District of Columbia or Canada or any province or territory thereof and
        assumes all the obligations of that Guarantor under the Indenture, its
        Note Guarantee and the Registration Rights Agreement pursuant to a
        supplemental indenture satisfactory to the Trustee; or

             (b) such sale or other disposition or consolidation or merger
        complies with the covenant described above under the caption
        "-- Limitation on Asset Sales."

     The Note Guarantee of a Guarantor will be released:

          (1) in connection with any sale or other disposition of all of the
     Capital Stock of a Guarantor to a Person that is not (either before or
     after giving effect to such transaction) a Subsidiary of the Company, if
     the sale of all such Capital Stock of that Guarantor complies with the
     covenant described above under the caption "-- Limitation on Assets Sales;"

          (2) if the Company properly designates any Subsidiary that is a
     Guarantor as an Unrestricted Subsidiary under the Indenture; or

          (3) solely in the case of a Note Guarantee created pursuant to the
     second paragraph of this covenant, upon the release or discharge of the
     Guarantee which resulted in the creation of such Note Guarantee pursuant to
     this covenant "-- Guarantees," except a discharge or release by or as a
     result of payment under such Guarantee.

  PAYMENTS FOR CONSENT

     Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of the
Indenture or the Notes unless such consideration is offered to be paid or agreed
to be paid to all Holders of the Notes who so consent, waive or agree to amend
in the time frame set forth in solicitation documents relating to such consent,
waiver or agreement, which solicitation documents will be mailed to all Holders
of the Notes a reasonable amount of time prior to the expiration of such
solicitation.

REPORTS

     The Company will file with the Trustee, to be provided to Holders of Notes,
within 15 days of the required date of filing with the Commission, copies of its
annual and quarterly reports and of the information, documents and reports which
the Company or any Subsidiary is required to file with the Commission pursuant
to Section 13 or 15(d) of the Exchange Act. To the extent that the Company is
not subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company will file with the Commission and provide to the Trustee, to be
provided to the holders of the Notes, at the same time as if it were subject to
such requirements, such annual and quarterly reports and such information,
documents and other reports (or copies of such portions of any of the foregoing
as the Commission may by rules and regulations prescribe) which it would be
required to file with the Commission if it were subject to such requirements.
The Company will also make such reports available to prospective purchasers of
the Notes, securities analysts and broker-dealers upon their request.

                                        61


ADDITIONAL AMOUNTS

     All amounts paid or credited by the Company under or with respect to the
Notes, or by any Guarantor pursuant to its Note Guarantee, will be made free and
clear of and without withholding or deduction for or on account of any present
or future tax, duty, levy, impost, assessment, or other governmental charge
imposed or levied by or on behalf of the Government of Canada or of any province
or territory thereof or by any authority or agency therein or thereof having
power to tax (hereinafter "Taxes"), unless the Company or such Guarantor, as the
case may be, is required to withhold or deduct Taxes by law or by the
interpretation or administration thereof by the relevant government authority or
agency. If the Company or any Guarantor is so required to withhold or deduct any
amount for or on account of Taxes from any payment or credit made under or with
respect to the Notes or Note Guarantees, the Company or such Guarantor will pay
such additional amounts (the "Additional Amounts") as may be necessary so that
the net payment or credit received by each owner of a beneficial interest in the
Notes (including Additional Amounts) after such withholding or deduction will
not be less than the amount the Holder or owner of a beneficial interest in the
Notes would have received if such Taxes had not been withheld or deducted;
provided that no Additional Amounts will be payable with respect to a payment or
credit made to an owner of a beneficial interest in the Notes (i) with whom the
Company does not deal at arm's length (within the meaning of the Income Tax Act
(Canada)) at the time of making such payment or credit, (ii) which is subject to
such Taxes by reason of its being connected with Canada or any province or
territory thereof otherwise than by the mere holding, use or ownership or deemed
holding, use or ownership of the Notes or the receipt of payments or credits or
enforcing any rights thereunder, (iii) which is subject to such Taxes by reason
of its failure to comply with any certification, identification, information,
documentation or other reporting requirement if compliance is required by law,
regulation, administrative practice or an applicable treaty as a precondition to
exemption from, or a reduction in the rate of deduction or withholding of, such
Taxes, (iv) which failed to duly and timely comply with a timely request by the
Company to provide information, documents, certification or other evidence
concerning such Holder's nationality, residence, entitlement to treaty benefits,
identity or connection with Canada or any political subdivision or authority
thereof, if and to the extent that due and timely compliance with such request
could have resulted in the reduction or elimination of any Taxes as to which
Additional Amounts would otherwise have been payable to such Holder of Notes but
for this clause (iv), (v) which is a fiduciary, a partnership or not the
beneficial owner of any payment on a Note, if and to the extent that any
beneficiary or settlor of such fiduciary, any partner of such partnership or the
beneficial owner of such payment (as the case may be) would not have been
entitled to receive Additional Amounts with respect to such payment if such
beneficiary, settlor, partner or beneficial owner had been the Holder of such
Note or (vi) any combination of the foregoing clauses (i) through (v) (in each
case referred to herein as an "Excluded Holder"). The Company or such Guarantor
will also (1) make such withholding or deduction and (2) remit the full amount
deducted or withheld to the relevant authority in accordance with and in the
time required by applicable law. The Company will furnish the Holders of the
Notes, within 30 days after the date the payment of any Taxes is due pursuant to
applicable law, certified copies of tax receipts evidencing such payment by the
Company, if reasonably available. In the event that the Company or such
Guarantor fails to remit any taxes in respect of which Additional Amounts are
payable, the Company or such Guarantor will indemnify and hold harmless each
owner of a beneficial interest in the Notes (other than an Excluded Holder) and
upon written request reimburse such owner of a beneficial interest in the Notes
for the amount of (i) any Taxes levied on and paid by, such owner of a
beneficial interest in the Notes as a result of payment made with respect to the
Notes (including penalties, interest and expenses arising from or with respect
to such Taxes) and (ii) any Taxes (including penalties, interest and expenses
arising from or with respect to such Taxes) imposed with respect to payment of
Additional Amounts or any reimbursement pursuant to this sentence.

     At least 30 days prior to each date on which any payment under or with
respect to the Notes is due and payable, if the Company will be obligated to pay
Additional Amounts with respect to such payments, the Company will deliver to
the Trustee an Officers' Certificate stating the fact that such Additional
Amounts will be payable and the amounts so payable and setting forth such other
information necessary to

                                        62


enable the Trustee to pay such Additional Amounts to Holders or owners of a
beneficial interest in the Notes, as the case may be, on the payment date.

EVENTS OF DEFAULT AND REMEDIES

     The Indenture will define an Event of Default as:

          (i) the failure by the Company to pay any installment of interest on
     the Notes as and when the same becomes due and payable and the continuance
     of any such failure for 30 days,

          (ii) the failure by the Company to pay all or any part of the
     principal, or premium, if any, on the Notes when and as the same becomes
     due and payable at maturity, redemption, by acceleration or otherwise,
     including, without limitation, payment of the Change of Control Purchase
     Price or the Asset Sale Offer Price, or otherwise,

          (iii) the failure by the Company or any Subsidiary to observe or
     perform any other covenant or agreement contained in the Notes or the
     Indenture and the continuance of such failure for a period of 30 days after
     written notice is given to the Company by the Trustee or to the Company and
     the Trustee by the Holders of at least 25% in aggregate principal amount of
     the Notes outstanding (except in the case of a failure to make a Change of
     Control Offer, which shall constitute an Event of Default with such notice
     requirement but without such passage of time requirement),

          (iv) certain events of bankruptcy, insolvency or reorganization in
     respect of the Company or any of its Subsidiaries,

          (v) failure to perform or comply with the provisions described under
     "Limitation on Merger, Sale or Consolidation,"

          (vi) a default in Indebtedness of the Company or any of its
     Subsidiaries with an aggregate principal amount in excess of $10.0 million
     (a) resulting from the failure to pay principal or interest (after any
     applicable grace period) or (b) as a result of which the maturity of such
     Indebtedness has been accelerated prior to its stated maturity,

          (vii) final unsatisfied judgments not covered by insurance aggregating
     in excess of $10.0 million, at any one time rendered against the Company or
     any of its Subsidiaries and not stayed, bonded or discharged within 60
     days, and

          (viii) except as permitted by the Indenture, any Note Guarantee shall
     be held in any judicial proceeding to be unenforceable or invalid or shall
     cease for any reason to be in full force and effect or any Guarantor, or
     any person acting on behalf of any Guarantor, shall deny or disaffirm its
     obligations under its Note Guarantee.

     The Indenture provides that if a Default occurs and is continuing, the
Trustee must, within 90 days after the occurrence of such Default, give to the
Holders notice of such Default.

     If an Event of Default occurs and is continuing (other than an Event of
Default specified in clause (iv) above relating to the Company or any
Subsidiary), then in every such case, unless the principal of all of the Notes
shall have already become due and payable, either the Trustee or the Holders of
25% in aggregate principal amount of the Notes then outstanding, by notice in
writing to the Company (and to the Trustee if given by Holders) (an
"Acceleration Notice"), may declare all principal and premium, if any,
determined as set forth below, and accrued interest thereon to be due and
payable immediately. If an Event of Default specified in clause (iv), above,
relating to the Company or any Subsidiary occurs, all principal and premium, if
any, and accrued interest thereon will be immediately due and payable on all
outstanding Notes without any declaration or other act on the part of the
Trustee or the Holders. The Holders of a majority in aggregate principal amount
of Notes at the time outstanding generally are authorized to rescind such
acceleration if all existing Events of Default, other than the non-payment of
the principal of, premium, if any, and interest on the Notes which have become
due solely by such acceleration, have been cured or waived, except on default
with respect to any provision requiring the approval of the Holder of each
outstanding Note affected to amend.

                                        63


     In the case of any Event of Default occurring by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company with
the intention of avoiding payment of the premium that the Company would have had
to pay if the Company then had elected to redeem the Notes pursuant to the
optional redemption provisions of the Indenture, an equivalent premium shall
also become and be immediately due and payable to the extent permitted by law
upon the acceleration of the Notes.

     Prior to the declaration of acceleration of the maturity of the Notes, the
Holders of a majority in aggregate principal amount of the Notes at the time
outstanding may waive on behalf of all the Holders any default, except a default
with respect to any provision requiring a supermajority approval to amend, which
default may only be waived by such a supermajority, and except a default in the
payment of principal of or interest on any Note not yet cured or a default with
respect to any covenant or provision which cannot be modified or amended without
the consent of the Holder of each outstanding Note affected. Subject to the
provisions of the Indenture relating to the duties of the Trustee, the Trustee
will be under no obligation to exercise any of its rights or powers under the
Indenture at the request, order or direction of any of the Holders, unless such
Holders have offered to the Trustee reasonable security or indemnity. Subject to
all provisions of the Indenture and applicable law, the Holders of a majority in
aggregate principal amount of the Notes at the time outstanding will have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee.

     The Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture and the Company is required, upon
becoming aware of any default or Event of Default, to deliver to the Trustee a
statement specifying such default or Event of Default.

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

     The Indenture provides that the Company may, at its option and at any time,
elect to have its obligations discharged with respect to the outstanding Notes
("Legal Defeasance"). Such Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented, and the
Indenture shall cease to be of further effect as to all outstanding Notes and
all Note Guarantees, except as to (i) rights of Holders to receive payments in
respect of the principal of, premium, if any, and interest on such Notes when
such payments are due from the trust funds; (ii) the Company's obligations with
respect to such Notes concerning issuing temporary Notes, registration of Notes,
mutilated, destroyed, lost or stolen Notes, and the maintenance of an office or
agency for payment and money for security payments held in trust; (iii) the
rights, powers, trust, duties, and immunities of the Trustee, and the Company's
obligations in connection therewith; and (iv) the Legal Defeasance provisions of
the Indenture. In addition, the Company may, at its option and at any time,
elect to have the obligations of the Company released with respect to certain
covenants that are described in the Indenture ("Covenant Defeasance") and
thereafter any omission to comply with such obligations shall not constitute a
Default or Event of Default with respect to the Notes. In the event Covenant
Defeasance occurs, certain events (not including nonpayment of principal,
interest or premium, if any, bankruptcy, receivership, rehabilitation and
insolvency events) described under "Events of Default" will no longer constitute
an Event of Default with respect to the Notes.

     In order to exercise either Legal Defeasance or Covenant Defeasance, (i)
the Company must irrevocably deposit with the Trustee, in trust, for the benefit
of the Holders of the Notes, U.S. legal tender, U.S. Government Obligations or a
combination thereof, in such amounts as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest on such Notes on the stated date for
payment thereof or on the redemption date of such principal or installment of
principal of, premium, if any, or interest on such Notes, and the Holders of
Notes must have a valid, perfected, exclusive security interest in such trust;
(ii) in the case of Legal Defeasance, the Company shall have delivered to the
Trustee an opinion of counsel in the United States reasonably acceptable to the
Trustee confirming that (A) the Company has received from, or there has been
published by the Internal Revenue Service, a ruling or (B) since the date of the
Indenture, there has been a change in the applicable U.S. federal income tax
law, in either case to the effect that, and

                                        64


based thereon such opinion of counsel shall confirm that, the Holders of such
Notes will not recognize income, gain or loss for federal income tax purposes as
a result of such Legal Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred; (iii) in the case of
Covenant Defeasance, the Company shall have delivered to the Trustee an opinion
of counsel in the United States reasonably acceptable to the Trustee confirming
that the Holders of such Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and will be
subject to U.S. federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Covenant Defeasance had
not occurred; (iv) in the case of Legal Defeasance or Covenant Defeasance, the
Company shall have delivered to the Trustee an opinion of counsel in Canada
reasonably acceptable to the Trustee confirming that (A) the Holders of such
Notes will not recognize gain or loss for Canadian federal, provincial or
territorial income tax purposes as a result of such deposit, defeasance or
discharge and will be subject to Canadian federal, provincial and territorial
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such deposit, defeasance and discharge had not
occurred and (B) the interest, principal and other amounts paid or credited in
respect of such Notes will not be subject to Canadian withholding tax as a
result of such deposit, defeasance or discharge; (v) no Default or Event of
Default shall have occurred and be continuing on the date of such deposit or, in
the case of Legal Defeasance insofar as Events of Default from bankruptcy or
insolvency events are concerned, at any time in the period ending on the 91st
day after the date of deposit; (vi) such Legal Defeasance or Covenant Defeasance
shall not result in a breach or violation of, or constitute a default under, the
Indenture or any other material 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; (vii) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Company with
the intent of preferring the holders of such Notes over any other creditors of
the Company or with the intent of defeating, hindering, delaying or defrauding
any other creditors of the Company or others; and (viii) the Company shall have
delivered to the Trustee an Officers' Certificate and an opinion of counsel,
each stating that the conditions precedent provided for in, in the case of the
Officers' Certificate, clauses (i) through (vii) and, in the case of the opinion
of counsel, clauses (i) (with respect to the validity and perfection of the
security interest), (ii), (iii), (iv) and (vi) of this paragraph have been
complied with.

     If the funds deposited with the Trustee to effect Legal Defeasance or
Covenant Defeasance are insufficient to pay the principal of, premium, if any,
and interest on the Notes when due, then the obligations of the Company under
the Indenture will be revived and no such defeasance will be deemed to have
occurred.

AMENDMENTS AND SUPPLEMENTS

     The Indenture contains provisions permitting the Company and the Trustee to
amend the Indenture or enter into a supplemental indenture without the consent
of any Holder to cure any ambiguity, defect or inconsistency in the Indenture;
comply with the provisions described under "Certain Covenants -- Limitation on
Merger, Sale or Consolidation" and "Certain Covenants -- Guarantees"; comply
with the requirements of the SEC in connection with the qualification of the
Indenture under the Trust Indenture Act; evidence and provide for the acceptance
of appointment of a successor Trustee; provide for the issuance of Additional
Notes in accordance with the Indenture; provide for uncertificated Notes in
addition to certificated Notes; comply with the requirements of the Trustee or
the Depositary; or make any change that does not adversely affect the rights of
any Holder in any material respect or that, in the good faith judgment of the
Board of Directors of the Company, would provide any additional benefit or
rights to the Holders. With the consent of the Holders of not less than a
majority in aggregate principal amount of the Notes at the time outstanding, the
Company and the Trustee are permitted to amend or supplement the Indenture or
any supplemental indenture or modify the rights of the Holders. Without the
consent of each Holder affected thereby, the Indenture may not be amended or
supplemented: (i) to change the Stated Maturity on any Note, or reduce the
principal amount thereof or the rate (or extend the time for payment) of
interest thereon or any premium payable upon the redemption thereof, or change
the place of

                                        65


payment where, or the coin or currency in which, any Note or any premium or the
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof (or, in
the case of redemption, on or after the Redemption Date), or reduce the Change
of Control Purchase Price or the Asset Sale Offer Price or alter the provisions
(including the defined terms used therein) regarding the right of the Company to
redeem the Notes in a manner adverse to the Holders, or (ii) to reduce the
percentage in principal amount of the outstanding Notes, the consent of whose
Holders is required for any such amendment, supplemental indenture or waiver
provided for in the Indenture, or (iii) to modify any of the waiver provisions,
except to increase any required percentage or to provide that certain other
provisions of the Indenture cannot be modified or waived without the consent of
the Holder of each outstanding Note affected thereby, or (iv) cause the Notes to
become subordinate in right of payment to any other Indebtedness, or (v) except
in accordance with the Indenture, release any Guarantor from its obligations
under its Note Guarantee.

NO PERSONAL LIABILITY OF PARTNERS, STOCKHOLDERS, OFFICERS, DIRECTORS

     The Indenture provides that no direct or indirect stockholder, employee,
officer or director, as such, past, present or future of the Company or any
successor entity shall have any personal liability in respect of the obligations
of the Company under the Indenture or the Notes by reason of his or its status
as such stockholder, employee, officer or director, except to the extent such
person is the Company.

CERTAIN DEFINITIONS

     "Acquired Indebtedness" means, with respect to a specified person, (i)
Indebtedness or Disqualified Capital Stock of any person existing at the time
such person becomes a Subsidiary of the specified person, including by
designation, or is merged, amalgamated or consolidated into or with the
specified person or one of its Subsidiaries and (ii) Indebtedness secured by a
Lien encumbering any asset at the time such asset is acquired by such specified
person; provided that Acquired Indebtedness shall not include any Indebtedness
incurred or secured in connection with, or in contemplation of, such other
person merging, amalgamating or consolidating with or into or becoming a
Subsidiary of such specified person.

     "Acquisition" means the purchase or other acquisition of any person or
substantially all the assets of any person by any other person, whether by
purchase, merger, amalgamation, consolidation, or other transfer, and whether or
not for consideration.

     "Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For purposes of this definition, the term
"control," as used with respect to any person, means the power to direct the
management and policies of such person, directly or through one or more
intermediaries, whether through the ownership of voting securities, by contract,
or otherwise, provided that beneficial ownership of 10% or more of the total
voting power normally entitled to vote in the election of directors, managers or
trustees, as applicable, of a person shall for such purposes be deemed to
constitute control.

     "Attributable Value" means, as to any particular lease under which any
person is at the time liable other than a Capitalized Lease Obligation, and at
any date as of which the amount thereof is to be determined, the total net
amount of rent required to be paid by such person under such lease during the
remaining term thereof (whether or not such lease is terminable at the option of
the lessee prior to the end of such term), including any period for which such
lease has been, or may, at the option of the lessor, be extended, discounted
from the last date of such term to the date of determination at a rate per annum
equal to the discount rate which would be applicable to a Capitalized Lease
Obligation with a like term in accordance with generally accepted accounting
principles. The net amount of rent required to be paid under any lease for any
such period shall be the aggregate amount of rent payable by the lessee with
respect to such period after excluding amounts required to be paid on account of
insurance, taxes, assessments, utility, operating and labor costs and similar
charges. "Attributable Value" means, as to a Capitalized Lease Obligation under
which any person is at the time liable and at any date as of which the amount
thereof is to be determined, the discounted present value of the rental
obligations of such person, as lessee, required to be capitalized on the balance
sheet of such person in conformity with generally accepted accounting
principles.
                                        66


     "Average Life" means, as of the date of determination, with respect to any
security or instrument, the quotient obtained by dividing (i) the sum of the
products of (a) the number of years from the date of determination to the date
or dates of each successive scheduled principal (or redemption) payment of such
security or instrument and (b) the amount of each such respective principal (or
redemption) payment by (ii) the sum of all such principal (or redemption)
payments.

     "Beneficial Owner" or "beneficial owner" has the meaning attributed to it
in Rules l3d-3 and l3d-5 under the Exchange Act (as in effect on the Issue
Date), whether or not applicable, except that a "person" shall be deemed to have
"beneficial ownership" of all shares that any such person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time.

     "Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York, New York are
authorized or obligated by law or executive order to close.

     "Capital Stock" means (a) with respect to any person that is a corporation,
any and all shares, interests, participations or other equivalents (however
designated and whether or not voting) of corporate stock, including each class
of common stock and preferred stock of such person and (b) with respect to any
person that is not a corporation, any and all partnership, membership or other
equity interests of such person.

     "Capitalized Lease Obligation" means, as applied to any person, any lease
of any property (whether real, personal or mixed) of which the discounted
present value of the rental obligations of such person, as lessee, in conformity
with generally accepted accounting principles, is required to be capitalized on
the balance sheet of such person.

     "Cash Equivalent" means (a) marketable obligations of or obligations
guaranteed by Canada or the United States of America or issued by any agency
thereof and backed by the full faith and credit of the United States of America
or Canada, in each case with a Duration of three years or less, (b) marketable
direct obligations issued by any state of the United States of America, any
province of Canada or any political subdivision thereof having the highest
rating obtainable from either Moody's Investors Service, Inc. ("Moody's"),
Standard & Poor's Ratings Group ("S&P") or Dominion Bond Rating Service, Limited
("DBRS") and having a Duration of three years or less, (c) commercial paper,
bankers acceptances, notes, bonds, debentures, repurchase agreements, call
loans, guaranteed investment certificates and other similar instruments, in each
case having a rating of investment grade by Moody's, S&P or DBRS, and in each
case (other than with respect to commercial paper) having a Duration of three
years or less, (d) certificates of deposit with a Duration of three years or
less issued by United States commercial banks of recognized standing with
capital, surplus and undivided profits aggregating in excess of US$100.0
million, (e) certificates of deposits issued or acceptances accepted by or
guaranteed by a bank to which the Bank Act (Canada) applies or by any company
licensed to carry on the business of a trust company in one or more provinces of
Canada, in each case with capital, surplus and undivided profits aggregating in
excess of Cdn$100.0 million, with a Duration of three years or less, (f) shares
of money market funds that have assets in excess of US$100.0 million and that
invest substantially all of their assets in Cash Equivalents of the kind
described in clauses (a) through (e) above, (g) asset-backed securities rated AA
or higher by Moody's, S&P or DBRS with a Duration of three years or less, and
(h) mortgage-backed securities rated AA or higher by Moody's, S&P or DBRS with a
Duration of 3 years or less; provided that an Investment in (a) through (h) of
this definition shall not be considered to be a Cash Equivalent if, as a result
of giving effect thereto, (A) more than 20% of the aggregate Investments made
pursuant to clauses (a) through (h) of this definition are rated "BBB" or below
or (B) more than 10% of the aggregate Investments made pursuant to clauses (a)
through (h) of this definition are made pursuant to clause (h) of this
definition.

     "Consolidated Coverage Ratio" of any person on any date of determination
(the "Transaction Date") means the ratio, on a pro forma basis, of (a) the
aggregate amount of Consolidated EBITDA of such person (exclusive of amounts
attributable to operations and businesses permanently discontinued or disposed
of) for the Reference Period to (b) the aggregate Consolidated Fixed Charges of
such person

                                        67


(exclusive of amounts attributable to operations and businesses permanently
discontinued or disposed of, but only to the extent that the obligations giving
rise to such Consolidated Fixed Charges would no longer be obligations
contributing to such person's Consolidated Fixed Charges subsequent to the
Transaction Date) during the Reference Period; provided, that for purposes of
such calculation, (i) Acquisitions which occurred during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date shall
be assumed to have occurred on the first day of the Reference Period and any
Operating Expense or Cost Reduction with respect to such Acquisition shall be
accounted for in such calculation, (ii) transactions giving rise to the need to
calculate the Consolidated Coverage Ratio shall be assumed to have occurred on
the first day of the Reference Period, (iii) the incurrence of any Indebtedness
or issuance of any Disqualified Capital Stock during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date (and
the application of the proceeds therefrom to the extent used to refinance or
retire other Indebtedness) shall be assumed to have occurred on the first day of
such Reference Period, and (iv) the Consolidated Fixed Charges of such person
attributable to interest on any Indebtedness or dividends on any Disqualified
Capital Stock bearing a floating interest (or dividend) rate shall be computed
on a pro forma basis as if the average rate in effect from the beginning of the
Reference Period to the Transaction Date had been the applicable rate for the
entire period, unless such person or any of its Subsidiaries is a party to an
Interest Swap and Hedging Obligation (which shall remain in effect for the
12-month period immediately following the Transaction Date) that has the effect
of fixing the interest rate on the date of computation, in which case such rate
(whether higher or lower) shall be used.

     "Consolidated EBITDA" means, with respect to any person, for any period,
the Consolidated Net Income of such person for such period adjusted to add
thereto (to the extent deducted from net revenues in determining Consolidated
Net Income), without duplication, the sum of (i) consolidated income tax
expense, (ii) consolidated depreciation and amortization expense (including any
non-cash charges related to impairment of goodwill, other intangible assets and
film assets, but excluding pre-paid cash expenses that were paid in a prior
period), (iii) other non-recurring non-cash charges of such person and its
Subsidiaries reducing Consolidated Net Income for such period and (iv)
Consolidated Fixed Charges.

     "Consolidated Fixed Charges" of any person means, without duplication, for
any period, as applied to any person, (A) the sum of (a) the aggregate of the
interest expense on Indebtedness of such person and its consolidated
Subsidiaries for such period, on a consolidated basis, including, without
limitation, (i) amortization of debt discount, (ii) the net cost under Interest
Swap and Hedging Obligations (including amortization of discounts), (iii) the
interest portion of any deferred payment obligation and (iv) accrued interest,
plus (b) the interest component of the Capitalized Lease Obligations paid,
accrued and/or scheduled to be paid or accrued by such person and its
consolidated Subsidiaries during such period minus (B) the cash interest income
(exclusive of deferred financing fees) of such person and its consolidated
subsidiaries during such period, in each case as determined in accordance with
generally accepted accounting principles consistently applied.

     "Consolidated Net Income" means, with respect to any person for any period,
the net income (or loss) of such person and its Subsidiaries (determined on a
consolidated basis in accordance with generally accepted accounting principles)
for such period, adjusted to exclude (only to the extent included in computing
such net income (or loss) and without duplication): (a) net gains or losses in
respect of dispositions of assets other than in the ordinary course of business,
(b) any gains or losses from currency exchange transactions not in the ordinary
course of business consistent with past practice, (c) any gains (but not losses)
attributable to any extraordinary items not covered by clause (a) of this
definition, (d) the net income, if positive, of any person, other than a
Subsidiary, in which such person or any of its Subsidiaries has an interest,
except to the extent of the amount of any dividends or distributions actually
paid in cash or Cash Equivalents to such person or a Subsidiary of such person
during such period, but in any case not in excess of such person's pro rata
share of such person's net income for such period, (e) the net income or loss of
any person acquired in a pooling of interests transaction for any period prior
to the date of such acquisition, (f) the net income, if positive, of any of such
person's Subsidiaries to the extent that the declaration or payment of dividends
or similar distributions is not at the time permitted by

                                        68


operation of the terms of its charter or bylaws or any other agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to such Subsidiary, (g) the cumulative effects of accounting changes,
(h) deductions resulting from the amortization of purchase accounting
adjustments (i) any write-offs or write-downs of investments in film assets
existing on the Issue Date and of assets comprising the Company's or its
Subsidiaries' motion simulation and attractions business and (j), for purposes
of the "Limitation on Restricted Payments" covenant, any expense attributable to
warrants, options or rights to purchase Qualified Capital Stock issued in
consideration for goods or services provided to the Company or its Subsidiaries.

     "Credit Agreement" means any credit agreement in existence on or entered
into after the Issue Date, by and among the Company, certain of its
Subsidiaries, certain financial institutions, providing for term loan facilities
and/or revolving credit facilities, including any related notes, guarantees,
collateral documents, instruments and agreements executed in connection
therewith, as such credit agreement and/or related documents may be amended,
restated, supplemented, renewed, replaced or otherwise modified from time to
time whether or not with the same agent, trustee, representative lenders or
holders, and, subject to the proviso to the next succeeding sentence,
irrespective of any changes in the terms and conditions thereof. Without
limiting the generality of the foregoing, the term "Credit Agreement" shall
include agreements in respect of Interest Swap and Hedging Obligations with
lenders (or Affiliates thereof) party to the Credit Agreement and shall also
include any amendment, amendment and restatement, renewal, extension,
restructuring, supplement or modification to any Credit Agreement and all
refundings, refinancings and replacements of any Credit Agreement, including any
credit agreement:

          (1) extending the maturity of any Indebtedness incurred thereunder or
     contemplated thereby,

          (2) adding or deleting borrowers or guarantors thereunder, so long as
     borrowers and issuers include one or more of the Company and its
     Subsidiaries and their respective successors and assigns,

          (3) increasing the amount of Indebtedness incurred thereunder or
     available to be borrowed thereunder; provided, that on the date such
     Indebtedness is incurred it would not be prohibited by the covenant
     "Limitation on Incurrence of Additional Indebtedness," or

          (4) otherwise altering the terms and conditions thereof in a manner
     not prohibited by the terms of the Indenture.

     "Default" means any event, occurrence or condition that is or with the
passage of time or the giving of notice or both would be an Event of Default.

     "Disqualified Capital Stock" means (a) except as set forth in clause (b) of
this definition, with respect to any person, any Equity Interest of such person
that, by its terms or by the terms of any security into which it is convertible,
exercisable or exchangeable, is, or upon the happening of an event or the
passage of time would be, required to be redeemed or repurchased (including at
the option of the holder thereof) by such person or any of its Subsidiaries, in
whole or in part, on or prior to the Stated Maturity of the Notes and (b) with
respect to any Subsidiary of such person (including with respect to any
Subsidiary of the Company), any Equity Interest other than any common equity
with no preference, privileges, or redemption or repayment provisions; provided
that any Equity Interest that would not constitute Disqualified Capital Stock
but for provisions thereof giving holders thereof the right to require such
person to repurchase or redeem such Equity Interest upon the occurrence of an
"asset sale" or "change of control" occurring prior to the Stated Maturity of
the Notes shall not constitute Disqualified Capital Stock if the "asset sale" or
"change of control" provisions applicable to such Equity Interest are no more
favorable to the holders of such Equity Interest than the provisions contained
in "-- Certain Covenants -- Limitations on Sale of Assets" and "-- Certain
Covenants -- Offer to Repurchase Notes Upon a Change of Control" and such Equity
Interest specifically provides that (i) such person will not repurchase or
redeem any such Equity Interest pursuant to such provision prior to the
Company's repurchase of such Notes as are required to be repurchased pursuant to
"-- Certain Covenants -- Limitation on Sale of Assets" and "-- Certain
Covenants -- Offer to Repurchase Notes Upon a Change of Control" and (ii) in the
case of an Asset Sale Offer, such repurchase or redemption shall not exceed such
Excess Proceeds, less the principal amount of Notes tendered in such Asset Sale
Offer.

                                        69


     "Duration" means, with respect to any given financial instrument, (i) the
weighted average of the time to payment of each payment required to be made on a
date certain with respect to such financial instrument, the weights being the
present value of each such payment (calculated at the financial instrument's
yield as of the date of acquisition by the Company or any Subsidiary) as a
percentage of the total present value all such payments (calculated at the
financial instrument's yield as of the date of acquisition by the Company or any
Subsidiary) divided by (ii) one plus the yield (as of the date of acquisition by
the Company or any Subsidiary) of such financial instrument.

     "Equity Interest" of any person means Capital Stock of such person and all
warrants, options or other rights to acquire Capital Stock of such person (but
excluding any debt security that is convertible into, or exchangeable for,
Capital Stock (and which is not otherwise Capital Stock)).

     "Event of Loss" means, with respect to any property or asset, any (i) loss,
destruction or damage of such property or asset or (ii) any condemnation,
seizure or taking, by exercise of the power of eminent domain or otherwise, of
such property or asset, or confiscation or requisition of the use of such
property or asset.

     "Excluded Person" means, Messrs. Bradley J. Wechsler and Richard L.
Gelfond, or their Related Parties.

     "Exempted Affiliate Transaction" means (a) reasonable fees and compensation
paid and indemnity provided pursuant to (including issuances of securities or
other payments, awards or grants in cash, securities or otherwise) customary
employee compensation arrangements (including, without limitation, stock option
and stock ownership plans) approved by a majority of independent (as to such
transactions) members of the Board of Directors of the Company, (b) Restricted
Payments permitted to be made under the Indenture, (c) transactions solely
between the Company and any of its Subsidiaries or solely among Subsidiaries of
the Company, (d) the payment of reasonable and customary fees to and the
provision of indemnity on behalf of directors of the Company who are not
employees of the Company, (e) payments pursuant to any agreement in effect as of
the Issue Date or any amendment thereto or any transaction contemplated thereby
(including pursuant to any amendment thereto) in any replacement agreement
thereto so long as any such amendment or replacement agreement is not more
disadvantageous to the Company or its Subsidiaries, as the case may be, than the
original agreement as in effect on the Issue Date; (f) loans advanced to
employees and officers of the Company and its Subsidiaries not in excess of $1.0
million at any time outstanding; and (g) sales or other transfers of Qualified
Capital Stock.

     "Foreign Subsidiary" means any Subsidiary of the Company that is not a
North American Subsidiary.

     "Fully Traded Common Stock" means common stock issued by any corporation if
(A) such common stock is listed on either The New York Stock Exchange, The
American Stock Exchange, The Toronto Stock Exchange, or is included for trading
privileges in the Nasdaq National Market; and (B) such common stock does not
constitute more than 15% of the issued and outstanding common stock of such
corporation held by Persons other than 10% holders of such common stock and
Affiliates and insiders of such corporation.

     "Generally accepted accounting principles" means, as at any date of
determination, generally accepted accounting principles in the United States and
which are applicable as of the date of determination.

     "Guarantee" means, as to any person, a guarantee other than by endorsement
of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a
pledge of assets or through letters of credit or reimbursement agreements in
respect thereof, of all or any part of any Indebtedness of another person.

     "Guarantors" means:

          (1) each direct or indirect North American Subsidiary of the Company
     on the date of the Indenture; and

          (2) any other Subsidiary that executes a Note Guarantee in accordance
     with the provisions of the Indenture;

                                        70


and their respective successors and assigns until release from their obligations
under their Note Guarantees and the Indenture in accordance with the terms of
the Indenture.

     "incur" shall mean to issue, assume, guaranty, incur, become directly or
indirectly liable with respect to (including as a result of an Acquisition), or
otherwise become responsible for, contingently or otherwise, any Indebtedness
(and, as appropriate, an "incurrence" shall have a correlative meaning).
Notwithstanding the foregoing, the accretion or amortization of original issue
discount and any accruals of interest on any Indebtedness shall not be deemed an
incurrence of Indebtedness.

     "Indebtedness" of any person means, without duplication, (a) all
liabilities and obligations, contingent or otherwise, of such person, to the
extent such liabilities and obligations would appear as a liability upon the
consolidated balance sheet of such person in accordance with generally accepted
accounting principles, (i) in respect of borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such person or only to a
portion thereof), (ii) evidenced by bonds, notes, debentures or similar
instruments, (iii) representing the balance deferred and unpaid of the purchase
price of any property or services, except those incurred in the ordinary course
of its business that would constitute ordinarily a trade payable or account
payable to trade creditors that are not more than 120 days past their original
due date or which are being contested in good faith by appropriate proceeding,
(iv) evidenced by bankers' acceptances or similar instruments issued or accepted
by banks, (v) relating to any Capitalized Lease Obligation, or (vi) evidenced by
a letter of credit or a reimbursement obligation of such person with respect to
any letter of credit; (b) all net obligations of such person under Interest Swap
and Hedging Obligations; (c) all liabilities and obligations of others of the
kind described in the preceding clause (a) or (b) that such person has
guaranteed or that is otherwise its legal liability or which are secured by any
assets or property of such person; (d) any and all deferrals, renewals,
extensions, refinancing and refundings (whether direct or indirect) of, or
amendments, modifications or supplements to, any liability of the kind described
in any of the preceding clauses (a), (b) or (c), or this clause (d), whether or
not between or among the same parties; and (e) all Disqualified Capital Stock of
such person (measured at the greater of its voluntary or involuntary maximum
fixed repurchase price plus accrued and unpaid dividends). For purposes hereof,
the "maximum fixed repurchase price" of any Disqualified Capital Stock which
does not have a fixed repurchase price shall be calculated in accordance with
the terms of such Disqualified Capital Stock as if such Disqualified Capital
Stock were purchased on any date on which Indebtedness shall be required to be
determined pursuant to the Indenture, and if such price is based upon, or
measured by, the fair market value of such Disqualified Capital Stock, such fair
market value to be determined in good faith by the board of directors of the
issuer (or managing general partner of the issuer) of such Disqualified Capital
Stock. Indebtedness shall not include any (1) obligation of any person arising
from the honoring by a bank or other financial institution of a check, draft or
similar instrument inadvertently drawn against insufficient funds in the
ordinary course of business, provided that such obligations are extinguished
within five business days, or (2) liability for federal, provincial, state,
local or other taxes except to the extent otherwise included in the definition
of "Indebtedness." Guarantees of (or obligations with respect to letters of
credit supporting) Indebtedness otherwise included in the determination of the
aggregate amount of Indebtedness incurred shall not also be included in such
determination.

     "Interest Swap and Hedging Obligation" means any obligation of any person
pursuant to any interest rate swap agreement, interest rate cap agreement,
interest rate collar agreement, interest rate exchange agreement, currency
exchange agreement or any other agreement or arrangement designed to protect
against fluctuations in interest rates or currency values, including, without
limitation, any arrangement whereby, directly or indirectly, such person is
entitled to receive from time to time periodic payments calculated by applying
either a fixed or floating rate of interest on a stated notional amount in
exchange for periodic payments made by such person calculated by applying a
fixed or floating rate of interest on the same notional amount.

     "Investment" by any person in any other person means (without duplication)
(a) the acquisition (whether by purchase, merger, consolidation or otherwise) by
such person (whether for cash, property, services, securities or otherwise) of
capital stock, bonds, notes, debentures, partnership or other ownership

                                        71


interests or other securities, including any options or warrants, of such other
person; (b) the making by such person of any deposit with, or advance, loan or
other extension of credit to, such other person (including the purchase of
property from another person subject to an understanding or agreement,
contingent or otherwise, to resell such property to such other person) or any
commitment to make any such advance, loan or extension (but excluding accounts
receivable or deposits arising in the ordinary course of business); (c) other
than guarantees of Indebtedness of the Company to the extent permitted by the
covenant "Limitation on Incurrence of Additional Indebtedness," the entering
into by such person of any guarantee of, or other credit support or contingent
obligation with respect to, Indebtedness or other liability of such other
person; and (d) the making of any capital contribution by such person to such
other person. Any property transferred to an Unrestricted Subsidiary from the
Company or a Subsidiary shall be deemed an Investment valued at its fair market
value at the time of such transfer, provided, however, if in any such case such
fair market value exceeds $1.0 million, such determination of fair market value
shall be certified in an Officer's Certificate.

     "Issue Date" means the date of first issuance of the Notes under the
Indenture.

     "Lien" means any mortgage, charge, pledge, lien (statutory or otherwise),
privilege, security interest, hypothecation or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.

     "Net Cash Proceeds" means the aggregate amount of cash or Cash Equivalents
received by the Company in the case of a sale of Qualified Capital Stock and by
the Company and its Subsidiaries in respect of an Asset Sale or Event of Loss
plus, in the case of an issuance of Qualified Capital Stock upon any exercise,
exchange or conversion of securities (including options, warrants, rights and
convertible or exchangeable debt) of the Company that were issued for cash on or
after the Issue Date, the amount of cash originally received by the Company upon
the issuance of such securities (including options, warrants, rights and
convertible or exchangeable debt) less, in each case, the sum of all payments,
fees, commissions and expenses (including, without limitation, the fees and
expenses of legal counsel and investment banking fees and expenses) incurred in
connection with such Asset Sale, Event of Loss or sale of Qualified Capital
Stock, and, in the case of an Asset Sale only, less the amount (estimated
reasonably and in good faith by the Company) of income, franchise, sales and
other applicable taxes required to be paid by the Company or any of its
respective Subsidiaries in connection with such Asset Sale and amounts required
to be applied to the repayment of Indebtedness secured by a Lien on the asset or
assets that were the subject of such Asset Sale and amounts deemed, in good
faith, appropriate by the Board of Directors of the Company to be provided as a
reserve, in accordance with generally accepted accounting principles, against
any liabilities associated with such assets that are the subject of such Asset
Sale.

     "North American Subsidiary" means any Subsidiary of the Company, as defined
in clauses (i) and (ii) only of the definition of Subsidiary, that was formed
under the laws of the United States or any state of the United States or the
District of Columbia or under the laws of Canada or any province or territory
thereof, excluding Big Frame Theatre Limited Partnership so long as that entity
is not a Subsidiary as defined in clause (i) of the definition of Subsidiary.

     "Operating Expense or Cost Reduction" means with respect to the calculation
of a Consolidated Coverage Ratio, an operating expense or cost reduction with
respect to an Acquisition, which, in the good faith estimate of management, will
be realized as a result of such Acquisition, provided that the foregoing
eliminations of operating expenses and realizations of cost reductions shall be
of the types permitted to be given effect to in accordance with Article 11 of
Regulation S-X under the Exchange Act as in effect on the Issue Date.

     "Permitted Indebtedness" means any of the following:

          (a) Indebtedness of the Company and the Guarantors evidenced by the
     Notes and related Note Guarantees and represented by the Indenture, issued
     on the Issue Date;

          (b) Indebtedness of the Company and its Subsidiaries (including
     pursuant to a Credit Agreement and including any Indebtedness issued to
     refinance, refund or replace such Indebtedness) provided that the aggregate
     principal amount of such Indebtedness outstanding at any time does not

                                        72


     exceed the greater of (a) $30.0 million minus the amount of any such
     Indebtedness retired with Net Cash Proceeds from any Asset Sale or assumed
     by a transferee in an Asset Sale and (b) 15% of Total Assets of the
     Company;

          (c) Refinancing Indebtedness with respect to (i) any Indebtedness
     described in clause (a) of this definition, (ii) incurred under the Debt
     Incurrence Ratio test of the covenant "Limitation on Incurrence of
     Additional Indebtedness," (iii) incurred under this clause (c) or (iv)
     which is outstanding on the Issue Date so long as such Refinancing
     Indebtedness, if secured, is secured only by the assets that secured the
     Indebtedness so refinanced;

          (d) Interest Swap and Hedging Obligations of the Company and its
     Subsidiaries that are incurred for the purpose of fixing or hedging
     interest rate or currency risk of the Company and its Subsidiaries and not
     incurred for the purpose of speculation;

          (e) Indebtedness of the Company and its Subsidiaries solely in respect
     of performance, surety or appeal bonds (to the extent that such incurrence
     does not result in the incurrence of any obligation to repay any obligation
     relating to borrowed money of others), and letters of credit and letters of
     guarantee, all incurred in the ordinary course of business in accordance
     with customary industry practices, in amounts and for the purposes
     customary in the Company's industry;

          (f) Indebtedness of the Company to any Wholly Owned Subsidiary, and
     Indebtedness of a Subsidiary to any other Wholly Owned Subsidiary or to the
     Company; provided that, in the case of Indebtedness of the Company, such
     obligations shall be unsecured and subordinated in all respects to the
     Company's obligations pursuant to the Notes and the date of any event that
     causes such Subsidiary to no longer be a Wholly Owned Subsidiary shall be
     an Incurrence Date;

          (g) Indebtedness of the Company and its Subsidiaries arising from
     agreements providing for indemnification, adjustment of purchase price or
     similar obligations, or from guarantees or letters of credit, surety bonds
     or performance bonds securing any obligations of the Company or any
     Subsidiary pursuant to such agreements, in any case incurred in connection
     with the disposition of any business, assets or Subsidiary, other than
     guarantees of Indebtedness incurred by any person acquiring all or any
     portion of such business, assets or Subsidiary for the purpose of financing
     such acquisition or, in the case of performance bonds, incurred in
     connection with the sale or leasing of systems in the ordinary course of
     business;

          (h) additional Indebtedness of the Company or any Guarantor not to
     exceed $35.0 million in aggregate principal amount at any one time
     outstanding; and

          (i) Indebtedness of the Company and its Subsidiaries existing on the
     Issue Date not to exceed the amount outstanding on such date.

     "Permitted Investment" means (a) Investments in any of the Notes; (b)
Investments in Cash Equivalents; (c) Investments in intercompany notes to the
extent permitted to be incurred under clause (f) of the definition of "Permitted
Indebtedness"; (d) any Investment in a Subsidiary of the Company, any Investment
in the Company so long as the Company receives the proceeds of such Investment,
or any Investment in a person in a Related Business, which, after such
Investment, becomes a Subsidiary of the Company; (e) loans or advances to
employees of the Company or a Subsidiary made in the ordinary course of
business, (f) stock obligations or securities received in settlement of debts
created in the ordinary course of business and owing to the Company or any
Subsidiary or in satisfaction of judgments, (g) Investments received in
connection with an Asset Sale in accordance with the covenant "Limitation on
Sale of Assets," (h) Investments of the Company or any Subsidiary in effect on
the Issue Date, (i) Investments in securities of trade creditors or customers
received pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers, (j) Investments
the payment for which consists exclusively of Qualified Capital Stock of the
Company, (k) other Investments in any Person or Persons, provided, that after
giving pro forma effect to each such Investment, the aggregate amount of all
such Investments made on and after the Issue Date pursuant to this clause (k)
that are outstanding (after giving effect to any such Investments that are
returned to the Company or the Subsidiary that made such prior Investment,
without restriction, in cash

                                        73


or consideration similar to the consideration originally used to make such
Investment on or prior to the date of any such calculation, but only up to the
amount of the Investment made under this clause (k) in such Person) at any time
does not in the aggregate exceed $25.0 million (measured by the value attributed
to the Investment at the time made), and (l) Investments in Permitted Joint
Ventures pursuant to this clause (l), provided that either (1)(i) the Company or
its Subsidiaries have the ability to liquidate their Investment in such
Permitted Joint Venture, without penalty to the Company or its Subsidiaries,
within three years of giving notice of their intention to do so, (ii) in the
good faith opinion of an executive officer of the Company, each of the other
holders of Equity Interests in the Permitted Joint Venture is contributing
consideration to the Permitted Joint Venture in relation to such holder's
economic interest in the Permitted Joint Venture which is at least equal to the
consideration being contributed to the Permitted Joint Venture by the Company or
a Subsidiary in relation to its economic interest in the Permitted Joint Venture
(provided, that in making his or her determination pursuant to this clause (ii),
such executive officer may take into account better than normal profits which
may be derived from the Company's other businesses as a result of such
Investment), and (iii) the Consolidated Coverage Ratio of the Company for the
Reference Period immediately preceding the date of such Investment, after giving
effect on a pro forma basis to such Investment, would be at least 2.0 to 1 or
(2) the Consolidated Coverage Ratio of the Company for the Reference Period
immediately preceding the date of such Investment, after giving effect on a pro
forma basis to such Investment, would be at least 3.0 to 1.

     "Permitted Joint Venture" means any joint venture arrangement (which may be
structured as an unincorporated joint venture, corporation, partnership,
association or limited liability company) (i) in which the Company and its
Subsidiaries own at least 20% but less than 50% of the ownership interest
thereof and (ii) which engages only in a Related Business.

     "Permitted Lien" means (a) Liens created in connection with the incurrence
of Indebtedness permitted by clause (b) of the definition "Permitted
Indebtedness"; (b) Liens existing on the Issue Date; (c) Liens imposed by
governmental authorities for taxes, assessments or other charges not yet subject
to penalty or which are being contested in good faith and by appropriate
proceedings, if adequate reserves with respect thereto are maintained on the
books of the Company in accordance with generally accepted accounting
principles; (d) statutory liens of carriers, warehousemen, mechanics,
materialmen, landlords, repairmen or other like Liens arising by operation of
law in the ordinary course of business provided that (i) the underlying
obligations are not overdue for a period of more than 30 days, or (ii) such
Liens are being contested in good faith and by appropriate proceedings and
adequate reserves with respect thereto are maintained on the books of the
Company in accordance with generally accepted accounting principles; (e) Liens
securing the performance of bids, trade contracts (other than borrowed money),
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
(f) easements, rights-of-way, zoning, similar restrictions and other similar
encumbrances or title defects which, singly or in the aggregate, do not in any
case materially detract from the value of the property subject thereto (as such
property is used by the Company or any of its Subsidiaries) or interfere with
the ordinary conduct of the business of the Company or any of its Subsidiaries;
(g) Liens arising by operation of law in connection with judgments, only to the
extent, for an amount and for a period not resulting in an Event of Default with
respect thereto; (h) pledges or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security legislation; (i) Liens securing the Notes; (j) Liens securing
Indebtedness of a person existing at the time such person becomes a Subsidiary
or is merged with or into the Company or a Subsidiary or Liens securing
Indebtedness incurred in connection with an Acquisition, provided that such
Liens were in existence prior to the date of such acquisition, merger or
consolidation, were not incurred in anticipation thereof, and do not extend to
any assets other than those acquired; (k) leases or subleases granted to other
persons in the ordinary course of business not materially interfering with the
conduct of the business of the Company or any of its Subsidiaries or materially
detracting from the value of the relative assets of the Company or any
Subsidiary; (l) Liens arising from precautionary Uniform Commercial Code
financing statement or similar filings regarding operating leases entered into
by the Company or any of its Subsidiaries in the ordinary course of business;
(m) Liens securing Refinancing Indebtedness incurred to refinance any
Indebtedness that was previously so secured

                                        74


in a manner no more adverse to the Holders of the Notes than the terms of the
Liens securing such refinanced Indebtedness provided that the Indebtedness
secured is not increased and the Lien is not extended to any additional assets
or property, (n) Liens in favor of the Company or any Subsidiary, (o) Liens
securing obligations under Interest Swap and Hedging Obligations permitted to be
incurred under the Indenture, (p) Liens created or deposits made to secure the
performance of tenders, bids, leases, statutory obligations, government
contracts, performance bonds and other obligations of a like nature incurred in
the ordinary course of business, (q) Liens in favor of customs and revenue
authorities, arising as a matter of law to secure payment of customs duties in
connection with the importation of goods and (r) Liens in connection with
securitizations of accounts receivable under long term system leases.

     "Qualified Capital Stock" means any Capital Stock of the Company that is
not Disqualified Capital Stock.

     "Qualified Equity Offering" means any offering of Qualified Capital Stock
of the Company for cash of which the gross proceeds to the Company are at least
$30.0 million.

     "Qualified Exchange" means any legal defeasance, redemption, retirement,
repurchase or other acquisition of Capital Stock or Indebtedness of the Company
with the Net Cash Proceeds received by the Company from the substantially
concurrent sale (other than from or to a Subsidiary or from or to an employee
stock ownership plan financed by loans from the Company or a Subsidiary of the
Company) of Qualified Capital Stock or any exchange of Qualified Capital Stock
for any Capital Stock or Indebtedness of the Company.

     "Reference Period" with regard to any person means the most recently ended
four full fiscal quarters, for which financial statements are available
immediately preceding any date upon which any determination is to be made
pursuant to the terms of the Notes or the Indenture.

     "Refinancing Indebtedness" means Indebtedness or Disqualified Capital Stock
(a) issued in exchange for, or the proceeds from the issuance and sale of which
are used substantially concurrently to repay, redeem, defease, refund,
refinance, discharge or otherwise retire for value, in whole or in part, or (b)
constituting an amendment, modification or supplement to, or a deferral or
renewal ((a) and (b) above are, collectively, a "Refinancing") of any
Indebtedness or Disqualified Capital Stock in a principal amount or, in the case
of Disqualified Capital Stock, liquidation preference, not to exceed (after
deduction of reasonable and customary fees and expenses incurred in connection
with the Refinancing) the (A) lesser of (i) the principal amount or, in the case
of Disqualified Capital Stock, liquidation preference, of the Indebtedness or
Disqualified Capital Stock so Refinanced and (ii) if such Indebtedness being
Refinanced was issued with an original issue discount, the accreted value
thereof (as determined in accordance with generally accepted accounting
principles) at the time of such Refinancing, plus (B) the amount of any premium
required to be paid in connection with such Refinancing pursuant to the terms of
the Indebtedness being so refinanced or the amount of any premium reasonably
determined by the Company as necessary to accomplish such Refinancing by means
of a tender offer or privately negotiated repurchase and plus (C) the expenses
of the Company or the Subsidiary, as the case may be, incurred in connection
with such Refinancing; provided, that (A) such Refinancing Indebtedness of any
Subsidiary of the Company shall only be used to refinance outstanding
Indebtedness or Disqualified Capital Stock of such Subsidiary, (B) such
Refinancing Indebtedness shall (x) not have an Average Life shorter than the
Indebtedness or Disqualified Capital Stock to be so refinanced at the time of
such Refinancing and (y) in all respects, be no less subordinated or junior, if
applicable, to the rights of Holders of the Notes than was the Indebtedness or
Disqualified Capital Stock to be refinanced and (C) such Refinancing
Indebtedness shall have a final stated maturity or redemption date, as
applicable, no earlier than the final stated maturity or redemption date, as
applicable, of the Indebtedness or Disqualified Capital Stock to be so
refinanced.

     "Related Business" means the business conducted (or proposed to be
conducted) by the Company and its Subsidiaries as of the Issue Date and any and
all businesses that in the good faith judgment of the Board of Directors of the
Company are related, similar or ancillary businesses.

                                        75


     "Related Party" means: (1) the spouse or an immediate family member, estate
or heir of Bradley J. Wechsler or Richard L. Gelfond; or (2) any trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners, owners or Persons beneficially holding an 80% or more controlling
interest of which consist of Bradley J. Wechsler, Richard L. Gelfond and/or such
other Persons referred to in the immediately preceding clause (1).

     "Restricted Payment" means, with respect to any person, (a) the declaration
or payment of any dividend or other distribution in respect of Equity Interests
of such person or any parent or Subsidiary of such person, (b) any payment on
account of the purchase, redemption or other acquisition or retirement for value
of Equity Interests of such person or any Subsidiary or direct or indirect
parent of such person (other than any such Equity Interests owned by such person
or any Subsidiary), (c) other than with the proceeds from the substantially
concurrent sale of, or in exchange for, Refinancing Indebtedness, any purchase,
redemption, or other acquisition or retirement for value of, any payment in
respect of any amendment of the terms of or any defeasance of, any Subordinated
Indebtedness, directly or indirectly, by such person or a parent or Subsidiary
of such person prior to the scheduled maturity, any scheduled repayment of
principal, or scheduled sinking fund payment, as the case may be, of such
Indebtedness and (d) any Investment by such person, other than a Permitted
Investment; provided, however, that the term "Restricted Payment" does not
include (i) any dividend, distribution or other payment on or with respect to
Equity Interests of an issuer to the extent payable solely in shares of
Qualified Capital Stock or in options, warrants or other rights to acquire
Qualified Capital Stock of such issuer; or (ii) any dividend, distribution or
other payment to the Company, or to any of its Subsidiaries, by the Company or
any of its Subsidiaries (or, in the case of payment by any non-Wholly Owned
Subsidiary, to any other holder of Equity Interests of such non-Wholly Owned
Subsidiary on a pro rata basis). If (x) the Company or a Subsidiary of the
Company issues, transfers, conveys, leases or otherwise disposes of any shares
of Capital Stock of a Subsidiary of the Company or securities convertible or
exchangeable into, or options, warrants, rights or any other interest with
respect to, Capital Stock of a Subsidiary of the Company, and as a result of
such transaction or as a result of the exercise, conversion or exchange of such
securities, options, warrants, rights or other interest such Subsidiary would
cease to be a Subsidiary, or (y) the Company or a Subsidiary of the Company
issues, transfers, conveys, leases or otherwise disposes of any shares of
Capital Stock or ownership interests of a Permitted Joint Venture which complies
with the provisions of clauses (l)(1)(i) or (l)(2) of the definition of
Permitted Investment or securities convertible or exchangeable into, or options,
warrants, rights or any other interest with respect to, Capital Stock or
ownership interests of a Permitted Joint Venture, or permits such a Permitted
Joint Venture to issue any shares of Capital Stock or ownership interests of
such Permitted Joint Venture or securities convertible or exchangeable into, or
options, warrants, rights or any other interest with respect to Capital Stock of
or ownership interests, in such Permitted Joint Venture, the Company shall be
deemed to have made a Restricted Payment in an amount equal to its net
investment in such Subsidiary or Permitted Joint Venture unless, after giving
effect to such issuance, transfer, conveyance, lease or disposition, the former
Subsidiary shall be or the Permitted Joint Venture shall continue to be, a
Permitted Joint Venture which complies with the provisions of clauses (l)(1)(i)
or (l)(2) of the definition of Permitted Investment.

     "Sale and Leaseback Transaction" of any Person means an arrangement with
any lender or investor or to which such lender or investor is a party providing
for the leasing by such Person of any property or asset of such Person which has
been or is being sold or transferred by such Person more than 90 days after the
acquisition thereof or the completion of construction or commencement of
operation thereof to such lender or investor or to any person to whom funds have
been or are to be advanced by such lender or investor on the security of such
property or asset.

     "Stated Maturity," when used with respect to any Note, means December 1,
2010.

     "Subordinated Indebtedness" means Indebtedness of the Company that is
subordinated in right of payment to the Notes in any respect.

     "Subsidiary" means, with respect to any person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of Capital Stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the

                                        76


time owned or controlled, directly or indirectly, by such person or one or more
of the other Subsidiaries of that person (or a combination thereof), (ii) any
partnership (a) the sole general partner or the managing general partner of
which is such person or a Subsidiary of such person or (b) the only general
partners of which are such person or of one or more Subsidiaries of such person
(or any combination thereof) or (iii) any other person not described in clauses
(i) and (ii) above in which such person, or one more other Subsidiaries of such
person or such person and one or more other Subsidiaries thereof, directly or
indirectly, has a 50% ownership and the power, pursuant to a written contract or
agreement, to direct the policies and management or the financial and other
affairs thereof. Notwithstanding the foregoing, an Unrestricted Subsidiary shall
not be a Subsidiary of the Company or of any Subsidiary of the Company.

     "Total Assets" means, with respect of any person, as of any date, the
consolidated total assets of such person less the amount by which the goodwill
of such person exceeds 10% of total assets of such person, each as determined in
accordance with generally accepted accounting principles.

     "Total Common Equity" of any person means, as of any of determination, the
product of (i) the aggregate number of outstanding primary shares of Capital
Stock of such person on such day (which shall not include any options or
warrants on, or securities convertible or exchangeable into, shares of Capital
Stock of such person) and (ii) the average Closing Price of such Capital Stock
over the 20 consecutive Trading Days immediately preceding such day. If no such
Closing Price exists with respect to shares of any such class, the value of such
shares for purposes of clause (ii) of the preceding sentence shall be determined
by the Board of Directors of the Company in good faith and evidenced by a
resolution of the Board of Directors filed with the Trustee.

     "Unrestricted Subsidiary" means (i) any Subsidiary designated by the Board
of Directors of the Company as an Unrestricted Subsidiary and (ii) any
Subsidiary of an Unrestricted Subsidiary. An Unrestricted Subsidiary may be
designated pursuant to an Officers' Certificate (including any newly acquired or
newly formed Subsidiary) to be an Unrestricted Subsidiary so long as; (i)
neither the Company nor any Subsidiary (a) provides credit support for, or
guarantee of, and Indebtedness of such Subsidiary or any Subsidiary of such
Subsidiary, (including any undertaking or agreement in respect of such debt) or
(b) is directly or indirectly liable for any Indebtedness of such Subsidiary or
any Subsidiary of such Subsidiary, (ii) no default with respect to any
Indebtedness of such Subsidiary or any Subsidiary of such Subsidiary would
permit (upon notice, lapse of time or otherwise) any holder of any other
Indebtedness of the Company of any Subsidiary to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity, (iii) any Investment in such Subsidiary made as a result of
designating such Subsidiary an Unrestricted Subsidiary will not violate the
provisions of the "Limitation on Restricted Payments" covenant, (iv) neither the
Company nor any Subsidiary has a contract, agreement, arrangement, understanding
or obligation of any kind, whether written or oral, with such Subsidiary other
than those that might be obtained at the time from persons who are not
Affiliates of the Company, and (v) neither the Company nor any other Subsidiary,
has any obligation (a) to subscribe for additional Equity Interests in such
Subsidiary, or (b) to maintain or preserve such Subsidiary's financial condition
or to cause such Subsidiary to achieve certain levels of operating results. Any
such designation by the Board of Directors of the Company shall be evidenced to
the Trustee by filing a certified resolution with the Trustee giving effect to
such designation. The Board of Directors of the Company may designate any
Unrestricted Subsidiary as a Subsidiary if, immediately after giving effect to
such designation, there would be no Default or Event of Default under the
Indenture and the Company could incur $1.00 of additional Indebtedness pursuant
to the Debt Incurrence Ratio test under the "Limitation on Incurrence of
Additional Indebtedness" covenant.

     "U.S. Government Obligations" means direct non-callable obligations of the
United States of America for the payment of which the full faith and credit of
the United States is pledged.

     "Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the

                                        77


nearest one-twelfth) that will elapse between such date and the making of such
payment, by (ii) the then outstanding principal amount of such Indebtedness.

     "Wholly Owned Subsidiary" means a Subsidiary all the Equity Interests of
which are owned by the Company or one or more wholly owned Subsidiaries of the
Company.

                                        78


                         BOOK-ENTRY, DELIVERY AND FORM

     Except as set forth below, the Notes (as defined in the section entitled
"Description of the Notes") will be issued in registered, global form in minimum
denominations of $1,000 stated principal amount at maturity and integral
multiples of $1,000 in excess of $1,000. Notes will be issued at the closing of
the exchange offer only against surrender of old notes.

     The Notes initially will be represented by one or more notes in registered,
global form without interest coupons (collectively, the "Global Notes"). The
Global Notes will be deposited upon issuance with the Trustee as custodian for
The Depository Trust Company ("DTC"), in New York, New York, and registered in
the name of DTC or its nominee, in each case for credit to an account of a
direct or indirect participant in DTC as described below. Except as set forth
below, the Global Notes may be transferred, in whole and not in part, only to
another nominee of DTC or to a successor of DTC or its nominee. Beneficial
interests in the Global Notes may not be exchanged for notes in certificated
form except in the limited circumstances described below. See "-- Exchange of
Global Notes for Certificated Notes." Except in the limited circumstances
described below, owners of beneficial interests in the Global Notes will not be
entitled to receive physical delivery of the Notes in certificated form.

     Transfers of beneficial interests in the Global Notes will be subject to
the applicable rules and procedures of DTC and its direct or indirect
participants (including, if applicable, those of the Euroclear System
("Euroclear") and Clearstream Banking, S.A. ("Clearstream"), which may change
from time to time.

DEPOSITORY PROCEDURES

     The following description of the operations and procedures of DTC,
Euroclear and Clearstream are provided solely as a matter of convenience. These
operations and procedures are solely within the control of the respective
settlement systems and are subject to changes by them. The Company takes no
responsibility for these operations and procedures and urges investors to
contact the respective systems or their participants directly to discuss these
matters. DTC has advised the Company that DTC is a limited-purpose trust company
created to hold securities for its participating organizations (collectively,
the "Participants") and to facilitate the clearance and settlement of
transactions in those securities between the Participants through electronic
book-entry changes in accounts of its Participants. The Participants include
securities brokers and dealers (including the initial purchasers of the Notes
(the "Initial Purchasers")), banks, trust companies, clearing corporations and
certain other organizations. Access to DTC's system is also available to other
entities such as banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a Participant, either directly or
indirectly (collectively, the "Indirect Participants"). Persons who are not
Participants may beneficially own securities held by or on behalf of DTC only
through the Participants or the Indirect Participants. The ownership interests
in, and transfers of ownership interests in, each security held by or on behalf
of DTC are recorded on the records of the Participants and Indirect
Participants.

     DTC has also advised the Company that, pursuant to procedures established
by it:

          (1) upon deposit of the Global Notes, DTC will credit the accounts of
     the Participants designated by the Initial Purchasers with portions of the
     principal amount at maturity of the Global Notes; and

          (2) ownership of these interests in the Global Notes will be shown on,
     and the transfer of ownership of these interests will be effected only
     through, records maintained by DTC (with respect to the Participants) or by
     the Participants and the Indirect Participants (with respect to other
     owners of beneficial interest in the Global Notes).

     Investors in the Global Notes who are Participants may hold their interests
therein directly through DTC. Investors in the Global Notes who are not
Participants may hold their interests therein indirectly through organizations
(including Euroclear and Clearstream) which are Participants. All interests in a
Global Note, including those held through Euroclear or Clearstream, may be
subject to the procedures and requirements of DTC. Those interests held through
Euroclear or Clearstream may also be subject to the

                                        79


procedures and requirements of such systems. The laws of some states require
that certain Persons take physical delivery in definitive form of securities
that they own. Consequently, the ability to transfer beneficial interests in a
Global Note to such Persons will be limited to that extent. Because DTC can act
only on behalf of the Participants, which in turn act on behalf of the Indirect
Participants, the ability of a Person having beneficial interests in a Global
Note to pledge such interests to Persons that do not participate in the DTC
system, or otherwise take actions in respect of such interests, may be affected
by the lack of a physical certificate evidencing such interests.

     Except as described below, owners of interests in the Global Notes will not
have notes registered in their names, will not receive physical delivery of
notes in certificated form and will not be considered the registered owners or
"Holders" thereof under the Indenture for any purpose. Payments in respect of
the principal of, and interest and premium, if any, and additional interest, if
any, on a Global Note registered in the name of DTC or its nominee will be
payable to DTC in its capacity as the registered Holder under the Indenture.
Under the terms of the Indenture, the Company and the Trustee will treat the
Persons in whose names the Notes, including the Global Notes, are registered as
the owners of the Notes for the purpose of receiving payments and for all other
purposes. Consequently, neither the Company, the Trustee nor any of the
Company's or the Trustee's agents has or will have any responsibility or
liability for:

          (1) any aspect of DTC's records or any Participant's or Indirect
     Participant's records relating to or payments made on account of beneficial
     ownership interests in the Global Notes or for maintaining, supervising or
     reviewing any of DTC's records or any Participant's or Indirect
     Participant's records relating to the beneficial ownership interests in the
     Global Notes; or

          (2) any other matter relating to the actions and practices of DTC or
     any of its Participants or Indirect Participants.

     DTC has advised us that its current practice, upon receipt of any payment
in respect of securities such as the Notes (including principal and interest),
is to credit the accounts of the relevant Participants with the payment on the
payment date unless DTC has reason to believe it will not receive payment on
such payment date. Each relevant Participant is credited with an amount
proportionate to its beneficial ownership of an interest in the principal amount
at maturity of the relevant security as shown on the records of DTC. Payments by
the Participants and the Indirect Participants to the beneficial owners of Notes
will be governed by standing instructions and customary practices and will be
the responsibility of the Participants or the Indirect Participants and will not
be the responsibility of DTC, the Trustee or the Company. Neither the Company
nor the Trustee will be liable for any delay by DTC or any of the Participants
or the Indirect Participants in identifying the beneficial owners of the Notes,
and the Company and the Trustee may conclusively rely on and will be protected
in relying on instructions from DTC or its nominee for all purposes.

     Transfers between the Participants will be effected in accordance with
DTC's procedures, and will be settled in same-day funds, and transfers between
participants in Euroclear and Clearstream will be effected in accordance with
their respective rules and operating procedures.

     Subject to compliance with the transfer restrictions applicable to the
Notes described herein, crossmarket transfers between the Participants, on the
one hand, and Euroclear or Clearstream participants, on the other hand, will be
effected through DTC in accordance with DTC's rules on behalf of Euroclear or
Clearstream, as the case may be, by their respective depositaries, however, such
crossmarket transactions will require delivery of instructions to Euroclear or
Clearstream, as the case may be, by the counterparty in such system in
accordance with the rules and procedures and within the established deadlines
(Brussels time) of such system. Euroclear or Clearstream, as the case may be,
will, if the transaction meets its settlement requirements, deliver instructions
to its respective depositary to take action to effect final settlement on its
behalf by delivering or receiving interests in the relevant Global Note in DTC,
and making or receiving payment in accordance with normal procedures for
same-day funds settlement applicable to DTC. Euroclear participants and
Clearstream participants may not deliver instructions directly to the
depositories for Euroclear or Clearstream.

                                        80


     DTC has advised us that it will take any action permitted to be taken by a
Holder of Notes only at the direction of one or more Participants to whose
account DTC has credited the interests in the Global Notes and only in respect
of such portion of the aggregate principal amount at maturity of the Notes as to
which such Participant or Participants has or have given such direction.
However, if there is an Event of Default under the Notes, DTC reserves the right
to exchange the Global Notes for legended notes in certificated form, and to
distribute such notes to the Participants.

     Although DTC, Euroclear and Clearstream have agreed to the foregoing
procedures to facilitate transfers of interests in the Global Notes among
participants in DTC, Euroclear and Clearstream, they are under no obligation to
perform or to continue to perform such procedures, and may discontinue such
procedures at any time. Neither the Company nor the Trustee nor any of their
respective agents will have any responsibility for the performance by DTC,
Euroclear or Clearstream or their respective participants or indirect
participants of their respective obligations under the rules and procedures
governing their operations.

EXCHANGE OF GLOBAL NOTES FOR CERTIFICATED NOTES

     A Global Note is exchangeable for definitive notes in registered
certificated form ("Certificated Notes") if:

          (1) DTC (a) notifies the Company that it is unwilling or unable to
     continue as depositary for the Global Notes or (b) has ceased to be a
     clearing agency registered under the Exchange Act and, in either case, the
     Company fails to appoint a successor depositary;

          (2) the Company, at its option, notifies the Trustee in writing that
     it elects to cause the issuance of the Certificated Notes; or

          (3) there has occurred and is continuing a Default or Event of Default
     with respect to the Notes.

     In addition, beneficial interests in a Global Note may be exchanged for
Certificated Notes upon prior written notice given to the Trustee by or on
behalf of DTC in accordance with the Indenture. In all cases, Certificated Notes
delivered in exchange for any Global Note or beneficial interests in Global
Notes will be registered in the names, and issued in any approved denominations,
requested by or on behalf of the depositary (in accordance with its customary
procedures).

EXCHANGE OF CERTIFICATED NOTES FOR GLOBAL NOTES

     Certificated Notes may not be exchanged for beneficial interests in any
Global Note unless the transferor first delivers to the Trustee a written
certificate (in the form provided in the Indenture) to the effect that such
transfer will comply with the appropriate transfer restrictions applicable to
such Notes.

SAME DAY SETTLEMENT AND PAYMENT

     The Company will make payments in respect of the Notes represented by the
Global Notes (including principal, premium, if any, interest and additional
interest, if any) by wire transfer of immediately available funds to the
accounts specified by the Holders of the Global Note. The Company will make all
payments of principal, interest and premium, if any, and additional interest, if
any, with respect to Certificated Notes by wire transfer of immediately
available funds to the accounts specified by the Holders of the Certificated
Notes or, if no such account is specified, by mailing a check to each such
Holder's registered address. All payments will be made in United States dollars.
The Notes represented by the Global Notes are expected to be eligible to trade
in The Portal Market and to trade in DTC's Same-Day Funds Settlement System, and
any permitted secondary market trading activity in such Notes will, therefore,
be required by DTC to be settled in immediately available funds. The Company
expects that secondary trading in any Certificated Notes will also be settled in
immediately available funds.

                                        81


     Because of time zone differences, the securities account of a Euroclear or
Clearstream participant purchasing an interest in a Global Note from a
Participant will be credited, and any such crediting will be reported to the
relevant Euroclear or Clearstream participant, during the securities settlement
processing day (which must be a business day for Euroclear and Clearstream)
immediately following the settlement date of DTC. DTC has advised the Company
that cash received in Euroclear or Clearstream as a result of sales of interests
in a Global Note by or through a Euroclear or Clearstream participant to a
Participant will be received with value on the settlement date of DTC but will
be available in the relevant Euroclear or Clearstream cash account only as of
the business day for Euroclear or Clearstream following DTC's settlement date.

                                        82


                   CERTAIN FEDERAL INCOME TAX CONSIDERATIONS

U.S. FEDERAL INCOME TAX CONSIDERATIONS


     The following is a general discussion of certain U.S. federal income tax
consequences of the acquisition, ownership and disposition of notes by a U.S.
Holder (as defined below). This entire discussion constitutes the opinion of
Shearman & Sterling LLP, United States counsel to IMAX Corporation. The written
opinion of Shearman & Sterling LLP has been filed as an exhibit to the
registration statement of which this prospectus forms a part. The discussion
below applies only to notes held as capital assets, within the meaning of
Section 1221 of the Internal Revenue Code of 1986, as amended, (the "Code"), by
investors who purchase the notes in the offering at the offering price. This
summary is intended for general information only, and does not discuss all of
the tax consequences that may be relevant to a U.S. Holder and does not discuss
the tax consequences applicable to particular classes of U.S. Holders that may
be subject to special tax rules, such as dealers in securities or currencies,
traders in securities that elect mark to market, banks, tax-exempt
organizations, partnerships, S corporations, life insurance companies, persons
that hold notes as part of a hedge, or as part of a straddle or conversion
transaction, taxpayers subject to the alternative minimum tax or whose
functional currency is not the U.S. dollar. This summary also does not address
the tax consequences to shareholders, partners or beneficiaries in any entity
that holds notes. In addition, this summary does not describe any foreign, state
or local tax considerations. Investors who purchase the notes at a price other
than the offering price should consult their tax advisors as to the possible
applicability to them of the amortizable bond premium or market discount rules.
This summary is based on the Code, its legislative history, existing and
proposed U.S. Treasury regulations thereunder, published rulings by the Internal
Revenue Service ("IRS") and court decisions, all as currently in effect and all
subject to change at any time, possibly with retroactive effect.


     YOU SHOULD CONSULT YOUR OWN TAX ADVISORS CONCERNING THE CONSEQUENCES, IN
YOUR PARTICULAR CIRCUMSTANCES, UNDER THE CODE AND THE LAWS OF ANY OTHER TAXING
JURISDICTION, OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF NOTES.

     For the purposes of this summary, a U.S. Holder is a beneficial owner that
is:

     - an individual citizen or resident of the United States for U.S. federal
       income tax purposes;

     - a corporation, or other entity taxable as a corporation, created or
       organized in or under the laws of the United States or of any political
       subdivision of the United States;

     - an estate that is subject to U.S. federal income tax without regard to
       the source of its income; or

     - a trust if (i) a United States court is able to exercise primary
       supervision over administration of the trust and one or more United
       States persons have authority to control all substantial decisions of the
       trust, or (ii) the trust has elected to be treated as a United States
       person under applicable U.S. Treasury regulations.


     The exchange of an old note for a note in the exchange offer will not be a
taxable exchange for U.S. federal income tax purposes. As a result, a U.S.
Holder will not recognize any gain or loss upon exchanging an old note for a
note. The holding period of the note will include the holding period of the old
note exchanged, and the adjusted tax basis of the note received will be the same
as the adjusted tax basis immediately before the exchange of the old note.


     For U.S. federal income tax purposes, interest on a note generally will be
taxable to a U.S. Holder as ordinary income at the time received or accrued, in
accordance with such U.S. Holder's method of accounting for tax purposes. Such
interest will generally constitute foreign source income, and, with certain
exceptions, will be "passive" or "financial services" income for purposes of the
U.S. foreign tax credit.

     Upon the sale or exchange of a note (other than the exchange of an old note
for a note, as described above), a U.S. Holder will recognize gain or loss, if
any, for U.S. federal income tax purposes equal to the difference between the
amount realized on such sale or exchange (other than amounts received that are
attributable to accrued but unpaid interest and taxed as interest) and such U.S.
Holder's adjusted tax basis
                                        83


in the note. Such gain or loss generally will constitute U.S. source capital
gain or loss, and will be long-term capital gain or loss if the note was held by
such U.S. Holder for more than one year. A U.S. Holder's ability to deduct
capital losses against ordinary income is subject to limitations.

     Information reporting of payments of principal and interest within the
United States to non-corporate U.S. Holders generally will be made on Internal
Revenue Service Form 1099, including payments made by wire transfer from outside
the United States to an account in the United States and the payment of proceeds
from the sale of a note effected at a United States office of a broker.

     A U.S. Holder may be subject to backup withholding tax with respect to
interest paid on the notes and to proceeds from the sale, exchange, redemption
or retirement of the note, unless the holder (a) is a corporation or comes
within certain other exempt categories and, when required, demonstrates that
fact or (b) provides a correct taxpayer identification number, certifies that it
has not lost its exemption from backup withholding or has not been notified by
the IRS that it has failed to report any interest or dividends, and otherwise
complies with applicable requirements of the backup withholding rules. A holder
of a note who does not provide us with the holder's correct taxpayer
identification number may be subject to penalties imposed by the IRS.

     Backup withholding is not an additional tax. Any amount paid as backup
withholding will be creditable against the holder's U.S. federal income tax
liability.

CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

     The following summary describes the principal Canadian federal income tax
considerations under the Income Tax Act (Canada) (the "ITA") as of the date of
this prospectus generally applicable to a holder who acquires notes on the
exchange of old notes (the "Exchange") and who, for the purposes of the ITA and
at all relevant times, is not (and is not deemed to be) resident in Canada,
deals at arm's length with IMAX, does not (and is not deemed to) use or hold the
notes in, or in the course of, carrying on a business in Canada, and is not an
insurer that carries on an insurance business in Canada and elsewhere (a
"Holder"). For the purposes of this summary, any reference to notes shall not
include the Additional Notes (as defined in "Description of the Notes").

     This summary is based on the current provisions of the ITA, the regulations
thereunder, all specific proposals to amend the ITA and such regulations
publicly announced by or on behalf of the Minister of Finance (Canada) prior to
the date hereof (which amendments this summary presumes are enacted in their
current form), and IMAX's understanding of the published administrative
practices of the Canada Customs and Revenue Agency. This summary does not
otherwise take into account any change in law or administrative practice,
whether by judicial, governmental, legislative or administrative action, nor
does it take into account provincial, territorial or foreign income tax
consequences, which may vary from the Canadian federal income tax considerations
described herein.

     THIS SUMMARY IS OF A GENERAL NATURE ONLY AND IS NOT, AND SHOULD NOT BE
INTERPRETED AS, LEGAL OR TAX ADVICE TO ANY PARTICULAR HOLDER AND NO
REPRESENTATION IS MADE WITH RESPECT TO THE CANADIAN FEDERAL INCOME TAX
CONSEQUENCES TO ANY PARTICULAR HOLDER. ACCORDINGLY, HOLDERS OF NOTES SHOULD
CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THEIR PARTICULAR CIRCUMSTANCES.

     Under the ITA, the payment by IMAX of interest, principal or premium (if
any) on the notes to a Holder will be exempt from Canadian withholding tax, and
no other taxes on income (including taxable capital gains) under the ITA will be
payable by a Holder in respect of the Exchange, ownership or disposition of the
notes.

                                        84


                              PLAN OF DISTRIBUTION

     Each broker-dealer that receives notes for its own account pursuant to the
exchange offer must acknowledge that it will deliver a prospectus in connection
with any resale of such notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of notes received in exchange for old notes where the old notes
were acquired as a result of market-making activities or other trading
activities. We have agreed that, for a period of 180 days after the expiration
date of the exchange offer, we will make this prospectus, as amended or
supplemented, available to any broker-dealer for use in connection with any such
resale.

     We will not receive any proceeds from any sale of notes by broker-dealers.
Notes received by broker-dealers for their own account pursuant to the exchange
offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on the notes or a combination of those methods of resale, at market
prices prevailing at the time of resale, at prices related to prevailing market
prices or negotiated prices. Any resale may be made directly to purchasers or to
or through brokers or dealers who may receive compensation in the form of
commissions or concessions from any such broker-dealer or the purchasers of any
of the notes. Any broker-dealer that resells notes that were received by it for
its own account pursuant to the exchange offer and any broker or dealer that
participates in a distribution of the notes may be deemed to be an "underwriter"
within the meaning of the Securities Act and any profit on any resale of notes
and any commissions or concessions received by any such persons may be deemed to
be underwriting compensation under the Securities Act. The letter of transmittal
states that, by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

     For a period of 180 days after the expiration date of the exchange offer,
we will promptly send a reasonable amount of additional copies of this
prospectus and any amendment or supplement to this prospectus to any
broker-dealer that is entitled to use such documents and that requests such
documents in the letter of transmittal. We have agreed to pay all expenses
incident to the exchange offer other than commissions or concessions of any
brokers or dealers and will indemnify the holders of the notes (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act. We note, however, that in the opinion of the SEC,
indemnification against liabilities under federal securities laws is against
public policy and may be unenforceable.

     The notes have not been and will not be qualified for distribution under
the securities laws of any province or territory of Canada and are being offered
and sold in Canada only in reliance on available prospectus exemptions.

                                 LEGAL MATTERS

     Certain United States legal matters in connection with the validity of the
notes and the accompanying guarantees will be passed upon for us by Shearman &
Sterling LLP, Toronto, Ontario and New York, New York. We have been advised as
to certain Canadian legal matters by McCarthy Tetrault LLP, Toronto, Ontario and
New York, New York.

                                    EXPERTS

     The financial statements as of December 31, 2001 and 2002 and for each of
the three years in the period ended December 31, 2002 incorporated by reference
into this prospectus have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.

                                        85


                      WHERE YOU CAN FIND MORE INFORMATION


     We file annual reports, quarterly reports, proxy statements and other
information with the SEC under the Exchange Act. You may read and copy this
information, or obtain copies of the information by mail, at the following
location of the SEC:


                             Public Reference Room
                             450 Fifth Street, N.W.
                                   Room 1024
                              Washington, DC 20549

     You may obtain information on the operation of the Public Reference Room by
calling the SEC at 1-800-SEC-0330.

     The SEC also maintains a web site that contains reports, proxy statements
and other information about issuers, like IMAX, who file electronically with the
SEC. The address of the site is www.sec.gov.

     In addition, we are subject to the filing requirements prescribed by the
securities legislation of all Canadian provinces. These filings are available
electronically from the Canadian System for Electronic Document Analysis and
Retrieval at www.sedar.com, which is commonly known by the acronym "SEDAR."

     We are "incorporating by reference" into this prospectus certain
information contained in documents we file with the SEC, which means that we are
disclosing important information to you by referring you to those documents. The
information incorporated by reference is deemed to be part of this prospectus.
The following information and documents, which have been filed by us with the
SEC, are incorporated by reference into this prospectus:


     - annual report on Form 10-K for the fiscal year ended December 31, 2003;


     - definitive proxy statement on Schedule 14A, dated April 30, 2003; and


     - current report on Form 8-K, dated March 11, 2004.



     All documents that we file with the SEC under Sections 13(a), 13(c), 14 and
15(d) of the Exchange Act from the date of this prospectus to 180 days after the
completion of the exchange offer shall also be deemed to be incorporated by
reference into and will automatically update information in this prospectus.
Current reports on Form 8-K containing only Regulation FD disclosure furnished
pursuant to Item 9 of Form 8-K or disclosure regarding a completed quarterly or
annual fiscal period furnished pursuant to Item 12 of Form 8-K shall not be
deemed to be incorporated by reference into this prospectus except to the extent
we specifically state in such Form 8-K that the disclosure in such report is to
be incorporated by reference into this prospectus.


     Any statement made in this prospectus or in a document incorporated or
deemed to be incorporated by reference into this prospectus will be deemed to be
modified or superseded for purposes of this prospectus to the extent that a
statement contained in any other subsequently filed document that is also
incorporated or deemed to be incorporated by reference into this prospectus
modifies or supersedes the original statement. Any statement so modified or
superseded will not be deemed, except as so modified or superseded, to
constitute a part of this prospectus.

     You may request a copy of these filings, at no cost, by writing or calling
us at the following address or telephone number:

        G. Mary Ruby
        Senior Vice President, Legal Affairs and Corporate Secretary
        IMAX Corporation
        2525 Speakman Drive
        Sheridan Park
        Mississauga, Ontario, L5K 1B1
        Tel: (905) 403-6500
                                        86


     Exhibits to the filings will not be sent unless those exhibits have
specifically been incorporated by reference into this prospectus.

     Except as provided above, no other information, including information on
our website, is incorporated by reference into this prospectus.

                                        87


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                                  (IMAX LOGO)


                                    PART II

                   INFORMATION NOT REQUIRED IN THE PROSPECTUS

ITEM 20.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Section 124 of the Canada Business Corporations Act ("CBCA") and Section 7
of the IMAX Corporation's By-Law No. 1 provide for the indemnification of
directors and officers of the IMAX Corporation (the "Corporation"). Under these
provisions, the Corporation shall indemnify a director or officer of the
Corporation (or a former director or officer) against all costs, charges and
expenses, including amounts paid to settle an action or satisfy a judgment,
reasonably incurred by such director or officer in respect of any civil,
criminal or administrative action or proceeding (other than in respect of an
action by or on behalf of the Corporation to procure a judgment in its favor) to
which such individual is made a party by reason of his position with the
Corporation, if he fulfills the following two conditions: (a) he acted honestly
and in good faith with a view to the best interests of the Corporation; and (b)
in the case of a criminal or administrative action or proceeding that is
enforced by a monetary penalty, he had reasonable grounds for believing that his
conduct was lawful. In respect of an action by or on behalf of the Corporation
to procure a judgment in its favor, the Corporation, with the approval of a
court, may indemnify a director or officer of the Corporation (or a former
director or officer) against all costs, charges and expenses reasonably incurred
by him in connection with such action if he fulfills the conditions set out in
clauses (a) and (b) of the previous sentence. Notwithstanding the foregoing, a
director or officer of the Corporation (or a former director or officer) is
entitled to indemnification from the Corporation in respect of all costs,
charges and expenses reasonably incurred by him in connection with the defense
of any civil, criminal or administrative action or proceeding to which he is
made a party by reason of his position with the Corporation if he was not judged
by the court or other competent authority to have committed any fault or omitted
to do anything that the individual ought to have done and he fulfills the
conditions in clauses (a) and (b) of the second sentence of this paragraph.

     Section 7.4 of IMAX Corporation's By-Law No. 1 also provides that, to the
extent permitted by law, no director or officer for the time being of the
Corporation shall be liable for the acts, receipts, neglects or defaults of any
other director or officer or employee or for joining in any receipt or act for
conformity or for any loss, damage or expense happening to the Corporation
through the insufficiency or deficiency of title to any property acquired by the
Corporation or for or on behalf of the Corporation or for the insufficiency or
deficiency of any security in or upon which any of the moneys of or belonging to
the Corporation shall be placed out or invested or for any loss or damage
arising from the bankruptcy, insolvency or tortious act of any person, firm or
body corporate with whom or which any moneys, securities or other assets
belonging to the Corporation shall be lodged or deposited or for any loss,
conversion, misapplication or misappropriation of or any damage resulting from
any dealings with any moneys, securities or other assets belonging to the
Corporation or for any other loss, damage or misfortune whatever which may
happen in the execution of the duties of his respective office or trust or in
relation thereto unless the same shall happen by or through his failure to act
honestly and in good faith with a view to the best interests of the Corporation
and in connection therewith to exercise the care, diligence and skill that a
reasonably prudent person would exercise in comparable circumstances.

     The Corporation maintains directors' and officers' liability insurance
subject to deductibles in respect of SEC claims and claims for wrongful acts
against insured persons.

ITEM 21.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

     (a) Exhibits

     See the index to exhibits that appears immediately following the signature
pages of this registration statement.

     (b) Financial Statement Schedules

                                       II-1


     Financial Statement Schedule II- Valuation and Qualifying Accounts for each
year in the three-year period ended December 31, 2002, incorporated by reference
to IMAX Corporation's Form 10-K for the year ended December 31, 2002, file no.
000-24216.

ITEM 22.  UNDERTAKINGS

     The undersigned registrants hereby undertake:

          (1) That for purposes of determining any liability under the
     Securities Act of 1933, as amended (the "Securities Act"), each filing of
     the registrants' annual report, as applicable, pursuant to Section 13(a) or
     Section 15(d) of the Securities Exchange Act of 1934, as amended (the
     "Exchange Act"), (and, where applicable, each filing of an employee benefit
     plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
     incorporated by reference in this registration statement shall be deemed to
     be a new registration statement relating to the securities offered therein,
     and the offering of such securities at that time shall be deemed to be the
     initial bona fide offering thereof.

          (2) To respond to requests for information that is incorporated by
     reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this
     form within one business day of receipt of such request, and to send the
     incorporated documents by first class mail or other equally prompt means.
     This includes information contained in documents filed subsequent to the
     effective date of this registration statement through the date of
     responding to the request.

          (3) To supply by means of a post-effective amendment all information
     concerning a transaction, and the company being acquired involved therein,
     that was not the subject of and included in this registration statement
     when it became effective.

     Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Corporation, pursuant to the provisions described in Item 20 above, or
otherwise, the Corporation has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that the claim for indemnification against such liabilities (other
than the payment by the Corporation of expenses incurred or paid by a director,
officer or controlling person of the Corporation in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Corporation will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

                                       II-2


                                   SIGNATURES


     Pursuant to the requirements of the Securities Act, each registrant has
duly caused this amendment no. 1 to the registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
Toronto, Province of Ontario, on May 4, 2004.


                                  IMAX CORPORATION
                                  1329507 ONTARIO INC.

                                  3D SEA II LTD.

                                  924689 ONTARIO INC.
                                  DAVID KEIGHLEY PRODUCTIONS 70MM INC.
                                  IMAX (TITANIC) INC.
                                  IMAX (TITANICA) LTD.
                                  IMAX CHICAGO THEATRE LLC,
                                    BY ITS MANAGING MEMBER IMAX THEATRE
                                    HOLDING (CALIFORNIA I) CO.
                                  IMAX FILM HOLDING CO.
                                  IMAX FORUM RIDE, INC.
                                  IMAX II U.S.A. INC.
                                  IMAX INDIANAPOLIS LLC
                                  IMAX MINNESOTA HOLDING CO.
                                  IMAX MUSIC LTD.
                                  IMAX PICTURES CORPORATION
                                  IMAX PROVIDENCE GENERAL PARTNER CO.
                                  IMAX PROVIDENCE LIMITED PARTNER CO.
                                  IMAX RHODE ISLAND LIMITED PARTNERSHIP,
                                    BY ITS GENERAL PARTNER IMAX PROVIDENCE
                                    GENERAL PARTNER CO.
                                  IMAX SANDDE ANIMATION INC.
                                  IMAX SCRIBE INC.
                                  IMAX SPACE LTD.
                                  IMAX THEATRE HOLDING (BROSSARD) INC.
                                  IMAX THEATRE HOLDING (CALIFORNIA I) CO.
                                  IMAX THEATRE HOLDING (CALIFORNIA II) CO.
                                  IMAX THEATRE HOLDING (NYACK I) CO.
                                  IMAX THEATRE HOLDING (NYACK II) CO.
                                  IMAX THEATRE HOLDING CO.
                                  IMAX THEATRE HOLDINGS (OEI) INC.
                                  IMAX THEATRE MANAGEMENT (SCOTTSDALE), INC.
                                  IMAX THEATRE MANAGEMENT COMPANY
                                  IMAX THEATRE SERVICES LTD.
                                  IMAX U.S.A. INC.
                                  IMMERSIVE ENTERTAINMENT INC.
                                  MIAMI THEATRE LLC,
                                    BY ITS MANAGING MEMBER IMAX THEATRE
                                    HOLDING (CALIFORNIA I) CO.
                                  MITEY CINEMA INC.
                                  MOUNTAINVIEW THEATRE MANAGEMENT LTD.
                                  NYACK THEATRE LLC,
                                    BY ITS MANAGING MEMBER IMAX THEATRE
                                    HOLDING (NYACK I) CO.
                                  PANDA PRODUCTIONS INC.
                                  RIDEFILM CORPORATION

                                       II-3


                                  RPM PICTURES LTD.
                                  SACRAMENTO THEATRE LLC,
                                    BY ITS MANAGING MEMBER IMAX THEATRE
                                    HOLDING (CALIFORNIA I) CO.
                                  SONICS ASSOCIATES, INC.
                                  STARBOARD THEATRES LTD.
                                  STRATEGIC SPONSORSHIP CORPORATION
                                  TANTUS FILMS LTD.
                                  TANTUS II FILMS LTD.

                                  TAURUS-LITTROW PRODUCTIONS INC.

                                  WIRE FRAME FILMS LTD.

                                  By:            /s/ G. MARY RUBY
                                     -------------------------------------------
                                      Name: G. Mary Ruby
                                      Title: Corporate Secretary

                                  By:           /s/ EDWARD MACNEIL
                                     -------------------------------------------
                                      Name: Edward MacNeil

                                      Title: Vice President



                                       II-4




     Pursuant to the requirements of the Securities Act, this amendment no. 1 to
the registration statement has been signed by the following persons in the
following capacities, including each registrant's principal executive officer or
officers, its principal financial officer and its controller or principal
accounting officer, on May 4, 2004.



                                                 
*                                                   Co-Chairman and Co-Chief Executive Officer and
- ------------------------------------------------    Director of IMAX Corporation
Richard L. Gelfond

                                                    Director of IMAX Providence General Partner Co.,
                                                    IMAX Providence Limited Partner Co., IMAX Theatre
                                                    Holding (California I) Co., IMAX Theatre Holding
                                                    (California II) Co., IMAX Theatre Holding (Nyack
                                                    I) Co., IMAX Theatre Holding (Nyack II) Co., IMAX
                                                    Theatre Holding Co., IMAX Theatre Holdings (OEI),
                                                    Inc., IMAX Theatre Management Company, Ridefilm
                                                    Corporation and Sonics Associates Inc.

                                                    President of IMAX Chicago Theatre LLC, IMAX
                                                    Providence General Partner Co., IMAX Providence
                                                    Limited Partner Co., IMAX Rhode Island Limited
                                                    Partnership, IMAX Space Ltd., IMAX Theatre
                                                    Holding (California I) Co., IMAX Theatre Holding
                                                    (California II) Co., IMAX Theatre Holding (Nyack
                                                    I) Co., IMAX Theatre Holding (Nyack II) Co., IMAX
                                                    Theatre Holding Co., IMAX Theatre Holdings (OEI)
                                                    Inc., IMAX Theatre Management Company, Miami
                                                    Theatre LLC, Mitey Cinema Inc., Nyack Theatre LLC
                                                    and Sacramento Theatre LLC

                                                    Chairman of Sonics Associates, Inc.

                                                    Treasurer of Ridefilm Corporation

/s/ BRADLEY J. WECHSLER                             Co-Chairman and Co-Chief Executive Officer and
- ------------------------------------------------    Director of IMAX Corporation
Bradley J. Wechsler

                                                    Director of Ridefilm Corporation and Sonics
                                                    Associates Inc.

                                                    President of 924689 Ontario Inc., IMAX (Titanic)
                                                    Inc., IMAX (Titanica) Ltd., IMAX Film Holding
                                                    Co., IMAX II U.S.A. Inc., IMAX Minnesota Holding
                                                    Co., IMAX Pictures Corporation, IMAX Theatre
                                                    Management (Scottsdale), Inc., IMAX Theatre
                                                    Services Ltd., IMAX U.S.A. Inc., Immersive
                                                    Entertainment Inc., Mountainview Theatre
                                                    Management Ltd., Panda Productions Inc.,
                                                    Starboard Theatres Ltd., Strategic Sponsorship
                                                    Corporation and Taurus-Littrow Productions Inc.

*                                                   Director of IMAX Corporation
- ------------------------------------------------
Neil S. Braun

*                                                   Director of IMAX Corporation
- ------------------------------------------------
Kenneth G. Copland

*                                                   Director of IMAX Corporation
- ------------------------------------------------
Michael Fuchs

*                                                   Director of IMAX Corporation
- ------------------------------------------------
Garth M. Girvan




                                       II-5


                                                 
*                                                   Director of IMAX Corporation
- ------------------------------------------------
David W. Leebron

*                                                   Director of IMAX Corporation
- ------------------------------------------------
Marc A. Utay

/s/ FRANCIS T. JOYCE                                Chief Financial Officer of IMAX Corporation
- ------------------------------------------------
Francis T. Joyce

                                                    Vice President, Finance of 1329507 Ontario Inc.,
                                                    3D Sea II Ltd., 924689 Ontario Inc., David
                                                    Keighley Productions 70mm Inc., IMAX (Titanic)
                                                    Inc., IMAX (Titanica) Ltd., IMAX Chicago Theatre
                                                    LLC, IMAX Film Holding Co., IMAX Forum Ride,
                                                    Inc., IMAX II U.S.A. Inc., IMAX Minnesota Holding
                                                    Co., IMAX Music Ltd., IMAX Pictures Corporation,
                                                    IMAX, Providence General Partner Co., IMAX
                                                    Providence Limited Partner Co., IMAX Rhode Island
                                                    Limited Partnership, IMAX Sandde Animation Inc.,
                                                    IMAX Scribe Inc., IMAX Space Ltd., IMAX Theatre
                                                    Holding (Brossard) Inc., IMAX Theatre Holding
                                                    (California I) Co., IMAX Theatre Holding
                                                    (California II) Co., IMAX Theatre Holding (Nyack
                                                    I) Co., IMAX Theatre Holding (Nyack II) Co., IMAX
                                                    Theatre Holding Co., IMAX Theatre Holdings (OEI)
                                                    Inc., IMAX Theatre Management (Scottsdale), Inc.,
                                                    IMAX Theatre Management Company, IMAX Theatre
                                                    Services Ltd., IMAX U.S.A. Inc., Immersive
                                                    Entertainment Inc., Miami Theatre LLC, Mitey
                                                    Cinema Inc., Mountainview Theatre Management
                                                    Ltd., Nyack Theatre LLC, Panda Productions Inc.,
                                                    Ridefilm Corporation, RPM Pictures Ltd.,
                                                    Sacramento Theatre LLC, Sonics Associates, Inc.,
                                                    Starboard Theatres Ltd., Strategic Sponsorship
                                                    Corporation, Tantus Films Ltd., Tantus II Films
                                                    Ltd., Taurus-Littrow Productions Inc. and Wire
                                                    Frame Films Ltd.

*                                                   Vice President, Finance and Controller of IMAX
- ------------------------------------------------    Corporation
Kathryn A. Gamble

/s/ ROBERT D. LISTER                                Executive Vice President, Business and Legal
- ------------------------------------------------    Affairs & General Counsel of IMAX Corporation
Robert D. Lister

                                                    Director of Sonics Associates Inc.

                                                    President of IMAX Forum Ride, Inc.

                                                    Vice President of 1329507 Ontario Inc., 3D Sea II
                                                    Ltd., David Keighley Productions 70mm Inc., IMAX
                                                    Indianapolis LLC, IMAX Music Ltd., IMAX Sandde
                                                    Animation Inc., IMAX Scribe Inc., IMAX Theatre
                                                    Holding (Brossard) Inc., RPM Pictures Ltd.,
                                                    Tantus Films Ltd., Tantus II Films Ltd.,
                                                    Taurus-Littrow Productions Inc., and Wire Frame
                                                    Films Ltd.




                                       II-6


                                                 
/s/ G. MARY RUBY                                    Senior Vice President, Legal Affairs, Deputy
- ------------------------------------------------    General Counsel and Corporate Secretary of IMAX
G. Mary Ruby                                        Corporation

                                                    Director of 1329507 Ontario Inc., 3D Sea II Ltd.,
                                                    924689 Ontario Inc., David Keighley Productions
                                                    70mm Inc., IMAX (Titanic) Inc., IMAX (Titanica)
                                                    Ltd., IMAX Film Holding Co., IMAX Forum Ride,
                                                    Inc., IMAX II U.S.A. Inc., IMAX Indianapolis LLC,
                                                    IMAX Minnesota Holding Co., IMAX Music Ltd., IMAX
                                                    Pictures Corporation, IMAX Sandde Animation Inc.,
                                                    IMAX Space Ltd., IMAX Theatre Holding (Brossard)
                                                    Inc., IMAX Theatre Management (Scottsdale), Inc.,
                                                    IMAX Theatre Services Ltd., IMAX U.S.A. Inc.,
                                                    Immersive Entertainment Inc., Mitey Cinema Inc.,
                                                    Mountainview Theatre Management Ltd., Panda
                                                    Productions Inc., RPM Pictures Ltd., Starboard
                                                    Theatres Ltd., Strategic Sponsorship Corporation,
                                                    Tantus Films Ltd., Tantus II Films Ltd.,
                                                    Taurus-Littrow Productions Inc. and Wire Frame
                                                    Films Ltd.

                                                    Corporate Secretary of 1329507 Ontario Inc., 3D
                                                    Sea II Ltd., 924689 Ontario Inc., David Keighley
                                                    Productions 70mm Inc., IMAX (Titanic) Inc., IMAX
                                                    (Titanica) Ltd., IMAX Film Holding Co., IMAX
                                                    Forum Ride, Inc., IMAX II U.S.A. Inc., IMAX
                                                    Indianapolis LLC, IMAX Minnesota Holding Co.,
                                                    IMAX Music Ltd., IMAX Pictures Corporation, IMAX
                                                    Providence General Partner Co., IMAX Providence
                                                    Limited Partner Co., IMAX Sandde Animation Inc.,
                                                    IMAX Scribe Inc., IMAX Space Ltd., IMAX Theatre
                                                    Holding (Brossard) Inc., IMAX Theatre Holding
                                                    (California I) Co., IMAX Theatre Holding
                                                    (California II) Co., IMAX Theatre Holding (Nyack
                                                    I) Co., IMAX Theatre Holding (Nyack II) Co., IMAX
                                                    Theatre Holding Co., IMAX Theatre Holdings (OEI)
                                                    Inc., IMAX Theatre Management (Scottsdale), Inc.,
                                                    IMAX Theatre Management Company, IMAX Theatre
                                                    Services Ltd., IMAX U.S.A. Inc., Immersive
                                                    Entertainment Inc., Mitey Cinema Inc.,
                                                    Mountainview Theatre Management Ltd., Panda
                                                    Productions Inc., Ridefilm Corporation, RPM
                                                    Pictures Ltd., Sonics Associates, Inc., Starboard
                                                    Theatres Ltd., Strategic Sponsorship Corporation,
                                                    Tantus Films Ltd., Tantus II Films Ltd.,
                                                    Taurus-Littrow Productions Inc. and Wire Frame
                                                    Films Ltd.




                                       II-7


                                                 
/s/ EDWARD MACNEIL                                  Vice President of 1329507 Ontario Inc., 3D Sea II
- ------------------------------------------------    Ltd., 924689 Ontario Inc., David Keighley
Edward MacNeil                                      Productions 70mm Inc., IMAX (Titanic) Inc., IMAX
                                                    (Titanica) Ltd., IMAX Film Holding Co., IMAX
                                                    Forum Ride, Inc., IMAX II U.S.A. Inc., IMAX
                                                    Indianapolis LLC, IMAX Minnesota Holding Co.,
                                                    IMAX Music Ltd., IMAX Pictures Corporation, IMAX,
                                                    Providence General Partner Co., IMAX Providence
                                                    Limited Partner Co., IMAX Sandde Animation Inc.,
                                                    IMAX Scribe Inc., IMAX Space Ltd., IMAX Theatre
                                                    Holding (Brossard) Inc., IMAX Theatre Holding
                                                    (California I) Co., IMAX Theatre Holding
                                                    (California II) Co., IMAX Theatre Holding (Nyack
                                                    I) Co., IMAX Theatre Holding (Nyack II) Co., IMAX
                                                    Theatre Holding Co., IMAX Theatre Holdings (OEI)
                                                    Inc., IMAX Theatre Management (Scottsdale), Inc.,
                                                    IMAX Theatre Management Company, IMAX Theatre
                                                    Services Ltd., IMAX U.S.A. Inc., Immersive
                                                    Entertainment Inc., Mitey Cinema Inc.,
                                                    Mountainview Theatre Management Ltd., Panda
                                                    Productions Inc., Ridefilm Corporation, RPM
                                                    Pictures Ltd., Sonics Associates, Inc., Starboard
                                                    Theatres Ltd., Strategic Sponsorship Corporation,
                                                    Tantus Films Ltd., Tantus II Films Ltd.,
                                                    Taurus-Littrow Productions Inc. and Wire Frame
                                                    Films Ltd.

*                                                   President of IMAX Scribe Inc.
- ------------------------------------------------
Greg Foster

*                                                   President of David Keighley Productions 70mm Inc.
- ------------------------------------------------
David B. Keighley


*By: /s/ G. MARY RUBY
- ------------------------------------------------
     G. Mary Ruby, as Attorney-in-fact




                                       II-8


                           AUTHORIZED REPRESENTATIVE


     Pursuant to the requirements of Section 6(a) of the Securities Act, the
authorized representative of IMAX Corporation and each of the other registrants
has duly caused this amendment no. 1 to the registration statement to be signed
on its behalf by the undersigned, solely in it capacity as the duly authorized
representative of the registrants in the United States, in the City of New York,
State of New York, on May 4, 2004.


                                          IMAX U.S.A. INC.

                                          By:     /s/ ROBERT D. LISTER
                                            ------------------------------------
                                              Name: Robert D. Lister
                                              Title:   Vice President

                                          By:     /s/ FRANCIS T. JOYCE
                                            ------------------------------------
                                              Name: Francis T. Joyce

                                              Title:   Vice President of Finance



                                       II-9




                                 EXHIBIT INDEX





EXHIBIT
 NUMBER                           DOCUMENT NAME
- -------                           -------------
        
 3.1.1     IMAX Corporation Articles of Amalgamation, dated January 1,
           2002. Incorporated by reference to Exhibit 3.1 to IMAX
           Corporation's Form 10-K for the year ended December 31,
           2001, file no. 000-24216.
 3.1.2     IMAX Corporation New By-Law No. 1, enacted on June 7, 1999.
           Incorporated by reference to Exhibit 3.2 to IMAX
           Corporation's Form 10-Q for the quarter ended September 30,
           1999, file no. 000-24216.
 3.2.1*    1329507 Ontario Inc. Articles of Incorporation, dated
           December 14, 1998.
 3.2.2*    1329507 Ontario Inc. By-Law No. 1, dated December 14, 1998.
 3.3.1*    924689 Ontario Inc. Articles of Incorporation, dated
           December 20, 1990.
 3.3.2*    924689 Ontario Inc. By-Law No. 1, dated December 20, 1998.
 3.4.1*    David Keighley Productions 70mm Inc. Certificate of
           Amendment of Certificate of Incorporation, dated May 4,
           2001.
 3.4.2*    David Keighley Productions 70mm Inc., By-Laws.
 3.5.1*    IMAX (Titanic) Inc. Certificate of Amendment of Certificate
           of Incorporation, dated March 16, 1993.
 3.5.2*    IMAX (Titanic) Inc. By-Laws.
 3.6.1*    IMAX (Titanica) Ltd. Articles of Amendment, dated March 12,
           1993.
 3.6.2*    IMAX (Titanica) Ltd. By-Law No. 1, dated December 1, 1987.
           IMAX (Titanica) Ltd. By-Law No. 2, dated December 1, 1987.
 3.7.1*    IMAX Chicago Theatre LLC Amended and Restated Certificate of
           Formation, dated October 16, 2002.
 3.7.2*    IMAX Chicago Theatre LLC Limited Liability Company
           Agreement, entered into as of October 16, 2002.
 3.8.1*    IMAX Film Holding Co. Certificate of Incorporation, dated
           April 5, 2000.
 3.8.2*    IMAX Film Holding Co. By-Laws.
 3.9.1*    IMAX Forum Ride, Inc. Certificate of Amendment of Articles
           of Incorporation, dated May 1, 1996.
 3.9.2*    IMAX Forum Ride, Inc. Code of Bylaws.
 3.10.1*   IMAX II U.S.A. Inc. Certificate of Incorporation, dated
           December 8, 1995.
 3.10.2*   IMAX II U.S.A. Inc. By-Laws.
 3.11.1*   IMAX Indianapolis LLC Articles of Organization, dated
           January 23, 2001.
 3.11.2*   IMAX Indianapolis LLC Operating Agreement, entered into as
           of February 1, 2001.
 3.12.1*   IMAX Minnesota Holding Co. Certificate of Incorporation,
           dated May 26, 2000.
 3.12.2*   IMAX Minnesota Holding Co. By-Laws.
 3.13.1*   IMAX Music Ltd. Certificate of Incorporation, dated December
           11, 2000.
 3.13.2*   IMAX Music Ltd. By-Law No. 1, dated December 11, 2000.
 3.14.1*   IMAX Pictures Corporation Certificate of Incorporation,
           dated February 15, 1995.
 3.14.2*   IMAX Pictures Corporation By-Laws.
 3.15.1*   IMAX Providence General Partner Co. Certificate of
           Incorporation, dated April 18, 1997.
 3.15.2*   IMAX Providence General Partner Co. By-Laws.
 3.16.1*   IMAX Providence Limited Partner Co. Certificate of
           Incorporation, dated April 18, 1997.
 3.16.2*   IMAX Providence Limited Partner Co. By-Laws.
 3.17.1*   IMAX Rhode Island Limited Partnership Certificate of Limited
           Partnership, dated April 18, 1997.
 3.18.1*   IMAX Sandde Animation Inc. Articles of Amendment, dated
           February 24, 1998.
 3.18.2*   IMAX Sandde Animation Inc. By-Law No. 1, dated January 19,
           1996.
 3.19.1*   IMAX Scribe Inc. Certificate of Incorporation, dated
           February 20, 1996.
 3.19.2*   IMAX Scribe Inc. By-Laws.



                                      II-10




EXHIBIT
 NUMBER                           DOCUMENT NAME
- -------                           -------------
        
 3.20.1*   IMAX Space Ltd. Articles of Incorporation, dated February
           22, 1995.
 3.20.2*   IMAX Space Ltd. By-Law No. 1, made as of February 22, 1995.
 3.21.1*   IMAX Theatre Holding (Brossard) Inc. Certificate of
           Incorporation, dated December 16, 1998.
 3.21.2*   IMAX Theatre Holding (Brossard) Inc. By-Law No. 1, made as
           of December 16, 1998.
 3.22.1*   IMAX Theatre Holding (California I) Co. Certificate of
           Incorporation, dated July 24, 1997.
 3.22.2*   IMAX Theatre Holding (California I) Co. By-Laws.
 3.23.1*   IMAX Theatre Holding (California II) Co. Certificate of
           Incorporation, dated July 24, 1997.
 3.23.2*   IMAX Theatre Holding (California II) Co. By-Laws.
 3.24.1*   IMAX Theater Holding (Nyack I) Co. Certificate of
           Incorporation, dated July 25, 1997.
 3.24.2*   IMAX Theater Holding (Nyack I) Co. By-Laws.
 3.25.1*   IMAX Theater Holding (Nyack II) Co. Certificate of
           Incorporation, dated July 25, 1997.
 3.25.2*   IMAX Theater Holding (Nyack II) Co. By-Laws.
 3.26.1*   IMAX Theatre Holding Co. Certificate of Incorporation, dated
           April 18, 1997.
 3.26.2*   IMAX Theatre Holding Co. By-Laws.
 3.27.1*   IMAX Theatre Holdings (OEI), Inc. Certificate of
           Incorporation, dated January 8, 1998.
 3.27.2*   IMAX Theatre Holdings (OEI), Inc. By-Laws.
 3.28.1*   IMAX Theatre Management (Scottsdale), Inc. Articles of
           Incorporation, dated April 2, 1991.
 3.28.2*   IMAX Theatre Management (Scottsdale), Inc. By-Laws, adopted
           as of April 3, 1991.
 3.29.1*   IMAX Theatre Management Company Certificate of
           Incorporation, dated April 18, 1997.
 3.29.2*   IMAX Theatre Management Company By-Laws.
 3.30.1*   IMAX Theatre Services Ltd. Articles of Incorporation, dated
           February 19, 1993.
 3.30.2*   IMAX Theatre Services Ltd. By-Law No. 1, enacted on February
           19, 1993.
           IMAX Theatre Services Ltd. By-Law No. 2, enacted on February
           19, 1993.
 3.31.1*   IMAX U.S.A. Inc. Certificate of Amendment of Certificate of
           Incorporation, dated June 29, 1995.
 3.31.2*   IMAX U.S.A. Inc. By-Laws.
 3.32.1*   Immersive Entertainment Inc. Certificate of Incorporation,
           dated April 25, 1995.
 3.32.2*   Immersive Entertainment Inc. By-Laws.
 3.33.1*   Miami Theatre LLC Certificate of Formation, dated November
           25, 1998.
 3.33.2*   Miami Theatre LLC Limited Liability Company Agreement,
           entered into as of November 25, 1998.
 3.34.1*   Mitey Cinema Inc. Articles of Amendment, dated February 21,
           1996.
 3.34.2*   Mitey Cinema Inc. By-Law No. 1, made as of December 22,
           1995.
 3.35.1*   Mountainview Theatre Management Ltd. Certificate of
           Incorporation, dated December 13, 1988.
 3.35.2*   Mountainview Theatre Management Ltd. By-Law No. 1, effective
           December 13, 1988.
           Mountainview Theatre Management Ltd. By-Law No. 2, enacted
           December 22, 1992.
 3.36.1*   Nyack Theatre LLC Articles of Organization, dated September
           10, 1998.
 3.36.2*   Nyack Theatre LLC Operating Agreement, dated September 16,
           1998.
 3.37.1*   Panda Production Inc. Certificate of Incorporation, dated
           November 2, 1999.
 3.37.2*   Panda Production Inc. By-Laws.
 3.38.1*   Ridefilm Corporation Certificate for Restoration, Renewal
           and Revival of Certificate of Incorporation, dated April 3,
           1996.
 3.38.2*   Ridefilm Corporation By-Laws.
 3.39.1*   RPM Pictures Ltd. Certificate of Incorporation, dated
           January 13, 2003.
 3.39.2*   RPM Pictures Ltd. By-Law No. 1, dated January 13, 2003.
 3.40.1*   Sacramento Theatre LLC Certificate of Formation, dated May
           12, 1999.
 3.40.2*   Sacramento Theatre LLC Limited Liability Company Agreement,
           made and entered into as of May 12, 1999.
 3.41.1*   Sonics Associates, Inc., A Body Corporate Certificate of
           Incorporation, dated January 28, 1972.


                                      II-11





EXHIBIT
 NUMBER                           DOCUMENT NAME
- -------                           -------------
        
 3.41.2*   Sonics Associates, Inc. By-Laws.
 3.42.1*   Starboard Theatres Ltd. Certificate of Incorporation, dated
           June 10, 1997.
 3.42.2*   Starboard Theatres Ltd. By-Law No. 1, enacted December 19,
           1986.
 3.43.1*   Strategic Sponsorship Corporation Certificate of Amendment
           of Certificate of Incorporation, dated November 4, 1999.
 3.43.2*   Strategic Sponsorship Corporation By-Laws.
 3.44.1*   Tantus Films Ltd. Certificate of Incorporation, dated March
           22, 2002.
 3.44.2*   Tantus Films Ltd. By-Law No. 1.
 3.45.1*   Tantus II Films Ltd. Certificate of Incorporation, dated
           April 7, 2003.
 3.45.2*   Tantus II Films Ltd. By-Law No. 1, dated as of April 7,
           2003.
 3.46.1*   Wire Frame Films Ltd. Certificate of Incorporation, dated
           February 16, 1998.
 3.46.2*   Wire Frame Films Ltd. By-Law No. 1, made as of February 17,
           1998.
3.47.1**   3D Sea II Ltd. Articles of Incorporation.
3.47.2**   3D Sea II Ltd. By-Law No. 1.
3.48.1**   Taurus-Littrow Productions Inc. Certificate of
           Incorporation.
3.48.2**   Taurus-Littrow Productions Inc. By-Laws.
 4.1*      Purchase Agreement, dated as of November 19, 2003, by and
           among IMAX Corporation, the Guarantors (as defined therein),
           Credit Suisse First Boston LLC, Jefferies & Company, Inc.,
           Wachovia Capital Markets, LLC and U.S. Bancorp Piper Jaffray
           Inc., relating to the issuance of IMAX Corporation's 9 5/8%
           Senior Notes due 2010.
 4.2*      Registration Rights Agreement, dated as of December 4, 2003,
           by and among IMAX Corporation, the Guarantors (as defined
           therein), Credit Suisse First Boston LLC, Jefferies &
           Company, Inc., Wachovia Capital Markets, LLC and U.S.
           Bancorp Piper Jaffray Inc., relating to the issuance of IMAX
           Corporation's 9 5/8% Senior Notes due 2010.
 4.3*      Indenture, dated as of December 4, 2003, by and among IMAX
           Corporation, the Guarantors (as defined therein) and U.S.
           Bank National Association, as Trustee, related to the issue
           of IMAX Corporation's 9 5/8% Senior Notes due 2010. (the
           "Indenture")
 4.4       Forms of note and exchange note (included in Exhibit 4.3).
 4.5       Form of guarantee (included in Exhibit 4.3).
 4.6**     Supplemental Indenture dated April 1, 2004 among the
           Company, the Existing Guarantors (as defined therein), 3D
           Sea II Ltd., Taurus-Littrow Productions Inc. and U.S. Bank
           National Association, as Trustee, supplementing the
           Indenture.
 5.1**     Opinion of Shearman & Sterling LLP as to the validity of the
           notes and the accompanying guarantees.
 5.2**     Opinion of Robert D. Lister, Executive Vice President,
           Business and Legal Affairs and General Counsel of IMAX
           Corporation.
 8.1*      Opinion of Shearman & Sterling LLP as to certain U.S.
           federal income tax considerations.
10.1       Stock Option Plan of IMAX Corporation, dated June 7, 1999.
           Incorporated by reference to Exhibit 10.1 to IMAX
           Corporation's Form 10-Q for the quarter ended September 30,
           1999, file no. 000-24216.
10.2       Employment Agreement, dated as of July 15, 1997 between
           David Keighley Productions 70mm Inc. and David B. Keighley.
           Incorporated by reference to Exhibit 10.2 to IMAX
           Corporation's Form 10-K for the year ended December 31,
           2002, file no. 000-24216.
10.3       Employment Agreement, dated July 1, 1998 between IMAX
           Corporation and Bradley J. Wechsler. Incorporated by
           reference to Exhibit 10.2 to IMAX Corporation's Form 10-Q
           for the quarter ended September 30, 1998, file no.
           000-24216.
10.4       Amended Employment Agreement, dated July 12, 2000 between
           IMAX Corporation and Bradley J. Wechsler. Incorporated by
           reference to Exhibit 10.10 to IMAX Corporation's Form 10-Q
           for the quarter ended September 30, 2000, file no.
           000-24216.



                                      II-12




EXHIBIT
 NUMBER                           DOCUMENT NAME
- -------                           -------------
        
10.5       Amended Employment Agreement, dated April 3, 2001 between
           IMAX Corporation and Bradley J. Wechsler. Incorporated by
           reference to Exhibit 10.15 to IMAX Corporation's Form 10-Q
           for the quarter ended March 31, 2001, file no. 000-24216.
10.6       Amended Employment Agreement, dated April 23, 2002 between
           IMAX Corporation and Bradley J. Wechsler. Incorporated by
           reference to Exhibit 10.14 to IMAX Corporation's Form 10-Q
           for the quarter ended June 30, 2002, file no. 000-24216.
10.7       Employment Agreement, dated July 1, 1998 between IMAX
           Corporation and Richard L. Gelfond. Incorporated by
           reference to Exhibit 10.1 to IMAX Corporation's Form 10-Q
           for the quarter ended September 30, 1998, file no.
           000-24216.
10.8       Amended Employment Agreement, dated July 12, 2000 between
           IMAX Corporation and Richard L. Gelfond. Incorporated by
           reference to Exhibit 10.9 to IMAX Corporation's Form 10-Q
           for the quarter ended September 30, 2000, file no.
           000-24216.
10.9       Amended Employment Agreement, dated April 3, 2001 between
           IMAX Corporation and Richard L. Gelfond. Incorporated by
           reference to Exhibit 10.16 to IMAX Corporation's Form 10-Q
           for the quarter ended March 31, 2001, file no. 000-24216.
10.10      Amended Employment Agreement, dated April 23, 2002 between
           IMAX Corporation and Richard L. Gelfond. Incorporated by
           reference to Exhibit 10.13 to IMAX Corporation's Form 10-Q
           for the quarter ended June 30, 2002, file no. 000-24216.
10.11      Employment Agreement, dated March 9, 2001 between IMAX
           Corporation and Greg Foster. Incorporated by reference to
           Exhibit 10.9 to IMAX Corporation's Form 10-K for the year
           ended December 31, 2001, file no. 000-24216.
10.12      Amending Agreement, dated August 8, 2002 between IMAX
           Corporation and Greg Foster. Incorporated by reference to
           Exhibit 10.12 to IMAX Corporation's Form 10-K for the year
           ended December 31, 2002, file no. 000-24216.
10.13      Employment Agreement, dated May 9, 2001 between IMAX
           Corporation and Francis T. Joyce. Incorporated by reference
           to Exhibit 10.13 to IMAX Corporation's Form 10-K for the
           year ended December 31, 2002, file no. 000-24216.
10.14      Amended Employment Agreement, dated May 14, 2003 between
           IMAX Corporation and Francis T. Joyce. Incorporated by
           reference to Exhibit 10.16 to IMAX Corporation's Form 10-Q
           for the quarter ended June 30, 2003, file no. 000-24216.
10.15      Employment Agreement, dated May 17, 1999 between IMAX
           Corporation and Robert D. Lister. Incorporated by reference
           to Exhibit 10.14 to IMAX Corporation's Form 10-K for the
           year ended December 31, 2002, file no. 000-24216.
10.16      Amended Employment Agreement, dated April 4, 2001 between
           IMAX Corporation and Robert D. Lister. Incorporated by
           reference to Exhibit 10.15 to IMAX Corporation's Form 10-K
           for the year ended December 31, 2002, file no. 000-24216.
10.17*     Second Amended Employment Agreement, dated January 1, 2004
           between IMAX Corporation and Robert D. Lister.
10.18      Shareholders' Agreement, dated as of January 3, 1994, among
           WGIM Acquisition Corporation, the Selling Shareholders as
           defined therein, Wasserstein Perella Partners, L.P.,
           Wasserstein Perella Offshore Partners, L.P., Bradley J.
           Wechsler, Richard L. Gelfond and Douglas Trumbull (the
           "Selling Shareholders' Agreement"). Incorporated by
           reference to Exhibit 4.2 to IMAX Corporation's Form 10-K for
           the year ended December 31, 2000, file no. 000-24216.
10.19      Amendment, dated as of March 1, 1994, to the Selling
           Shareholders' Agreement. Incorporated by reference to
           Exhibit 4.3 to IMAX Corporation's Form 10-K for the year
           ended December 31, 2000, file no. 000-24216.
10.20      Amended and Restated Shareholders' Agreement, dated as of
           February 9, 1999, by and among Wasserstein Perella Partners,
           L.P., Wasserstein Perella Offshore Partners, L.P., WPPN
           Inc., the Michael J. Biondi Voting Trust, Bradley J.
           Wechsler and Richard L. Gelfond and IMAX Corporation.
           Incorporated by reference to Exhibit 4.10 to IMAX
           Corporation's Form 10-K for the year ended December 31,
           1998, file no. 000-24216.


                                      II-13





EXHIBIT
 NUMBER                           DOCUMENT NAME
- -------                           -------------
        
10.21      Registration Rights Agreement, dated as of February 9, 1999,
           by and among IMAX Corporation, Wasserstein Perella Partners,
           L.P., Wasserstein Perella Offshore Partners, L.P., WPPN
           Inc., the Michael J. Biondi Voting Trust, Bradley J.
           Wechsler and Richard L. Gelfond. Incorporated by reference
           to Exhibit 4.12 to IMAX Corporation's Form 10-K for the year
           ended December 31, 1998, file no. 000-24216.
10.22*     Loan Agreement, dated as of February 6, 2004, by and between
           Congress Financial Corporation (Canada) and IMAX
           Corporation.
12.1**     Statement Regarding Computation of Ratios of Earnings to
           Fixed Charges.
21.1**     List of subsidiaries of IMAX Corporation detailing which
           subsidiaries are guarantors of IMAX Corporation's 9 5/8%
           Senior Notes due 2010.
23.1**     Consent of PricewaterhouseCoopers LLP.
23.2       Consents of Shearman & Sterling LLP (included in Exhibits
           5.1 and 8.1).
23.3*      Consent of McCarthy Tetrault LLP.
24.1*      Powers of Attorney.
25.1**     Statement of Eligibility of the Trustee.
99.1**     Form of Letter of Transmittal with respect to outstanding
           9 5/8% Senior Notes due 2010.
99.2*      Form of Notice of Guaranteed Delivery with respect to
           outstanding 9 5/8% Senior Notes due 2010.



- ---------------


 * Previously filed


** Filed herewith.


                                      II-14

EX-3.47.1

                                                                               .
                                                                               .
                                                                               .

                                                                                        
Request ID:            005980358  Province of Ontario                                            Date Report Produced: 2004/03/30
Demande ndegrees:                 Province de l'Ontario                                          Document produit le:
Transaction ID:        023306706  Ministry of Consumer and Business Services                     Time Report Produced: 12:33:15
Transaction ndegrees:             Ministere des Services aux consommateurs et aux entreprises    Imprime a:
Category ID:           CT         Companies and Personal Property Security Branch
Categorie:                        Direction des compagnies et des suretes mobilieres



                          CERTIFICATE OF INCORPORATION
                           CERTIFICAT DE CONSTITUTION

This is to certify that                                        Ceci certifie que

                            3 D  S E A  I I  L T D .

Ontario Corporation No.                Numero matricule de la personne morale en
                                       Ontario

                                0 0 2 0 4 3 8 0 0

is a corporation incorporated,             est une societe constituee aux termes
under the laws of the Province             des lois de la province de l'Ontario.
of Ontario.

These articles of incorporation            Les presents statuts constitutifs
are effective on                           entrent en vigueur le

                       M A R C H  30  M A R S ,  2 0 0 4

                                 Signed

                               Director/Directrice
           Business Corporations Act/Loi sur les societes par actions



                                                                         PAGE: 1

                                                  ONTARIO CORPORATION NUMBER
REQUEST ID / DEMANDE NDEGREES                 NUMERO DE LA COMPAGNIE EN ONTARIO

      5980358                                               2043800

        FORM 1                                                FORMULE NUMERO 1

BUSINESS CORPORATIONS ACT                  /              LOI SUR LES COMPAGNIES

                           ARTICLES OF INCORPORATION
                              STATUTS CONSTITUTIFS

1.       THE NAME OF THE CORPORATION IS: DENOMINATION SOCIALE DE LA COMPAGNIE:

                   3D SEA II LTD.

2.       THE ADDRESS OF THE REGISTERED OFFICE IS: ADRESSE DU SIEGE SOCIAL:

                2525           SPEAKMAN DRIVE

         (STREET & Number, or R.R. Number & If Multi-Office Building give Room
          No.)

         (RUE ET NUMERO, OU NUMERO DE LA R.R. ET, S'IL S'AGIT EDIFICE A BUREAU,
          NUMERO DU BUREAU)

              MISSISSAUGA                         ONTARIO
              CANADA                              L5K 1B1

                                                          
         (NAME OF MUNICIPALITY OR POST OFFICE)               (POSTAL CODE/CODE POSTAL)
         (NOM DE LA MUNICIPALITE OU DU BUREAU DE POSTE)

3.       NUMBER (OR MINIMUM AND MAXIMUM                      NOMBRE (OU NOMBRES MINIMAL ET MAXIMAL)
         NUMBER) OF DIRECTORS IS:                            D'ADMINISTRATEURS:
         MINIMUM 1                                           MAXIMUM 10

4.       THE FIRST DIRECTOR(S) IS/ARE:                       PREMIER(S) ADMINISTRATEUR(S):

         FIRST NAME, INITIALS AND SURNAME                    RESIDENT CANADIAN        STATE YES OR NO
         PRENOM, INITIALES ET NOM DE FAMILLE                 RESIDENT CANADIEN           OUI/NON

         ADDRESS FOR SERVICE, GIVING STREET & No.            DOMICILE ELU, Y COMPRIS LA RUE ET LE
         OR R.R. NO., MUNICIPALITY AND POSTAL CODE           NUMERO, LE NUMERO DE LA R.R., OU LE NOM
                                                             DE LA MUNICIPALITE ET LE CODE POSTAL



*        G. MARY                                                             YES
         RUBY

         2525 SPEAKMAN DRIVE

         MISSISSAUGA ONTARIO
         CANADA L5K 1B1



                                                                         PAGE: 2

                                                  ONTARIO CORPORATION NUMBER
REQUEST ID / DEMANDE NDEGREES                  NUMERO DE LA COMPAGNIE EN ONTARIO

      5980358                                               2043800

5.       RESTRICTIONS, IF ANY, ON BUSINESS THE CORPORATION MAY CARRY ON OR ON
         POWERS THE CORPORATION MAY EXERCISE.

         LIMITES, S'IL Y A LIEU, IMPOSEES AUX ACTIVITES COMMERCIALES OU AUX
         POUVOIRS DE LA COMPAGNIE.

         NONE

6.       THE CLASSES AND ANY MAXIMUM NUMBER OF SHARES THAT THE CORPORATION IS
         AUTHORIZED TO ISSUE:

         CATEGORIES ET NOMBRE MAXIMAL, S'IL Y A LIEU, D'ACTIONS QUE LA COMPAGNIE
         EST AUTORISEE A EMETTRE:

         THE CORPORATION IS AUTHORIZED TO ISSUE AN UNLIMITED NUMBER OF COMMON
         SHARES.



                                                                         PAGE: 3

                                                  ONTARIO CORPORATION NUMBER
REQUEST ID / DEMANDE NDEGREES                  NUMERO DE LA COMPAGNIE EN ONTARIO

      5980358                                               2043800

7.       RIGHTS, PRIVILEGES, RESTRICTIONS AND CONDITIONS (IF ANY) ATTACHING TO
         EACH CLASS OF SHARES AND DIRECTORS AUTHORITY WITH RESPECT TO ANY CLASS
         OF SHARES WHICH MAY BE ISSUED IN SERIES:

         DROITS, PRIVILEGES, RESTRICTIONS ET CONDITIONS, S'IL Y A LIEU,
         RATTACHES A CHAQUE CATEGORIE D'ACTIONS ET POUVOIRS DES ADMINISTRATEURS
         RELATIFS A CHAQUE CATEGORIE D'ACTIONS QUE PEUT ETRE EMISE EN SERIE:

                  (a)      PAYMENT OF DIVIDENDS: THE HOLDERS OF THE COMMON
         SHARES SHALL BE ENTITLED TO RECEIVE DIVIDENDS IF, AS AND WHEN DECLARED
         BY THE BOARD OF DIRECTORS OF THE CORPORATION OUT OF THE ASSETS OF THE
         CORPORATION PROPERLY APPLICABLE TO THE PAYMENT OF DIVIDENDS IN SUCH
         AMOUNTS AND PAYABLE IN SUCH MANNER AS THE BOARD OF DIRECTORS MAY FROM
         TIME TO TIME DETERMINE. SUBJECT TO THE RIGHTS OF THE HOLDERS OF ANY
         OTHER CLASS OF SHARES OF THE CORPORATION ENTITLED TO RECEIVE DIVIDENDS
         IN PRIORITY TO OR CONCURRENTLY WITH THE HOLDERS OF THE COMMON SHARES,
         THE BOARD OF DIRECTORS MAY IN ITS SOLE DISCRETION DECLARE DIVIDENDS ON
         THE COMMON SHARES TO THE EXCLUSION OF ANY OTHER CLASS OF SHARES OF THE
         CORPORATION.

                  (b)      PARTICIPATION UPON LIQUIDATION, DISSOLUTION OR
         WINDING UP: IN THE EVENT OF THE LIQUIDATION, DISSOLUTION OR WINDING UP
         OF THE CORPORATION OR OTHER DISTRIBUTION OF ASSETS OF THE CORPORATION
         AMONG ITS SHAREHOLDERS FOR THE PURPOSE OF WINDING UP ITS AFFAIRS, THE
         HOLDERS OF THE COMMON SHARES SHALL, SUBJECT TO THE RIGHTS OF THE
         HOLDERS OF ANY OTHER CLASS OF SHARES OF THE CORPORATION ENTITLED TO
         RECEIVE ASSETS OF THE CORPORATION UPON SUCH A DISTRIBUTION IN PRIORITY
         TO OR CONCURRENTLY WITH THE HOLDERS OF THE COMMON SHARES, BE ENTITLED
         TO PARTICIPATE IN THE DISTRIBUTION. SUCH DISTRIBUTION SHALL BE MADE IN
         EQUAL AMOUNTS PER SHARE ON ALL THE COMMON SHARES AT THE TIME
         OUTSTANDING WITHOUT PREFERENCE OR DISTINCTION.

                  (c)      VOTING RIGHTS: THE HOLDERS OF THE COMMON SHARES SHALL
         BE ENTITLED TO RECEIVE NOTICE OF AND TO ATTEND ALL ANNUAL AND SPECIAL
         MEETINGS OF THE SHAREHOLDERS OF THE CORPORATION AND TO ONE VOTE IN
         RESPECT OF EACH COMMON SHARE HELD AT ALL SUCH MEETINGS.



                                                                         PAGE: 4

                                                  ONTARIO CORPORATION NUMBER
REQUEST ID / DEMANDE NDEGREES                  NUMERO DE LA COMPAGNIE EN ONTARIO

      5980358                                               2043800

8.       THE ISSUE, TRANSFER OR OWNERSHIP OF SHARES IS/IS NOT RESTRICTED AND THE
         RESTRICTIONS (IF ANY) ARE AS FOLLOWS:

         L'EMISSION, LE TRANSFERT OU LA PROPRIETE D'ACTIONS EST/N'EST PAS
         RESTREINTE. LES RESTRICTIONS, S'IL Y A LIEU, SONT LES SUIVANTES:

         NO SHARE IN THE CAPITAL OF THE CORPORATION SHALL BE TRANSFERRED WITHOUT
         THE CONSENT OF THE DIRECTORS EXPRESSED BY THE VOTES OF A MAJORITY OF
         THE DIRECTORS AT A MEETING OF THE DIRECTORS OR BY AN INSTRUMENT OR
         INSTRUMENTS IN WRITING SIGNED BY A MAJORITY OF THE DIRECTORS.



                                                                         PAGE: 5

                                                  ONTARIO CORPORATION NUMBER
REQUEST ID / DEMANDE NDEGREES                  NUMERO DE LA COMPAGNIE EN ONTARIO

      5980358                                               2043800

9.       OTHER PROVISIONS, (IF ANY, ARE):

         AUTRES DISPOSITIONS, S'IL Y A LIEU:

         (1)      THE NUMBER OF SHAREHOLDERS OF THE CORPORATION, EXCLUSIVE OF
         PERSONS WHO ARE IN ITS EMPLOYMENT AND EXCLUSIVE OF PERSONS WHO, HAVING
         BEEN FORMERLY IN THE EMPLOYMENT OF THE CORPORATION, WERE, WHILE IN THAT
         EMPLOYMENT AND HAVE CONTINUED AFTER THE TERMINATION OF THAT EMPLOYMENT
         TO BE, SHAREHOLDERS OF THE CORPORATION, IS LIMITED TO NOT MORE THAN 50,
         2 OR MORE PERSONS WHO ARE THE JOINT REGISTERED OWNERS OF 1 OR MORE
         SHARES BEING COUNTED AS 1 SHAREHOLDER.

         (2)      ANY INVITATION TO THE PUBLIC TO SUBSCRIBE FOR SECURITIES OF
         THE CORPORATION IS PROHIBITED.



                                                                         PAGE: 6

                                                  ONTARIO CORPORATION NUMBER
REQUEST ID / DEMANDE NDEGREES                  NUMERO DE LA COMPAGNIE EN ONTARIO

      5980358                                               2043800

10.      THE NAMES AND ADDRESSES OF THE INCORPORATORS ARE

         NOM ET ADRESSE DES FONDATEURS

         FIRST NAME, INITIALS AND LAST NAME      PRENOM, INITIALE ET NOM DE
         OR CORPORATE NAME                       FAMILLE OU DENOMINATION SOCIALE

         FULL ADDRESS FOR SERVICE OR ADDRESS OF REGISTERED OFFICE OR OF
         PRINCIPAL PLACE OF BUSINESS GIVING STREET & NO. OR R.R. NO.,
         MUNICIPALITY AND POSTAL CODE

         DOMICILE ELU, ADRESSE DU SIEGE SOCIAL AU ADRESSE DE L'ETABLISSEMENT
         PRINCIPAL, Y COMPRIS LA RUE ET LE NUMERO, LE NUMERO DE LA R.R., LE NOM
         DE LA MUNICIPALITE ET LE CODE POSTAL

*        LAURA S. UYENAKA

         66 WELLINGTON STREET WEST SUITE 4700

         TORONTO ONTARIO
         CANADA M5K 1E6

EX-3.47.2

                                  BY-LAW NO. 1

                         A by-law relating generally to
                         the transaction of the business
                                 and affairs of

                                 3D SEA II LTD.

                                    DIRECTORS

1.       Calling of and notice of meetings Meetings of the board will be held on
such day and at such time and place as the President or Secretary of the
Corporation may determine. Notice of meetings of the board will be given to each
director not less than 48 hours before the time when the meeting is to be held.
Each newly elected board may without notice hold its first meeting for the
purposes of organization and the appointment of officers immediately following
the meeting of shareholders at which such board was elected.

2.       Place of meetings Meetings of the board may be held at any place within
or outside Ontario and in any financial year of the Corporation it will not be
necessary for a majority of the meetings of the board to be held at a place
within Canada.

3.       Votes to govern At all meetings of the board every question will be
decided by a majority of the votes cast on the question; and in case of an
equality of votes the chair of the meeting will not be entitled to a second or
casting vote.

4.       Interest of directors and officers generally in contracts No director
or officer will be disqualified by his or her office from contracting with the
Corporation nor will any contract or arrangement entered into by or on behalf of
the Corporation with any director or officer or in which any director or officer
is in any way interested be liable to be voided nor will any director or officer
so contracting or being so interested be liable to account to the Corporation
for any profit realized by any such contract or arrangement by reason of such
director or officer holding that office or of the fiduciary relationship thereby
established provided that, in each case, the director or officer has complied
with the provisions of the Business Corporations Act.

                             SHAREHOLDERS' MEETINGS

5.       Quorum At any meeting of shareholders a quorum will be 1 person present
in person or by telephonic or electronic means and each entitled to vote at the
meeting and holding or representing by proxy not less than 51% of the votes
entitled to be cast at the meeting.

6.       Casting vote In the case of an equality of votes at any meeting of
shareholders the chair of the meeting will not be entitled to a second or
casting vote.

7.       Meetings by telephonic or electronic means A meeting of the
shareholders may be held by telephonic or electronic means.



                                      -2-

8.       Postponement or cancellation of meetings A meeting of shareholders may
be postponed or cancelled by the board at any time prior to the date of the
meeting.

9.       Procedures at meetings The board may determine the procedures to be
followed at any meeting of shareholders including, without limitation, the rules
of order. Subject to the foregoing, the chair of a meeting may determine the
procedures of the meeting in all respects.

                                 INDEMNIFICATION

10.      Indemnification of directors and officers The Corporation will
indemnify a director or officer of the Corporation, a former director or officer
of the Corporation or a person who acts or acted at the Corporation's request as
a director or officer of a body corporate of which the Corporation is or was a
shareholder or creditor, and his or her heirs and legal representatives to the
extent permitted by the Business Corporations Act.

11.      Indemnity of others Except as otherwise required by the Business
Corporations Act and subject to paragraph 10, the Corporation may from time to
time indemnify and save harmless any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that he or she is or was an employee or agent of the Corporation, or is or
was serving at the request of the Corporation as a director, officer, employee,
agent of or participant in another body corporate, partnership, trust, joint
venture or unincorporated association or organization, against expenses
(including legal fees), judgments, fines and any amount actually and reasonably
incurred by him or her in connection with such action, suit or proceeding if he
or she acted honestly and in good faith with a view to the best interests of the
Corporation or, as the case may be, to the best interests of the other entity
for which he or she served at the Corporation's request and, with respect to any
criminal or administrative action or proceeding that is enforced by a monetary
penalty, had reasonable grounds for believing that his or her conduct was
lawful. The termination of any action, suit or proceeding by judgment, order,
settlement or conviction will not, of itself, create a presumption that the
person did not act honestly and in good faith with a view to the best interests
of the Corporation or other entity and, with respect to any criminal or
administrative action or proceeding that is enforced by a monetary penalty, had
no reasonable grounds for believing that his or her conduct was lawful.

12.      Right of indemnity not exclusive The provisions for indemnification
contained in the by-laws of the Corporation will not be deemed exclusive of any
other rights to which any person seeking indemnification may be entitled under
any agreement, vote of shareholders or directors or otherwise, both as to action
in his or her official capacity and as to action in another capacity, and will
continue as to a person who has ceased to be a director, officer, employee or
agent and will inure to the benefit of that person's heirs and legal
representatives.

13.      No liability of directors or officers for certain matters To the extent
permitted by law, no director or officer for the time being of the Corporation
will be liable for the acts, receipts,



                                      -3-

neglects or defaults of any other director or officer or employee or for joining
in any receipt or act for conformity or for any loss, damage or expense
happening to the Corporation through the insufficiency or deficiency of title to
any property acquired by the Corporation or for or on behalf of the Corporation
or for the insufficiency or deficiency of any security in or upon which any of
the moneys of or belonging to the Corporation will be placed out or invested or
for any loss or damage arising from the bankruptcy, insolvency or tortious act
of any person, firm or body corporate with whom or which any moneys, securities
or other assets belonging to the Corporation will be lodged or deposited or for
any loss, conversion, misapplication or misappropriation of or any damage
resulting from any dealings with any moneys, securities or other assets
belonging to the Corporation or for any other loss, damage or misfortune
whatever which may happen in the execution of the duties of his or her
respective office or trust or in relation thereto unless the same will happen by
or through his or her failure to act honestly and in good faith with a view to
the best interests of the Corporation and in connection therewith to exercise
the care, diligence and skill that a reasonably prudent person would exercise in
comparable circumstances. If any director or officer of the Corporation is
employed by or performs services for the Corporation otherwise than as a
director or officer or is a member of a firm or a shareholder, director or
officer of a body corporate which is employed by or performs services for the
Corporation, the fact that the person is a director or officer of the
Corporation will not disentitle such director or officer or such firm or body
corporate, as the case may be, from receiving proper remuneration for such
services.

                      BANKING ARRANGEMENTS, CONTRACTS, ETC.

14.      Banking arrangements The banking business of the Corporation, or any
part thereof, will be transacted with such banks, trust companies or other
financial institutions as the board may designate, appoint or authorize from
time to time and all such banking business, or any part thereof, will be
transacted on the Corporation's behalf by one or more officers or other persons
as the board may designate, direct or authorize from time to time.

15.      Execution of instruments Contracts, documents or instruments in writing
requiring execution by the Corporation will be signed by hand by any two
persons, each of whom is an officer or director of the Corporation (whether
under the corporate seal of the Corporation, if any, or otherwise) and all
contracts, documents or instruments in writing so signed will be binding upon
the Corporation without any further authorization or formality. The board is
authorized from time to time by resolution

         (a)      to appoint any officer or any other person on behalf of the
                  Corporation to sign by hand (whether under the corporate seal
                  of the Corporation, if any, or otherwise) and deliver either
                  contracts, documents or instruments in writing generally or to
                  sign either by hand or by facsimile or mechanical signature or
                  otherwise (whether under the corporate seal of the
                  Corporation, if any, or otherwise) and deliver specific
                  contracts, documents or instruments in writing, and



                                      -4-

         (b)      to delegate to any two officers of the Corporation the powers
                  to designate, direct or authorize from time to time in writing
                  one or more officers or other persons on the Corporation's
                  behalf to sign either by hand or by facsimile or mechanical
                  signature or otherwise (whether under the corporate seal of
                  the Corporation, if any, or otherwise) and deliver contracts,
                  documents or instruments in writing of such type and on such
                  terms and conditions as such two officers see fit.

Contracts, documents or instruments in writing that are to be signed by hand may
be signed electronically. The term "contracts, documents or instruments in
writing" as used in this by-law includes without limitation deeds, mortgages,
charges, conveyances, powers of attorney, transfers and assignments of property
of all kinds (including specifically but without limitation transfers and
assignments of shares, warrants, bonds, debentures or other securities), proxies
for shares or other securities and all paper writings.

                                  MISCELLANEOUS

16.      Invalidity of any provisions of this by-law The invalidity or
unenforceability of any provision of this by-law will not affect the validity or
enforceability of the remaining provisions of this by-law.

17.      Omissions and errors The accidental omission to give any notice to any
shareholder, director, officer or auditor or the non-receipt of any notice by
any shareholder, director, officer or auditor or any error in any notice not
affecting its substance will not invalidate any action taken at any meeting to
which the notice related or otherwise founded on the notice.

                                 INTERPRETATION

18.      Interpretation In this by-law and all other by-laws of the Corporation
words importing the singular number only include the plural and vice versa;
words importing any gender include all genders; words importing persons include
individuals, corporations, limited and unlimited liability companies, general
and limited partnerships, associations, trusts, unincorporated organizations,
joint ventures and governmental authorities; "board" means the board of
directors of the Corporation; "Business Corporations Act" means the Business
Corporations Act, R.S.O. 1990, c. B.16 as from time to time amended, re-enacted
or replaced; terms that are not otherwise defined in this by-law have the
meanings attributed to them in the Business Corporations Act; and "meeting of
shareholders" means an annual meeting of shareholders or a special meeting of
shareholders.



                                      -5-

         RESOLVED that the foregoing By-law No. 1 is made a by-law of the
Corporation.

         The undersigned, being the sole director of 3D SEA II LTD., signs the
foregoing resolution.

         DATED as of March 30, 2004.

                                                   /s/ G. Mary Ruby
                                                   ----------------------------
                                                   G. Mary Ruby

         RESOLVED that the foregoing By-law No. 1 of the by-laws of the
Corporation is confirmed.

         The undersigned, being the sole shareholder of 3D SEA II LTD., signs
the foregoing resolution.

         DATED as of March 30, 2004.

                                                   IMAX CORPORATION

                                                   Per:
                                                         Kathryn Gamble
                                                         -----------------------
                                                         Vice-President, Finance
                                                         and Controller

EX-3.48.1

                          CERTIFICATE OF INCORPORATION
                                       OF
                         TAURUS-LITTROW PRODUCTIONS INC.

                  I, the undersigned, for the purposes of incorporating and
organizing a corporation under the General Corporation Law of the State of
Delaware, do execute this Certificate of Incorporation and do hereby certify as
follows:

                  FIRST. The name of the corporation is Taurus-Littrow
Productions Inc.

                  SECOND. The address of the corporation's registered office in
the State of Delaware is One Rodney Square, 10th Floor, Tenth and King Streets,
in the City of Wilmington, County of New Castle, 19801. The name of its
registered agent at such address is RL&F Service Corp.

                  THIRD. The purpose of the corporation is to engage in any
lawful act or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.

                  FOURTH. The total number of shares of stock which the
corporation shall have authority to issue is 100. All such shares are to be
Common Stock, par value of $.01 per share, and are to be of one class.

                  FIFTH. The incorporator of the corporation is Siobhan Cameron,
whose mailing address is P.O. Box 551, Wilmington DE 19899.

                  SIXTH. Unless and except to the extent that the by-laws of the
corporation shall so require, the election of directors of the corporation need
not be by written ballot.

                  SEVENTH. In furtherance and not in limitation of the powers
conferred by the laws of the State of Delaware, the Board of Directors of the
corporation is expressly authorized to make, alter and repeal the by-laws of the
corporation.

                  EIGHTH. A director of the corporation shall not be liable to
the corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except to the extent such exemption from liability or
limitation thereof is not permitted under the General Corporation Law of the
State of Delaware as the same exists or may hereafter be amended. Any amendment,
modification or repeal of the foregoing sentence shall not adversely affect any
right or protection of a director of the corporation hereunder in respect of any
act or omission occurring prior to the time of such amendment, modification or
repeal.

                  NINTH. The corporation reserves the right at any time, and
from time to time, to amend, alter, change or repeal any provision contained in
this Certificate of Incorporation, and other provisions authorized by the laws
of the State of Delaware at the time in force may be added or inserted, in the
manner now or hereafter prescribed by law; and all rights, preferences and
privileges of any nature conferred upon stockholders, directors or any other
persons by and pursuant to this Certificate of Incorporation in its present form
or as hereafter amended are granted subject to the rights reserved in this
article.

                                       1



                  TENTH. The powers of the incorporator are to terminate upon
the filing of this Certificate of Incorporation with the Secretary of State of
the State of Delaware. The name and mailing address of the person who is to
serve as the sole initial director of the corporation until the first annual
meeting of stockholders of the corporation, or until her successor is duly
elected and qualified, is:

                  G. Mary Ruby
                  2525 Speakman Dr., Sheridan Park
                  Mississauga, Ontario L5K 1B1

                  The undersigned incorporator hereby acknowledges that the
foregoing certificate of incorporation is her act and deed on this the 3rd day
of March, 2004.

                                                     /s/ Siobhan Cameron
                                                     --------------------------
                                                     Siobhan Cameron
                                                     Incorporator

                                       1

EX-3.48.2

                                                                       Exhibit A

                                     BY-LAWS

                                       OF

                         TAURUS-LITTROW PRODUCTIONS INC.

                                    ARTICLE I

                            Meetings of Stockholders

                  Section 1.1. Annual Meetings. If required by applicable law,
an annual meeting of stockholders shall be held for the election of directors at
such date, time and place, if any, either within or without the State of
Delaware, as may be designated by resolution of the Board of Directors from time
to time. Any other proper business may be transacted at the annual meeting.

                  Section 1.2. Special Meetings. Special meetings of
stockholders for any purpose or purposes may be called at any time by the Board
of Directors, but such special meetings may not be called by any other person or
persons. Business transacted at any special meeting of stockholders shall be
limited to the purposes stated in the notice.

                  Section 1.3. Notice of Meetings. Whenever stockholders are
required or permitted to take any action at a meeting, a notice of the meeting
shall be given that shall state the place, if any, date and hour of the meeting
and, in the case of a special meeting, the purpose or purposes for which the
meeting is called. Unless otherwise provided by law, the certificate of
incorporation or these by-laws, the notice of any meeting shall be given not
less than ten (10) nor more than sixty (60) days before the date of the meeting
to each stockholder entitled to vote at such meeting. If mailed, such notice
shall be deemed to be given when deposited in the United States mail, postage
prepaid, directed to the stockholder at such stockholder's address as it appears
on the records of the corporation.

                  Section 1.4. Adjournments. Any meeting of stockholders, annual
or special, may adjourn from time to time to reconvene at the same or some other
place, and notice need not be given of any such adjourned meeting if the time
and place thereof are announced at the meeting at which the adjournment is
taken. At the adjourned meeting the corporation may transact any business which
might have been transacted at the original meeting. If the adjournment is for
more than thirty (30) days, or if after the adjournment a new record date is
fixed for the adjourned meeting, notice of the adjourned meeting shall be given
to each stockholder of record entitled to vote at the meeting.

                  Section 1.5. Quorum. Except as otherwise provided by law, the
certificate of incorporation or these by-laws, at each meeting of stockholders
the presence in person or by proxy of the holders of a majority in voting power
of the outstanding shares of stock



entitled to vote at the meeting shall be necessary and sufficient to constitute
a quorum. In the absence of a quorum, the stockholders so present may, by a
majority in voting power thereof, adjourn the meeting from time to time in the
manner provided in Section 1.4 of these by-laws until a quorum shall attend.
Shares of its own stock belonging to the corporation or to another corporation,
if a majority of the shares entitled to vote in the election of directors of
such other corporation is held, directly or indirectly, by the corporation,
shall neither be entitled to vote nor be counted for quorum purposes; provided,
however, that the foregoing shall not limit the right of the corporation or any
subsidiary of the corporation to vote stock, including but not limited to its
own stock, held by it in a fiduciary capacity.

                  Section 1.6. Organization. Meetings of stockholders shall be
presided over by the Chairperson of the Board, if any, or in his or her absence
by the Vice Chairperson of the Board, if any, or in his or her absence by the
President, or in his or her absence by a Vice President, or in the absence of
the foregoing persons by a chairperson designated by the Board of Directors, or
in the absence of such designation by a chairperson chosen at the meeting. The
Secretary shall act as secretary of the meeting, but in his or her absence the
chairperson of the meeting may appoint any person to act as secretary of the
meeting.

                  Section 1.7. Voting; Proxies. Except as otherwise provided by
or pursuant to the provisions of the certificate of incorporation, each
stockholder entitled to vote at any meeting of stockholders shall be entitled to
one vote for each share of stock held by such stockholder which has voting power
upon the matter in question. Each stockholder entitled to vote at a meeting of
stockholders or to express consent to corporate action in writing without a
meeting may authorize another person or persons to act for such stockholder by
proxy, but no such proxy shall be voted or acted upon after three years from its
date, unless the proxy provides for a longer period. A proxy shall be
irrevocable if it states that it is irrevocable and if, and only as long as, it
is coupled with an interest sufficient in law to support an irrevocable power. A
stockholder may revoke any proxy which is not irrevocable by attending the
meeting and voting in person or by delivering to the Secretary of the
corporation a revocation of the proxy or a new proxy bearing a later date.
Voting at meetings of stockholders need not be by written ballot. At all
meetings of stockholders for the election of directors at which a quorum is
present a plurality of the votes cast shall be sufficient to elect. All other
elections and questions presented to the stockholders at a meeting at which a
quorum is present shall, unless otherwise provided by the certificate of
incorporation, these by-laws, the rules or regulations of any stock exchange
applicable to the corporation, or applicable law or pursuant to any regulation
applicable to the corporation or its securities, be decided by the affirmative
vote of the holders of a majority in voting power of the shares of stock of the
corporation which are present in person or by proxy and entitled to vote
thereon.

                  Section 1.8. Fixing Date for Determination of Stockholders of
Record. In order that the corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders or any adjournment thereof,
or to express consent to corporate

                                      -2-


action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix a
record date, which record date shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors, and
which record date: (1) in the case of determination of stockholders entitled to
vote at any meeting of stockholders or adjournment thereof, shall, unless
otherwise required by law, not be more than sixty (60) nor less than ten (10)
days before the date of such meeting; (2) in the case of determination of
stockholders entitled to express consent to corporate action in writing without
a meeting, shall not be more than ten (10) days from the date upon which the
resolution fixing the record date is adopted by the Board of Directors; and (3)
in the case of any other action, shall not be more than sixty (60) days prior to
such other action. If no record date is fixed: (1) the record date for
determining stockholders entitled to notice of or to vote at a meeting of
stockholders shall be at the close of business on the day next preceding the day
on which notice is given, or, if notice is waived, at the close of business on
the day next preceding the day on which the meeting is held; (2) the record date
for determining stockholders entitled to express consent to corporate action in
writing without a meeting, when no prior action of the Board of Directors is
required by law, shall be the first date on which a signed written consent
setting forth the action taken or proposed to be taken is delivered to the
corporation in accordance with applicable law, or, if prior action by the Board
of Directors is required by law, shall be at the close of business on the day on
which the Board of Directors adopts the resolution taking such prior action; and
(3) the record date for determining stockholders for any other purpose shall be
at the close of business on the day on which the Board of Directors adopts the
resolution relating thereto. A determination of stockholders of record entitled
to notice of or to vote at a meeting of stockholders shall apply to any
adjournment of the meeting; provided, however, that the Board of Directors may
fix a new record date for the adjourned meeting.

                  Section 1.9. List of Stockholders Entitled to Vote. The
officer who has charge of the stock ledger shall prepare and make, at least ten
(10) days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in alphabetical order,
and showing the address of each stockholder and the number of shares registered
in the name of each stockholder. Such list shall be open to the examination of
any stockholder, for any purpose germane to the meeting at least ten (10) days
prior to the meeting (i) on a reasonably accessible electronic network, provided
that the information required to gain access to such list is provided with the
notice of meeting or (ii) during ordinary business hours at the principal place
of business of the corporation. The list of stockholders must also be open to
examination at the meeting as required by applicable law. Except as otherwise
provided by law, the stock ledger shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list of stockholders or
the books of the corporation, or to vote in person or by proxy at any meeting of
stockholders.

                                      -3-


                  Section 1.10. Action By Written Consent of Stockholders.
Unless otherwise restricted by the certificate of incorporation, any action
required or permitted to be taken at any annual or special meeting of the
stockholders may be taken without a meeting, without prior notice and without a
vote, if a consent or consents in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and voted
and shall be delivered to the corporation by delivery to its registered office
in the State of Delaware, its principal place of business, or an officer or
agent of the corporation having custody of the book in which minutes of
proceedings of stockholders are recorded. Delivery made to the corporation's
registered office shall be by hand or by certified or registered mail, return
receipt requested. Prompt notice of the taking of the corporate action without a
meeting by less than unanimous written consent shall, to the extent required by
law, be given to those stockholders who have not consented in writing and who,
if the action had been taken at a meeting, would have been entitled to notice of
the meeting if the record date for such meeting had been the date that written
consents signed by a sufficient number of holders to take the action were
delivered to the corporation.

                  Section 1.11. Inspectors of Election. The corporation may, and
shall if required by law, in advance of any meeting of stockholders, appoint one
or more inspectors of election, who may be employees of the corporation, to act
at the meeting or any adjournment thereof and to make a written report thereof.
The corporation may designate one or more persons as alternate inspectors to
replace any inspector who fails to act. In the event that no inspector so
appointed or designated is able to act at a meeting of stockholders, the person
presiding at the meeting shall appoint one or more inspectors to act at the
meeting. Each inspector, before entering upon the discharge of his or her
duties, shall take and sign an oath to execute faithfully the duties of
inspector with strict impartiality and according to the best of his or her
ability. The inspector or inspectors so appointed or designated shall (i)
ascertain the number of shares of capital stock of the corporation outstanding
and the voting power of each such share, (ii) determine the shares of capital
stock of the corporation represented at the meeting and the validity of proxies
and ballots, (iii) count all votes and ballots, (iv) determine and retain for a
reasonable period a record of the disposition of any challenges made to any
determination by the inspectors, and (v) certify their determination of the
number of shares of capital stock of the corporation represented at the meeting
and such inspectors' count of all votes and ballots. Such certification and
report shall specify such other information as may be required by law. In
determining the validity and counting of proxies and ballots cast at any meeting
of stockholders of the corporation, the inspectors may consider such information
as is permitted by applicable law. No person who is a candidate for an office at
an election may serve as an inspector at such election.

                  Section 1.12. Conduct of Meetings. The date and time of the
opening and the closing of the polls for each matter upon which the stockholders
will vote at a meeting shall be announced at the meeting by the person presiding
over the meeting. The Board of

                                      -4-


Directors may adopt by resolution such rules and regulations for the conduct of
the meeting of stockholders as it shall deem appropriate. Except to the extent
inconsistent with such rules and regulations as adopted by the Board of
Directors, the person presiding over any meeting of stockholders shall have the
right and authority to convene and to adjourn the meeting, to prescribe such
rules, regulations and procedures and to do all such acts as, in the judgment of
such presiding person, are appropriate for the proper conduct of the meeting.
Such rules, regulations or procedures, whether adopted by the Board of Directors
or prescribed by the presiding person of the meeting, may include, without
limitation, the following: (i) the establishment of an agenda or order of
business for the meeting; (ii) rules and procedures for maintaining order at the
meeting and the safety of those present; (iii) limitations on attendance at or
participation in the meeting to stockholders of record of the corporation, their
duly authorized and constituted proxies or such other persons as the presiding
person of the meeting shall determine; (iv) restrictions on entry to the meeting
after the time fixed for the commencement thereof; and (v) limitations on the
time allotted to questions or comments by participants. The presiding person at
any meeting of stockholders, in addition to making any other determinations that
may be appropriate to the conduct of the meeting, shall, if the facts warrant,
determine and declare to the meeting that a matter or business was not properly
brought before the meeting and if such presiding person should so determine,
such presiding person shall so declare to the meeting and any such matter or
business not properly brought before the meeting shall not be transacted or
considered. Unless and to the extent determined by the Board of Directors or the
person presiding over the meeting, meetings of stockholders shall not be
required to be held in accordance with the rules of parliamentary procedure.

                                      -5-


                                   ARTICLE II

                               Board of Directors

                  Section 2.1. Number; Qualifications. The Board of Directors
shall consist of one or more members, the number thereof to be determined from
time to time by resolution of the Board of Directors. Directors need not be
stockholders.

                  Section 2.2. Election; Resignation; Vacancies. The Board of
Directors shall initially consist of the persons named as directors in the
certificate of incorporation or elected by the incorporator of the corporation,
and each director so elected shall hold office until the first annual meeting of
stockholders or until his or her successor is duly elected and qualified. At the
first annual meeting of stockholders and at each annual meeting thereafter, the
stockholders shall elect directors each of whom shall hold office for a term of
one year or until his or her successor is duly elected and qualified, subject to
such director's earlier death, resignation, disqualification or removal. Any
director may resign at any time upon notice to the corporation. Unless otherwise
provided by law or the certificate of incorporation, any newly created
directorship or any vacancy occurring in the Board of Directors for any cause
may be filled by a majority of the remaining members of the Board of Directors,
although such majority is less than a quorum, or by a plurality of the votes
cast at a meeting of stockholders, and each director so elected shall hold
office until the expiration of the term of office of the director whom he or she
has replaced or until his or her successor is elected and qualified.

                  Section 2.3. Regular Meetings. Regular meetings of the Board
of Directors may be held at such places within or without the State of Delaware
and at such times as the Board of Directors may from time to time determine.

                  Section 2.4. Special Meetings. Special meetings of the Board
of Directors may be held at any time or place within or without the State of
Delaware whenever called by the President, any Vice President, the Secretary, or
by any member of the Board of Directors. Notice of a special meeting of the
Board of Directors shall be given by the person or persons calling the meeting
at least twenty-four hours before the special meeting.

                  Section 2.5. Telephonic Meetings Permitted. Members of the
Board of Directors, or any committee designated by the Board of Directors, may
participate in a meeting thereof by means of conference telephone or other
communications equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting pursuant to this
by-law shall constitute presence in person at such meeting.

                  Section 2.6. Quorum; Vote Required for Action. At all meetings
of the Board of Directors the directors entitled to cast a majority of the votes
of the whole Board of Directors shall constitute a quorum for the transaction of
business. Except in cases in

                                      -6-


which the certificate of incorporation, these by-laws or applicable law
otherwise provides, a majority of the votes entitled to be cast by the directors
present at a meeting at which a quorum is present shall be the act of the Board
of Directors.

                  Section 2.7. Organization. Meetings of the Board of Directors
shall be presided over by the Chairperson of the Board, if any, or in his or her
absence by the Vice Chairperson of the Board, if any, or in his or her absence
by the President, or in their absence by a chairperson chosen at the meeting.
The Secretary shall act as secretary of the meeting, but in his or her absence
the chairperson of the meeting may appoint any person to act as secretary of the
meeting.

                  Section 2.8. Action by Unanimous Consent of Directors. Unless
otherwise restricted by the certificate of incorporation or these by-laws, any
action required or permitted to be taken at any meeting of the Board of
Directors, or of any committee thereof, may be taken without a meeting if all
members of the Board of Directors or such committee, as the case may be, consent
thereto in writing or by electronic transmission and the writing or writings or
electronic transmissions are filed with the minutes of proceedings of the board
or committee in accordance with applicable law.

                                      -7-


                                   ARTICLE III

                                   Committees

                  Section 3.1. Committees. The Board of Directors may designate
one or more committees, each committee to consist of one or more of the
directors of the corporation. The Board of Directors may designate one or more
directors as alternate members of any committee, who may replace any absent or
disqualified member at any meeting of the committee. In the absence or
disqualification of a member of the committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he, she
or they constitute a quorum, may unanimously appoint another member of the Board
of Directors to act at the meeting in place of any such absent or disqualified
member. Any such committee, to the extent permitted by law and to the extent
provided in the resolution of the Board of Directors, shall have and may
exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the corporation, and may authorize the
seal of the corporation to be affixed to all papers which may require it.

                  Section 3.2. Committee Rules. Unless the Board of Directors
otherwise provides, each committee designated by the Board of Directors may
make, alter and repeal rules for the conduct of its business. In the absence of
such rules each committee shall conduct its business in the same manner as the
Board of Directors conducts its business pursuant to Article II of these
by-laws.

                                      -8-


                                   ARTICLE IV

                                    Officers

                  Section 4.1. Executive Officers; Election; Qualifications;
Term of Office; Resignation; Removal; Vacancies. The Board of Directors shall
elect a President and Secretary, and it may, if it so determines, choose a
Chairperson of the Board and a Vice Chairperson of the Board from among its
members. The Board of Directors may also choose one or more Vice Presidents, one
or more Assistant Secretaries, a Treasurer and one or more Assistant Treasurers
and such other officers as it shall from time to time deem necessary or
desirable. Each such officer shall hold office until the first meeting of the
Board of Directors after the annual meeting of stockholders next succeeding his
or her election, and until his or her successor is elected and qualified or
until his or her earlier resignation or removal. Any officer may resign at any
time upon written notice to the corporation. The Board of Directors may remove
any officer with or without cause at any time, but such removal shall be without
prejudice to the contractual rights of such officer, if any, with the
corporation. Any number of offices may be held by the same person. Any vacancy
occurring in any office of the corporation by death, resignation, removal or
otherwise may be filled for the unexpired portion of the term by the Board of
Directors at any regular or special meeting.

                  Section 4.2. Powers and Duties of Executive Officers. The
officers of the corporation shall have such powers and duties in the management
of the corporation as may be prescribed in a resolution by the Board of
Directors and, to the extent not so provided, as generally pertain to their
respective offices, subject to the control of the Board of Directors. The Board
of Directors may require any officer, agent or employee to give security for the
faithful performance of his or her duties.

                  Section 4.3. Appointing Attorneys and Agents; Voting
Securities of Other Entities. Unless otherwise provided by resolution adopted by
the Board of Directors, the Chairperson of the Board, the President or any Vice
President may from time to time appoint an attorney or attorneys or agent or
agents of the corporation, in the name and on behalf of the corporation, to cast
the votes which the corporation may be entitled to cast as the holder of stock
or other securities in any other corporation or other entity, any of whose stock
or other securities may be held by the corporation, at meetings of the holders
of the stock or other securities of such other corporation or other entity, or
to consent in writing, in the name of the corporation as such holder, to any
action by such other corporation or other entity, and may instruct the person or
persons so appointed as to the manner of casting such votes or giving such
consents, and may execute or cause to be executed in the name and on behalf of
the corporation and under its corporate seal or otherwise, all such written
proxies or other instruments as he or she may deem necessary or proper. Any of
the rights set forth in this Section 4.3 which may be delegated to an attorney
or agent may also be exercised directly by the Chairperson of the Board, the
President or the Vice President.

                                      -9-


                                    ARTICLE V

                                      Stock

                  Section 5.1. Certificates. Every holder of stock shall be
entitled to have a certificate signed by or in the name of the corporation by
the Chairperson or Vice Chairperson of the Board of Directors, if any, or the
President or a Vice President, and by the Treasurer or an Assistant Treasurer,
or the Secretary or an Assistant Secretary, of the corporation certifying the
number of shares owned by such holder in the corporation. Any of or all the
signatures on the certificate may be a facsimile. In case any officer, transfer
agent or registrar who has signed or whose facsimile signature has been placed
upon a certificate shall have ceased to be such officer, transfer agent, or
registrar before such certificate is issued, it may be issued by the corporation
with the same effect as if such person were such officer, transfer agent, or
registrar at the date of issue.

                  Section 5.2. Lost, Stolen or Destroyed Stock Certificates;
Issuance of New Certificates. The corporation may issue a new certificate of
stock in the place of any certificate theretofore issued by it, alleged to have
been lost, stolen or destroyed, and the corporation may require the owner of the
lost, stolen or destroyed certificate, or such owner's legal representative, to
give the corporation a bond sufficient to indemnify it against any claim that
may be made against it on account of the alleged loss, theft or destruction of
any such certificate or the issuance of such new certificate.



                                   ARTICLE VI

                                 Indemnification

                  Section 6.1. Right to Indemnification. The corporation shall
indemnify and hold harmless, to the fullest extent permitted by applicable law
as it presently exists or may hereafter be amended, any person (a "Covered
Person") who was or is made or is threatened to be made a party or is otherwise
involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a "proceeding"), by reason of the fact that he
or she, or a person for whom he or she is the legal representative, is or was a
director or officer of the corporation or, while a director or officer of the
corporation, is or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation or of a partnership, joint
venture, trust, enterprise or nonprofit entity, including service with respect
to employee benefit plans, against all liability and loss suffered and expenses
(including attorneys' fees) reasonably incurred by such Covered Person.
Notwithstanding the preceding sentence, except as otherwise provided in Section
6.3, the corporation shall be required to indemnify a Covered Person in
connection with a proceeding (or part thereof) commenced by such Covered Person
only if the commencement of such proceeding (or part thereof) by the Covered
Person was authorized in the specific case by the Board of Directors of the
corporation.

                  Section 6.2. Prepayment of Expenses. The corporation shall to
the fullest extent not prohibited by applicable law pay the expenses (including
attorneys' fees) incurred by a Covered Person in defending any proceeding in
advance of its final disposition, provided, however, that, to the extent
required by law, such payment of expenses in advance of the final disposition of
the proceeding shall be made only upon receipt of an undertaking by the Covered
Person to repay all amounts advanced if it should be ultimately determined that
the Covered Person is not entitled to be indemnified under this Article VI or
otherwise.

                  Section 6.3. Claims. If a claim for indemnification (following
the final disposition of such action, suit or proceeding) or advancement of
expenses under this Article VI is not paid in full within thirty days after a
written claim therefor by the Covered Person has been received by the
corporation, the Covered Person may file suit to recover the unpaid amount of
such claim and, if successful in whole or in part, shall be entitled to be paid
the expense of prosecuting such claim. In any such action the corporation shall
have the burden of proving that the Covered Person is not entitled to the
requested indemnification or advancement of expenses under applicable law.

                  Section 6.4. Nonexclusivity of Rights. The rights conferred on
any Covered Person by this Article VI shall not be exclusive of any other rights
which such Covered Person may have or hereafter acquire under any statute,
provision of the certificate of incorporation, these by-laws, agreement, vote of
stockholders or disinterested directors or otherwise.

                  Section 6.5. Other Sources. The corporation's obligation, if
any, to indemnify or to advance expenses to any Covered Person who was or is
serving at its request as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, enterprise or nonprofit entity
shall be reduced by any amount such Covered Person may collect as

                                       11


indemnification or advancement of expenses from such other corporation,
partnership, joint venture, trust, enterprise or non-profit enterprise.

                  Section 6.6. Amendment or Repeal. Any repeal or modification
of the foregoing provisions of this Article VI shall not adversely affect any
right or protection hereunder of any Covered Person in respect of any act or
omission occurring prior to the time of such repeal or modification.

                  Section 6.7. Other Indemnification and Prepayment of Expenses.
This Article VI shall not limit the right of the corporation, to the extent and
in the manner permitted by law, to indemnify and to advance expenses to persons
other than Covered Persons when and as authorized by appropriate corporate
action.

                                       12


                                   ARTICLE VII

                                  Miscellaneous

                  Section 7.1. Fiscal Year. The fiscal year of the corporation
shall be determined by resolution of the Board of Directors.

                  Section 7.2. Seal. The corporate seal shall have the name of
the corporation inscribed thereon and shall be in such form as may be approved
from time to time by the Board of Directors.

                  Section 7.3. Manner of Notice. Except as otherwise provided
herein or permitted by applicable law, notices to directors and stockholders
shall be in writing and delivered personally or mailed to the directors or
stockholders at their addresses appearing on the books of the corporation.
Notice to directors may be given by telecopier, telephone or other means of
electronic transmission.

                  Section 7.4. Waiver of Notice of Meetings of Stockholders,
Directors and Committees. Any waiver of notice, given by the person entitled to
notice, whether before or after the time stated therein, shall be deemed
equivalent to notice. Attendance of a person at a meeting shall constitute a
waiver of notice of such meeting, except when the person attends a meeting for
the express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at nor the purpose of any
regular or special meeting of the stockholders, directors, or members of a
committee of directors need be specified in a waiver of notice.

                  Section 7.5. Form of Records. Any records maintained by the
corporation in the regular course of its business, including its stock ledger,
books of account, and minute books, may be kept on, or by means of, or be in the
form of, any information storage device or method, provided that the records so
kept can be converted into clearly legible paper form within a reasonable time.

                  Section 7.6. Amendment of By-Laws. These by-laws may be
altered, amended or repealed, and new by-laws made, by the Board of Directors,
but the stockholders may make additional by-laws and may alter and repeal any
by-laws whether adopted by them or otherwise.

                  Section 7.7 Execution of Instruments. Contracts, documents or
instruments in writing requiring the signature of the corporation may be signed
by:

                  (a)      any two officers;

                  (b)      any two directors; or

                  (c)      any one officer together with any one director;

and all contracts, documents and instruments in writing so signed shall be
binding upon the corporation without any further authorization or formality. The
Board of Directors shall have

                                       13


power from time to time to appoint any person or persons, on behalf of the
corporation either to sign contracts, documents and instruments in writing
generally or to sign specific contracts, documents or instruments in writing.

                  The corporate seal of the corporation, if any, may be affixed
to contracts, documents and instruments in writing signed as aforesaid or by any
person or persons appointed as aforesaid by the Board of Directors but any such
contract, document or instrument is not invalid merely because the corporate
seal, if any, is not affixed thereto.

                  The term "contracts, documents or instruments in writing" as
used in this by-law shall include deeds, mortgages, hypothecs, charges,
conveyances, transfers and assignments of property real or personal, immovable
or movable, agreements, releases, receipts and discharges for the payment of
money or other obligations, conveyances, transfers and assignments of shares,
share warrants, stocks, bonds debentures or other securities and all paper
writings.

                  In particular without limiting the generality of the foregoing

                  (a)      any two officers;

                  (b)      any two directors; or

                  (c)      any one officer together with any one director;

shall have authority to sell, assign, transfer, exchange, convert or convey any
and all shares, stocks, bonds, debentures, rights, warrants or other securities
owned by or registered in the name of the corporation and to sign and execute
(under the seal of the corporation or otherwise) all assignments, transfers,
conveyances, powers of attorney and other instruments that may be necessary for
the purpose of selling, assigning, transferring, exchanging, converting or
conveying any such shares, stocks, bonds, debentures, rights, warrants or other
securities.

                  The signature or signatures of any officer or officers, or any
director or directors of the corporation and/or of any other person or persons,
appointed as aforesaid by the Board of Directors may, if specifically authorized
by the Board of Directors, be printed, engraved, lithographed or otherwise
mechanically reproduced upon any contracts, documents or instruments in writing
or bonds, debentures or other securities of the corporation executed or issued
by or on behalf of the corporation and all contracts, documents or instruments
in writing or bonds, debentures or other securities of the corporation on which
the signature or signatures of any one or more of the foregoing officers or
directors or the officers or persons authorized as aforesaid shall be so
reproduced pursuant to such authorization, by the Board of Directors shall be
deemed to have been manually signed by each such officer, director or person
whose signature is so reproduced and shall be as valid to all intents and
purposes as if they had been signed manually and notwithstanding that any such
officer, director or person whose signature is so reproduced may have ceased to
hold office at the date of the delivery or issue of such contracts, documents or
instruments in writing or bonds, debentures or other securities of the
corporation.

                                       14

EX-4.6

                             SUPPLEMENTAL INDENTURE


     Supplemental Indenture (this "Supplemental Indenture"), dated as of
April 1, 2004 among IMAX Corporation, a corporation incorporated under the
federal laws of Canada (the "Company"), the Guarantors named in the Indenture
referred to below (the "Existing Guarantors"), Taurus-Littrow Productions Inc.
and 3D Sea II Ltd. (each, a "Guaranteeing Subsidiary") and U.S. Bank National
Association, as trustee under the Indenture referred to below (the "Trustee").


                               W I T N E S S E T H

     WHEREAS, the Company and the Existing Guarantors have heretofore executed
and delivered to the Trustee an indenture (the "Indenture"), dated as of
December 4, 2003, providing for the issuance of 9 5/8% Senior Notes due 2010
(the "Securities");

     WHEREAS, the Indenture provides that under certain circumstances each
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which any newly-acquired or created Guarantor shall
unconditionally guarantee all of the Company's obligations under the Securities
and the Indenture on the terms and conditions set forth herein (the "Subsidiary
Guarantee"); and

     WHEREAS, pursuant to Section 901 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.

     NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, each
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Securities as follows:

     1.  Capitalized Terms. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.

     2.  Agreement to Guarantee. Each Guaranteeing Subsidiary irrevocably and
unconditionally guarantees the Guarantee Obligations, which include (i) the due
and punctual payment of the principal of, premium, if any, and interest and
Special Interest, if any, on the Securities, whether at maturity, by
acceleration, redemption, upon a Change of Control Offer, upon an Asset Sale
Offer or otherwise, the due and punctual payment of interest on the overdue
principal and premium, if any, and (to the extent permitted by law) interest on
any interest on the Securities, and payment of expenses, and the due and
punctual performance of all other obligations of the Company, to the Holders or
the Trustee all in accordance with the terms set forth in Article XIII of the
Indenture, and (ii) in case of any extension of time of payment or renewal of
any Securities or any such other obligations, that the same will be promptly
paid in full when due or performed in accordance with the terms of the extension
or renewal, whether at stated maturity, by acceleration, redemption, upon a
Change of Control Offer, upon an Asset Sale Offer or otherwise.

     The obligations of each Guaranteeing Subsidiary to the Holders and to the
Trustee pursuant to this Subsidiary Guarantee and the Indenture are expressly
set forth in Article XIII of the Indenture and reference is hereby made to such
Indenture for the precise terms of this Subsidiary Guarantee.

     No past, present or future director, officer, partner, manager, employee,
incorporator or stockholder (direct or indirect) of either of the Guaranteeing
Subsidiaries (or any such successor entity), as such, shall have any liability
for any obligations of such Guaranteeing Subsidiary under this Subsidiary
Guarantee or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation, except in their capacity as an
obligor or Guarantor of the Securities in accordance with the Indenture.

     This is a continuing Guarantee and shall remain in full force and effect
and shall be binding upon each Guaranteeing Subsidiary and its successors and
assigns until full and final payment of all of the Company's obligations under
the Securities and Indenture or until released in accordance with the Indenture
and shall inure to the benefit of the successors and assigns of the Trustee and
the Holders, and, in the event of any transfer or assignment of rights by any
Holder or the Trustee, the rights and privileges herein conferred upon that
party shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions hereof. This is a Guarantee of
payment and not of collectibility.






     The obligations of each Guaranteeing Subsidiary under its Subsidiary
Guarantee shall be limited to the extent necessary to insure that it does not
constitute a fraudulent conveyance under applicable law.

     THE TERMS OF ARTICLE XIII OF THE INDENTURE ARE INCORPORATED HEREIN BY
REFERENCE.

     3.  NEW YORK LAW TO GOVERN. THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN
AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.

     4.  Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.

     5.  Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.







     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.

                               IMAX Corporation


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Sr. Vice President, Legal Affairs


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President Finance, Special Projects


                               EXISTING GUARANTORS:

                               David Keighley Productions 70MM Inc.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX II U.S.A. Inc.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                                       3


                               IMAX Chicago Theatre LLC
                               By its Managing Member
                               IMAX Theatre Holding (California I) Co.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX Forum Ride, Inc.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX Minnesota Holding Co.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX Rhode Island Limited Partnership
                               By its General Partner
                               IMAX Providence General Partner Co.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President


                                       4


                               IMAX Sandde Animation Inc.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX Scribe Inc.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX Space Ltd.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                               IMAX Theatre Holding Co.


                               By /s/ G. Mary Ruby
                                 -----------------------------------
                               Name:  G. Mary Ruby
                               Title: Secretary


                               By /s/ Edward MacNeil
                                 -----------------------------------
                               Name:  Edward MacNeil
                               Title: Vice President



                                       5


                                IMAX Theatre Holdings (OEI) Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Management Company


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Services Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX U.S.A. Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       6



                                Miami Theatre LLC
                                By its Managing Member
                                IMAX Theatre Holding (California I) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Mitey Cinema Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President


                                Mountainview Theatre Management Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Nyack Theatre LLC
                                By its Managing Member
                                IMAX Theatre Holding (Nyack I) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                   -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       7



                                Ridefilm Corporation


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Sacramento Theatre LLC
                                By its Managing Member
                                IMAX Theatre Holding (California I) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Sonics Associates, Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Starboard Theatres Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       8



                                Tantus Films Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Wire Frame Films Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                1329507 Ontario Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                924689 Ontario Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       9



                                IMAX (Titanica) Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX (Titanic) Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Music Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Holding (Brossard) Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President




                                       10



                                IMAX Film Holding Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Indianapolis LLC


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Pictures Corporation


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Immersive Entertainment Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       11



                                IMAX Providence General Partner Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Providence Limited Partner Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Holding (California I) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Holding (California II) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       12



                                IMAX Theatre Holding (Nyack I) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Holding (Nyack II) Co.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                IMAX Theatre Management (Scottsdale), Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Panda Productions Inc.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       13



                                Strategic Sponsorship Corporation


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                Tantus II Films Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                RPM Pictures Ltd.


                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                GUARANTEEING SUBSIDIARIES:



                                Taurus-Littrow Productions Inc.



                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President



                                       14



                                3D Sea II Ltd.



                                By /s/ G. Mary Ruby
                                  -----------------------------------
                                Name:  G. Mary Ruby
                                Title: Secretary


                                By /s/ Edward MacNeil
                                  -----------------------------------
                                Name:  Edward MacNeil
                                Title: Vice President


                                       15



                                TRUSTEE:

                                U.S. Bank National Association,
                                        As Trustee


                                By: /s/ Frank P. Leslie III
                                   ---------------------------------------
                                Name:  Frank P. Leslie III
                                Title: Vice President




                                       16

EX-5.1

                             SHEARMAN & STERLING LLP

                       Commerce Court West, 199 Bay Street
                            P.O. Box 247, Suite 4405
                                Toronto, Ontario
                                 Canada M5L 1E8
                                 (416) 360-8484
                              (416) 360-2958 (fax)

                                  May 4, 2004

IMAX Corporation
2525 Speakman Drive
Mississauga, Ontario L5K 1B1


                                IMAX Corporation

Ladies and Gentlemen:


         We have acted as special United States counsel to IMAX Corporation, a
Canadian corporation (the "Company"), in connection with the preparation of the
registration statement on Form S-4 (the "Registration Statement") filed on
February 27, 2004 with the Securities and Exchange Commission (the "Commission")
under the Securities Act of 1933, as amended (the "Act"), as amended by
amendment no. 1 ("Amendment No. 1") to the Registration Statement, to be filed
with the Commission, relating to the exchange offer, as set forth in the
prospectus contained in the Registration Statement (the "Prospectus"), by the
Company of up to $160,000,000 aggregate principal amount of its 9 5/8% Senior
Notes due 2010 which are to be registered under the Act (the "Registered Notes")
in exchange for its outstanding 9 5/8% Senior Notes due 2010 issued on December
4, 2003 (the "Outstanding Notes"). The Registered Notes are to be fully and
unconditionally guaranteed on a senior basis, jointly and severally, by each of
the Original Guarantors (as defined below) as to payment of principal, premium,
if any, and interest (the "Guarantees"). The Registered Notes and the Guarantees
are to be issued under an indenture dated as of December 4, 2003 (the
"Indenture"), among the Company, each of the Company's subsidiaries signatory
thereto (the "Original Guarantors") and U.S. Bank National Association, as
trustee (the "Trustee"), as supplemented by the supplemental indenture dated
April o, 2004 (the "Supplemental Indenture") among the Company, the Original
Guarantors, 3D Sea II Ltd. and Taurus-Littrow Productions Inc. (together with
the Original Guarantors, the "Guarantors") and the Trustee.

         In such capacity, we have examined the Registration Statement,
Amendment No. 1, specimens of the global certificate relating to the Registered
Notes, including the Guarantees, and the originals, or copies identified to our
satisfaction, of such corporate records of the Company and the Guarantors,
certificates of public officials, officers of the Company and the Guarantors and
other persons, and such other documents, agreements and instruments as we have
deemed necessary as a basis for the opinions hereinafter expressed. In our
examinations, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies. We have also
assumed that the Indenture and the Supplemental Indenture have been duly
authorized, executed and delivered by the Trustee.




         Our opinions expressed below are limited to the laws of the State of
New York, and we do not express any opinion herein concerning any other law.

         Based upon the foregoing, we are of the opinion that when the
Registered Notes and the Guarantees endorsed thereon have been duly authorized,
executed and delivered by the Company and the Guarantors, as applicable, and the
Registered Notes have been authenticated by the Trustee in accordance with the
Indenture and exchanged for the Outstanding Notes as contemplated in the
Registration Statement, the Registered Notes and the Guarantees endorsed thereon
will constitute legal, valid and binding obligations of the Company and each
Guarantor, respectively, enforceable against the Company and each Guarantor, as
the case may be, in accordance with their terms. The foregoing opinion is
subject to the qualification that enforcement of the terms is subject to the
effect of any applicable bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting creditors' rights generally and subject to the effect of
general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
enforcement is considered in a proceeding in equity or at law).

         We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement and to the use of our name under the
heading "Legal Matters" in the Prospectus. In giving such consent, we do not
hereby admit that we are in the category of persons whose consent is required
under Section 7 of the Act and the rules and regulations of the Commission
promulgated thereunder.

                                       Very truly yours,

                                       /s/ Shearman and Sterling LLP


                                       2

EX-5.2

May 4, 2004


IMAX Corporation
2525 Speakman Drive
Mississauga, Ontario L5K 1B1


                                IMAX Corporation
                     $160,000,000 9 5/8% Senior Notes due 2010

Ladies and Gentlemen:

                  I, Robert D. Lister, Executive Vice President, Business and
Legal Affairs and General Counsel of IMAX Corporation, a Canadian corporation
(the "Company"), licensed to practice law in the State of New York, have agreed
to provide an in-house legal opinion in connection with the registration
statement on Form S-4 (the "Registration Statement") filed with the Securities
and Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act") on February 27, 2004, as amended by amendment no. 1 to the
Registration Statement ("Amendment No. 1"), to be filed with the Commission,
relating to the exchange offer, as set forth in the prospectus contained in the
Registration Statement (the "Prospectus"), by the Company of up to $160,000,000
aggregate principal amount of its 9 5/8% Senior Notes due 2010 which are to be
registered under the Act(the "Registered Notes") in exchange for its outstanding
9 5/8% Senior Notes due 2010 issued on December 4, 2003 (the "Outstanding
Notes"). The Registered Notes are to be fully and unconditionally guaranteed on
a senior basis, jointly and severally, by each of the Original Guarantors (as
defined below) as to payment of principal, premium, if any, and interest (the
"Guarantees"). The Registered Notes and the Guarantees are to be issued under an
indenture dated as of December 4, 2003 (the "Indenture"), between the Company,
each of the Company's subsidiaries signatory thereto (the "Original Guarantors")
and U.S. Bank National Association, as trustee (the "Trustee"), as supplemented
by the supplemental indenture dated April 1, 2004 (the "Supplemental Indenture")
among the Company, the Original Guarantors, Taurus-Littrow Productions Inc. and
3D Sea II Ltd. (together with the Original Guarantors, the "Guarantors") and the
Trustee.

                  In such capacity, I have examined the Registration Statement,
Amendment No. 1, specimens of the global certificate relating to the Registered
Notes, including the Guarantees, and the originals, or copies identified to my
satisfaction, of such corporate records of the Company and the Guarantors,
certificates of public officials, officers of the Company and the Guarantors and
other persons, and such other documents, agreements and instruments as I have
deemed necessary as a basis for the opinions hereinafter expressed. In my
examinations, I have assumed the genuineness of all signatures, the authenticity
of all documents submitted to me as originals and the conformity with the
originals of all documents submitted to us as copies.

                  The opinions set forth below are limited to the laws of the
jurisdictions of incorporation or formation of the Company and the Guarantors
and I do not express any opinion herein concerning any other laws.

                  Based upon the foregoing, I am of the opinion that (i) the
execution and delivery by the Company of the Registered Notes have been duly
authorized by the Company and (ii) the execution and delivery by each of the
Guarantors of the Guarantees have been duly authorized by each of the
Guarantors.






         I hereby consent to the filing of this opinion with the Commission as
an exhibit to Amendment No. 1. In giving such consent, I do not hereby admit
that I am in the category of persons whose consent is required under Section 7
of the Act and the rules and regulations of the Commission promulgated
thereunder.

                                             Very truly yours,



                                             /s/ Robert D. Lister
                                             -----------------------------------
                                             Robert D. Lister
                                             Executive Vice President, Business
                                             and Legal Affairs and General
                                             Counsel of IMAX Corporation



                                       2

EX-12.1

                                IMAX CORPORATION
                COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES


     For the purpose of computing the ratios of earnings to fixed charges,
"earnings" consist of earnings (loss) from continuing operations before income
taxes and minority interest, loss (income) from equity-accounted investees,
capitalized interest, amortization of capitalized interest and fixed charges.
"Fixed charges" consist of interest expense, amortization of expenses related to
indebtedness (which are included in interest expense), capitalized interest and
an estimate of the interest within rental expense, deemed to be one-third of
rental expense. Due to losses incurred by IMAX Corporation, the ratio coverage
in certain years is less than 1:1. IMAX Corporation would have had to generate
additional earnings of $39.0 million in 2000, $62.7 million in 2001 and $2.6
million in 2003 to achieve a ratio of 1:1 in those periods.




                                                                         YEARS ENDED DECEMBER 31,
                                                             -------------------------------------------------
                                                              1999       2000       2001      2002      2003
                                                             -------   --------   --------   -------   -------
                                                                     (IN THOUSANDS EXCEPT RATIO DATA)
                                                                                        
Earnings (loss) from continuing operations before income
  taxes and minority interest..............................  $44,864   $(39,311)  $(63,988)  $11,168   $  (168)
Loss (income) from equity-accounted investees..............      683      4,811        (73)     (283)   (2,496)
Capitalized interest.......................................     (754)    (1,393)      (511)       --        --
Amortization of capitalized interest.......................       44        500      1,853        26        26
                                                             -------   --------   --------   -------   -------
                                                              44,837    (35,393)   (62,719)   10,911    (2,638)
                                                             -------   --------   --------   -------   -------
Fixed Charges:
  Interest expense.........................................   21,860     21,961     22,020    17,564    15,856
  Capitalized interest.....................................      754      1,393        511        --        --
  Estimate of the interest within rental expense...........      822      1,633      1,711     1,168     1,321
                                                             -------   --------   --------   -------   -------
  Total fixed charges......................................   23,436     24,987     24,242    18,732    17,177
                                                             -------   --------   --------   -------   -------
Earnings...................................................  $68,273   $(10,406)  $(38,477)  $29,643   $14,539
                                                             =======   ========   ========   =======   =======
Ratio of earnings to fixed charges.........................     2.91x        --         --      1.58x       --

EX-21.1

Exhibit 21.1

OWNERSHIP OF U.S. CONSOLIDATED GROUP CANADA Imax Theatre Holding (Nyack II) Co. IMAX Corporation David Keighley Productions 70MM Inc. Imax Theatre Management (Scottsdale) Inc. Imax II USA Inc. Ridefilm Corporation Imax Pictures Corporation Strategic Sponsorship Corporation 100% 100% 100% 100% 100% 100% 100% UNITED STATES Imax U.S.A. Inc. 100% Imax Forum Ride Inc. 1% 49% Imax Theatre Holdings (OEI) Inc. 100% Arizona Big Frame Theatre LLC 100% Imax Providence Limited Partner Co. 100% Imax Theatre Holding (California II) Co. 100% 100% Imax Providence General Partner Co. 100% Imax Theatre Holding (California I) Co. 100% Imax Theatre Holding (Nyack I) Co. 100% Imax Theatre Holding Co. 100% Immersive Entertainment Inc. 100% Imax Scribe Inc. 100% Imax Theatre Management Company 100% Imax Rhode Island Limited Partnership 99% 1% Miami Theatre LLC Sacramento Theatre LLC Nyack Theatre LLC 99% 99% 1% 1% 1% 99% Big Frame Theatre Ltd. Partnership S:\77data\2000client\i-m\imax\charts01.ppt Imax Film Holding Co. 100% Imax Minnesota Holding Co. 100% 50% SGB Partners .. Outside Parties with holdings 100% Panda Productions Inc. 100% 50% PSE, LLC Sonics Associates Inc. 50% Various Executives of Oxmoor Corporation LLC Imax Indianapolis LLC Imax Chicago Theatre LLC 99% 1% 100% 100% Taurus-Littrow Productions Inc. Guarantors

OWNERSHIP OF CANADIAN AND OTHER FOREIGN CONSOLIDATED GROUP CANADA IMAX Corporation 924689 Ontario Inc. Tantus Films Ltd. IMAX Music Ltd. IMAX Space Ltd. IMAX Sandde Animation Inc. 100% 100% 100% 100% 100% 100% 878646 Ontario Limited Imax Theatre Services Ltd. 100% 100% IMAX Corporation IMAX (Titanica) Ltd. 100% IMAX Theatre Holding (Brossard) Inc. 100% Wire Frame Films Ltd. 100% Imax (Titanic) Inc. (U.S. Sub) 50% IMAX (Netherlands) B.V. IMAX Entertainment Pte Ltd. (in liquidation) IMAX Japan Inc. Mountainview Theatre Management Ltd. 100% 100% S:\77data\2000client\i-m\imax\charts01.ppt Mitey Cinema Inc. 100% 100% 100% RPM Pictures Ltd. 100% 100% 1329507 Ontario Inc. Starboard Theatres Ltd. OTHER FOREIGN 100% Tantus II Films Ltd. 100% 3D Sea II Ltd. Guarantors

EX-23.1

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

                        CONSENT OF INDEPENDENT AUDITORS

We refer to amendment no. 1 to the registration statement on Form S-4
("Amendment No. 1") filed by IMAX Corporation (the "Company") under the
Securities Act of 1933, as amended.

We hereby consent to the incorporation by reference in Amendment No. 1 of our
report dated February 27, 2004 with respect to the consolidated balance sheets
of the Company as at December 31, 2003 and 2002 and the consolidated statements
of operations, cash flows and shareholders' equity (deficit) for each year in
the three-year period ended December 31, 2003 prepared in accordance with
generally accepted accounting principles in the United States of America. We
also consent to the reference to us under the heading "Experts" in such
Amendment No. 1.


/s/ PricewaterhouseCoopers LLP
- ---------------------------------
PricewaterhouseCoopers LLP
Chartered Accountants
May 6, 2004

EX-25.1

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                           --------------------------

                                    FORM T-1

                         STATEMENT OF ELIGIBILITY UNDER
                      THE TRUST INDENTURE ACT OF 1939 OF A
                    CORPORATION DESIGNATED TO ACT AS TRUSTEE

               Check if an Application to Determine Eligibility of
                    a Trustee Pursuant to Section 305(b)(2) [ ]

             -------------------------------------------------------

                         U.S. BANK NATIONAL ASSOCIATION
               (Exact name of Trustee as specified in its charter)

                                   31-0841368
                      (I.R.S. Employer Identification No.)


                800 Nicollet Mall
             Minneapolis, Minnesota                      55402
     ----------------------------------------    -----------------------
     (Address of principal executive offices)         (Zip Code)


                                  Frank Leslie
                         U.S. Bank National Association
                              60 Livingston Avenue
                               St. Paul, MN 55107
                                 (651) 495-3913
            (Name, address and telephone number of agent for service)

                           --------------------------

                                IMAX CORPORATION
               (Exact name of obligor as specified in its charter)


               Canada                                  98-0140269
- ----------------------------------------   ------------------------------------
   (State or other jurisdiction of         (I.R.S. Employer Identification No.)
    incorporation or organization)


          2525 Speakman Drive
     Mississauga, Ontario, Canada                       L5K 1B1
- ----------------------------------------   ------------------------------------
(Address of Principal Executive Offices)              (Zip Code)


                        SEE TABLE OF ADDITIONAL OBLIGORS

                           --------------------------

                          9 5/8% SENIOR NOTES DUE 2010
                       (Title of the indenture securities)

================================================================================





                          TABLE OF ADDITIONAL OBLIGORS




EXACT NAME OF ADDITIONAL OBLIGOR           JURISDICTION OF           IRS EMPLOYER         PRINCIPAL EXECUTIVE OFFICE
                                              FORMATION           IDENTIFICATION NO.
- --------------------------------           ---------------        ------------------   ----------------------------------
                                                                              

1329507 ONTARIO INC.                            Ontario                   --                   2525 Speakman Drive,
                                                                                           Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

3D SEA II LTD.                                  Ontario                   --                   2525 Speakman Drive,
                                                                                           Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

924689 ONTARIO INC.                             Ontario                   --                   2525 Speakman Drive,
                                                                                           Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

DAVID KEIGHLEY PRODUCTIONS 70MM INC.           Delaware               95-3996963          110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX (TITANIC) INC.                            Delaware               98-0123185          110 E. 59th Street, Suite 2100
                                                                                             New York, New York 10022
                                                                                               phone: (212) 821-0100

IMAX (TITANICA) LTD.                            Ontario                   --                   2525 Speakman Drive,
                                                                                           Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

IMAX CHICAGO THEATRE LLC                       Delaware               82-0565362          110 E. 59th Street, Suite 2100
                                                                                             New York, New York 10022
                                                                                               phone: (212) 821-0100

IMAX FILM HOLDING CO.                          Delaware                   --              110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX FORUM RIDE, INC.                           Nevada                88-0360462          110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX II U.S.A. INC.                            Delaware               51-0373323          110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX INDIANAPOLIS LLC                           Indiana                   --              110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX MINNESOTA HOLDING CO.                     Delaware               52-2254901          110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX MUSIC LTD.                                 Ontario                   --                   2525 Speakman Drive,
                                                                                           Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

IMAX PICTURES CORPORATION                      Delaware               98-0153647          110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

IMAX PROVIDENCE GENERAL PARTNER CO.            Delaware               52-2054994          110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100









EXACT NAME OF ADDITIONAL OBLIGOR             JURISDICTION OF           IRS EMPLOYER         PRINCIPAL EXECUTIVE OFFICE
                                                FORMATION           IDENTIFICATION NO.
- --------------------------------             ---------------        ------------------   ----------------------------------
                                                                                

IMAX PROVIDENCE LIMITED PARTNER CO.              Delaware               52-2054995         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX RHODE ISLAND LIMITED PARTNERSHIP          Rhode Island             98-0176677         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX SANDDE ANIMATION INC.                        Ontario                   --                  2525 Speakman Drive,
                                                                                            Mississauga, Ontario L5K 1B1
                                                                                                phone: (905) 403-6500

IMAX SCRIBE INC.                                 Delaware               51-0373325         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX SPACE LTD.                                   Ontario                   --                  2525 Speakman Drive,
                                                                                            Mississauga, Ontario L5K 1B1
                                                                                                phone: (905) 403-6500

IMAX THEATRE HOLDING (BROSSARD) INC.              Canada                    --                  2525 Speakman Drive,
                                                                                            Mississauga, Ontario L5K 1B1
                                                                                                phone: (905) 403-6500

IMAX THEATRE HOLDING (CALIFORNIA I) CO.          Delaware               52-2054998         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE HOLDING (CALIFORNIA II) CO.         Delaware               52-2054999         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE HOLDING (NYACK I) CO.               Delaware               52-2055001         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE HOLDING (NYACK II) CO.              Delaware               52-2055002         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE HOLDING CO.                         Delaware               52-2054997         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE HOLDINGS (OEI) INC.                 Delaware               52-2054993         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE MANAGEMENT (SCOTTSDALE), INC.        Arizona               86-0686026         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE MANAGEMENT COMPANY                  Delaware               52-2054996         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100

IMAX THEATRE SERVICES LTD.                        Ontario                   --                  2525 Speakman Drive,
                                                                                            Mississauga, Ontario L5K 1B1
                                                                                                phone: (905) 403-6500

IMAX U.S.A. INC.                                 Delaware               98-0159490         110 E. 59th Street, Suite 2100
                                                                                              New York, New York 10022
                                                                                                phone: (212) 821-0100










EXACT NAME OF ADDITIONAL OBLIGOR           JURISDICTION OF           IRS EMPLOYER         PRINCIPAL EXECUTIVE OFFICE
                                              FORMATION           IDENTIFICATION NO.
- --------------------------------           ---------------        ------------------   ----------------------------------
                                                                              

IMMERSIVE ENTERTAINMENT INC.                   Delaware               98-0153646         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

MIAMI THEATRE LLC                              Delaware               65-0888857         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

MITEY CINEMA INC.                               Ontario                   --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

MOUNTAINVIEW THEATRE MANAGEMENT LTD.            Alberta                   --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

NYACK THEATRE LLC                              New York               98-0202278         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

PANDA PRODUCTIONS INC.                         Delaware               95-4785483         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

RIDEFILM CORPORATION                           Delaware               04-3222960         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

RPM PICTURES LTD.                               Ontario                   --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

SACRAMENTO THEATRE LLC                         Delaware               68-0432572         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

SONICS ASSOCIATES, INC.                         Alabama               63-0623302         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

STARBOARD THEATRES LTD.                         Canada                    --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

STRATEGIC SPONSORSHIP CORPORATION              Delaware               52-1723753         110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

TANTUS FILMS LTD.                               Canada                    --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

TANTUS II FILMS LTD.                            Ontario                   --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500

TAURUS-LITTROW PRODUCTIONS INC.                Delaware                   --             110 E. 59th Street, Suite 2100
                                                                                            New York, New York 10022
                                                                                              phone: (212) 821-0100

WIRE FRAME FILMS LTD.                           Ontario                   --                  2525 Speakman Drive,
                                                                                          Mississauga, Ontario L5K 1B1
                                                                                              phone: (905) 403-6500






                                    FORM T-1

ITEM 1.   GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE
          TRUSTEE.

          a)   Name and address of each examining or supervising authority to
               which it is subject.

                    Comptroller of the Currency
                    Washington, D.C.

          b)   Whether it is authorized to exercise corporate trust powers.

                    Yes

ITEM 2.   AFFILIATIONS WITH OBLIGORS. IF ANY OF THE OBLIGORS IS AN AFFILIATE OF
          THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION.

          None.

ITEMS 3-15.   Items 3-15 are not applicable because to the best of the Trustee's
              knowledge, none of the obligors is in default under any indenture
              for which the Trustee acts as trustee.

ITEM 16.  LIST OF EXHIBITS: LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS
          STATEMENT OF ELIGIBILITY AND QUALIFICATION.

          1.   A copy of the Articles of Association of the Trustee.*

          2.   A copy of the certificate of authority of the Trustee to commence
               business.*

          3.   A copy of the certificate of authority of the Trustee to exercise
               corporate trust powers.*

          4.   A copy of the existing bylaws of the Trustee.*

          6.   The consent of the Trustee required by Section 321(b) of the
               Trust Indenture Act of 1939.


          7.   Report of Condition of the Trustee as of December 31, 2003,
               published pursuant to law or the requirements of its supervising
               or examining authority.




     * Incorporated by reference to Registration Statement No. 333-67188.






                                      NOTE

     The answers to this statement insofar as such answers relate to what
persons have been underwriters for any securities of the obligors within three
years prior to the date of filing this statement, or what persons are owners of
10% or more of the voting securities of the obligors, or affiliates, are based
upon information furnished to the Trustee by the obligors. While the Trustee has
no reason to doubt the accuracy of any such information, it cannot accept any
responsibility therefor.



                                    SIGNATURE


     Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the Trustee, U.S. BANK NATIONAL ASSOCIATION, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility and qualification to be
signed on its behalf by the undersigned, thereunto duly authorized, all in the
City of St. Paul, State of Minnesota on the 1st day of April, 2004.




                                            U.S. BANK NATIONAL ASSOCIATION


                                            By: /s/ Frank P. Leslie III
                                                --------------------------------
                                                Frank P. Leslie III
                                                Vice President



                                            By: /s/ Richard H. Prokosch
                                                --------------------------------
                                                Richard H. Prokosch
                                                Vice President




                                                                       EXHIBIT 6

                                     CONSENT


     In accordance with Section 321(b) of the Trust Indenture Act of 1939, the
undersigned, U.S. BANK NATIONAL ASSOCIATION hereby consents that reports of
examination of the undersigned by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon its request therefor.



Dated:  April 1, 2004



                                            U.S. BANK NATIONAL ASSOCIATION


                                            By: /s/ Frank P. Leslie III
                                                --------------------------------
                                                Frank P. Leslie III
                                                Vice President



                                            By: /s/ Richard H. Prokosch
                                                --------------------------------
                                                Richard H. Prokosch
                                                Vice President





                                                                       EXHIBIT 7


                         U.S. BANK NATIONAL ASSOCIATION
                        STATEMENT OF FINANCIAL CONDITION
                                 AS OF 12/31/2003


                                    ($000'S)




                                                                 12/31/2003
                                                                ------------
                                                             

ASSETS
     Cash and Due From Depository Institutions                  $  8,631,361
     Federal Reserve Stock                                                 0
     Securities                                                   42,963,396
     Federal Funds                                                 2,585,353
     Loans & Lease Financing Receivables                         114,718,888
     Fixed Assets                                                  1,911,662
     Intangible Assets                                            10,254,736
     Other Assets                                                  8,093,654
                                                                ------------
         TOTAL ASSETS                                           $189,159,050

LIABILITIES
     Deposits                                                   $128,249,183
     Fed Funds                                                     5,098,404
     Treasury Demand Notes                                         3,585,132
     Trading Liabilities                                             213,447
     Other Borrowed Money                                         21,664,023
     Acceptances                                                     123,996
     Subordinated Notes and Debentures                             5,953,524
     Other Liabilities                                             5,173,011
                                                                ------------
     TOTAL LIABILITIES                                          $170,060,720

EQUITY
     Minority Interest in Subsidiaries                          $  1,002,595
     Common and Preferred Stock                                       18,200
     Surplus                                                      11,677,397
     Undivided Profits                                             6,400,138
                                                                ------------
         TOTAL EQUITY CAPITAL                                   $ 19,098,330

TOTAL LIABILITIES AND EQUITY CAPITAL                            $189,159,050




- --------------------------------------------------------------------------------

To the best of the undersigned's determination, as of the date hereof, the above
financial information is true and correct.



U.S. BANK NATIONAL ASSOCIATION


By: /s/ Frank P. Leslie III
    ----------------------------------
    Vice President



Date:  April 1, 2004

EX-99.1

                              LETTER OF TRANSMITTAL
                                IMAX CORPORATION

 OFFER TO EXCHANGE ANY AND ALL OUTSTANDING 9 5/8% SENIOR NOTES DUE 2010 ISSUED
 ON DECEMBER 4, 2003 FOR 9 5/8% SENIOR NOTES DUE 2010 WHICH HAVE BEEN REGISTERED
                        UNDER THE SECURITIES ACT OF 1933

     Pursuant to the Prospectus, dated           , 2004

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON      , 2004
   UNLESS EXTENDED (THE "EXPIRATION DATE"). TENDERS MAY BE WITHDRAWN PRIOR TO
  5:00 P.M.,  NEW YORK CITY TIME, ON THE EXPIRATION DATE. WHERE THE EXPIRATION
    DATE HAS BEEN EXTENDED, TENDERS PURSUANT TO THE EXCHANGE OFFER AS OF THE
PREVIOUSLY SCHEDULED EXPIRATION DATE MAY NOT BE WITHDRAWN AFTER THE DATE OF THE
                     PREVIOUSLY SCHEDULED EXPIRATION DATE.

                                  DELIVERY TO:

                 U.S. BANK NATIONAL ASSOCIATION, EXCHANGE AGENT

                       BY HAND, MAIL OR OVERNIGHT COURIER:
                              60 Livingstone Avenue
                         St. Paul, Minnesota 55107-2292
                         Attention: Specialized Finance

For Information Call:           BY FACSIMILE:               Confirm Receipt of
                      (for eligible institutions only)   Facsimile by Telephone:
  (651) 495-8097               (651) 495-8097                 (651) 495-8097
                         Attention: Mr. Frank Leslie

     Delivery of this letter of transmittal to an address other than as set
forth above, or transmission of this Letter of Transmittal via facsimile to a
number other than as set forth above, will not constitute a valid delivery.
Please read this entire Letter of Transmittal carefully before completing any
box below.

     The undersigned acknowledges that he, she or it has received this Letter of
Transmittal (the "Letter") and the Prospectus, dated                , 2004
(the "Prospectus"), of IMAX Corporation (the "Company") or, if resident in
Canada, the Canadian Offering Memorandum dated           , 2004 (the "Canadian
Offering Memorandum"), relating to its offer to exchange up to $160,000,000
aggregate principal amount of its 9 5/8% Senior Notes due 2010 (the "New
Notes"), which have been registered under the Securities Act of 1933, as amended
(the "Securities Act"), for a like principal amount of its issued and
outstanding 9 5/8% Senior Notes due 2010 (the "Old Notes") from the registered
holders thereof (the "Holders"). The Prospectus (or, for Canadian residents, the
Canadian Offering Memorandum) and this Letter of Transmittal together constitute
the Company's offer to exchange (the "Exchange Offer") its Old Notes for a like
principal amount of its New Notes from the Holders.


     For each Old Note accepted for exchange, the Holder of such Old Note will
receive a New Note having a principal amount equal to that of, and representing
the same indebtedness or that represented by, the surrendered Old Note. The New
Notes will accrue interest from the last interest payment date on which interest
was paid on the Old Notes or, if no interest has been paid on the Old Notes,
from the issue date of the Old Notes. Accordingly, registered Holders of New
Notes on the relevant record date for the first interest payment date following
the consummation of the Exchange Offer will receive interest accruing from the
last interest payment date on which interest was paid or, if no interest has
been paid, from the issue date of the Old Notes. Old Notes accepted for exchange
will cease to accrue interest from and after the date of consummation of the
Exchange Offer. Holders of Old Notes whose Old Notes are accepted for exchange
will not receive any payment in respect of accrued interest on such Old Notes
otherwise payable on any interest payment date the record date for which occurs
on or after consummation of the Exchange Offer. If any tendered Old Notes are
not accepted for any reason described in the terms and conditions of the
Exchange Offer (including the termination or withdrawal of the Exchange Offer),
such unaccepted or such nonexchanged Old Notes will be returned promptly without
expense to the tendering Holder thereof (if in certificated form) or credited to
an account maintained with the Book-Entry Transfer Facility (as described below)
after the expiration or termination of the Exchange Offer.



     This Letter of Transmittal is to be completed by a Holder of Old Notes
either if certificates are to be forwarded herewith or if a tender of
certificates for Old Notes, if available, is to be made by book-entry transfer
to the account maintained by the Exchange Agent at The Depository Trust Company
("DTC") (the "Book-Entry Transfer Facility") pursuant to the procedures set
forth in "The Exchange Offer--Book-Entry Transfer" section of the Prospectus.
Holders of Old Notes whose certificates are not immediately available, or who
are unable to deliver confirmation of the book-entry tender of their Old Notes
into the Exchange Agent's account at the Book-Entry Transfer Facility (a
"Book-Entry Confirmation") and all other documents required by this Letter of
Transmittal to the Exchange Agent on or prior to the Expiration Date, must
tender their Old Notes according to the guaranteed delivery procedures set forth
in "The Exchange Offer--Guaranteed Delivery Procedures" section of the
Prospectus. See Instruction 1. Delivery of documents to the Book-Entry Transfer
Facility does not constitute delivery to the Exchange Agent.

     List below the Old Notes to which this Letter of Transmittal relates. If
the space provided below is inadequate, the certificate numbers and principal
amount of Old Notes should be listed on a separate signed schedule affixed
hereto.



                                  DESCRIPTION OF OLD NOTES

- ------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED      CERTIFICATE      AGGREGATE PRINCIPAL AMOUNT*     PRINCIPAL
 HOLDER(S) (PLEASE FILL IN, IF BLANK)        NUMBER(S)                                      AMOUNT OF
                                                                                           OLD NOTE(S)
                                                                                            TENDERED**
                                                                                 
- ------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------
                                                                TOTAL
- ------------------------------------------------------------------------------------------------------


- ----------
*    Need not be completed if Old Notes are being tendered by book-entry
     transfer.
**   Unless otherwise indicated in this column, a holder will be deemed to have
     tendered ALL of the Old Notes represented by the Old Notes indicated in
     column 2. See Instruction 2. Old Notes tendered hereby must be in
     denominations of principal amount of $1,000 and any integral multiple
     thereof. See Instruction 1.

[ ]  CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
     MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY
     TRANSFER FACILITY AND COMPLETE THE FOLLOWING:

     Name of Tendering Institution _____________________________________________

     Account Number ____________________________________________________________

     Transaction Code Number ___________________________________________________

[ ]  CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE
     OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE
     THE FOLLOWING:

     Name(s) of Registered Holder(s) ___________________________________________

     Window Ticket Number (if any) _____________________________________________

     Date of Execution of Notice of Guaranteed Delivery ________________________

     Name of Institution That Guaranteed Delivery ______________________________

     IF DELIVERED BY BOOK-ENTRY TRANSFER, COMPLETE THE FOLLOWING:

     Account Number ____________________________________________________________

     Transaction Code Number ___________________________________________________

[  ] CHECK HERE IF YOU ARE A BROKER-DEALER OR OTHER PARTY ENTITLED, PURSUANT
     TO THE TERMS OF THE REGISTRATION RIGHTS AGREEMENT REFERRED TO IN THE
     PROSPECTUS, TO RECEIVE, AND WISH TO RECEIVE, 10 ADDITIONAL COPIES OF THE

                                       2



     PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO WITHIN
     180 DAYS AFTER THE EXPIRATION DATE.

     Name: _____________________________________________________________________

     Address: __________________________________________________________________

     If the undersigned is not a broker-dealer, the undersigned represents that
it is not engaged in, and does not intend to engage in, a distribution of New
Notes. If the undersigned is a broker-dealer that will receive New Notes for its
own account in exchange for Old Notes that were acquired as a result of
market-making activities or other trading activities, it acknowledges and
represents that it will deliver a prospectus meeting the requirements of the
Securities Act, in connection with any resale of such New Notes; however, by so
acknowledging and representing and by delivering such a prospectus the
undersigned will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. If the undersigned is a broker-dealer that will
receive New Notes, it represents that the Old Notes to be exchanged for the New
Notes were acquired as a result of market-making activities or other trading
activities. In addition, such broker-dealer represents that it is not acting on
behalf of any person who could not truthfully make the foregoing
representations.

                                       3



              PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

     Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the aggregate principal amount of Old
Notes indicated above. Subject to, and effective upon, the acceptance for
exchange of the Old Notes tendered hereby, the undersigned hereby sells, assigns
and transfers to, or upon the order of, the Company all right, title and
interest in and to such Old Notes as are being tendered hereby.

     The undersigned hereby irrevocably constitutes and appoints the Exchange
Agent as the undersigned's true and lawful agent and attorney-in-fact with
respect to such tendered Old Notes, with full power of substitution, among other
things, to cause the Old Notes to be assigned, transferred and exchanged.

     The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Old Notes, and
to acquire New Notes issuable upon the exchange of such tendered Old Notes, and
that, when such Old Notes are accepted for exchange, the Company will acquire
good and unencumbered title thereto, free and clear of all liens, restrictions,
charges and encumbrances and not subject to any adverse claim when the same are
accepted by the Company. The undersigned hereby further represents and warrants
that any New Notes acquired in exchange for Old Notes tendered hereby will have
been acquired in the ordinary course of business of the person receiving such
New Notes, whether or not such person is the undersigned, that neither the
Holder of such Old Notes nor any such other person is participating in, intends
to participate in or has an arrangement or understanding with any person to
participate in the distribution (within the meaning of the Securities Act) of
Old Notes or New Notes, that neither the Holder of such Old Notes nor any such
other person is an "affiliate," as defined in Rule 405 under the Securities Act,
of the Company, and that neither the Holder of such Old Notes nor such other
person is acting on behalf of any person who could not truthfully make the
foregoing representations and warranties.

     The undersigned, in the case only of residents of Canada, represents and
warrants that it:

     (a)  is resident in the Province of British Columbia, Alberta,
          Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick or Prince
          Edward Island and is entitled under the applicable provincial
          securities laws to acquire the New Notes without the benefit of a
          prospectus qualified under those securities laws and, in the case of
          provinces other than Ontario, without the services of a dealer
          registered pursuant to those securities laws;

     (b)  is basing its investment decision solely on the Canadian Offering
          Memorandum dated            , 2004 and not on any other information
          concerning the Company or the New Offer;

     (c)  has reviewed and acknowledges the terms referred to under the heading
          "Resale Restrictions" in the Canadian Offering Memorandum;

     (d)  if in Ontario, is an "accredited investor" as defined in Ontario
          Securities Commission Rule 45-501 ("Rule 45-501"), and is not an
          individual unless purchasing from a fully registered dealer within the
          meaning of Section 204 of the Regulation to the Securities Act
          (Ontario);

     (e)  if in Quebec, is: (i) a government, department or agency referred to
          in Section 43 of the Securities Act (Quebec); (ii) a "sophisticated
          purchaser" within the meaning of Section 44 of the Securities Act
          (Quebec); or (iii) a "sophisticated purchaser" within the meaning of
          Section 45 of the Securities Act (Quebec) purchasing for the portfolio
          of a person managed solely by it;

     (f)  if in British Columbia, Alberta, Saskatchewan, Manitoba or Prince
          Edward Island, is an "accredited investor" as defined in Multilateral
          Instrument 45-103 ("MI 45-103);

     (g)  if in New Brunswick, is purchasing New Notes as principal in an amount
          not less than Cdn. $97,000; and


                                       4




     (h)  is either purchasing New Notes as principal for its own account, or is
          deemed to be purchasing New Notes as principal for its own account in
          accordance with the applicable securities laws of the province in
          which such purchaser is resident, by virtue of being either: (i) a
          designated trust company; (ii) a designated insurance company; (iii) a
          portfolio manager; or (iv) another entity similarly deemed by those
          laws to be purchasing as principal for its own account when purchasing
          on behalf of other beneficial purchasers.

     By acquiring New Notes under the Exchange Offer, each Canadian resident
acknowledges that its name and other specified information, including the
principal amount of New Notes it has acquired, may be disclosed to Canadian
securities regulatory authorities and may become available to the public in
accordance with the requirements of applicable laws. The tendering holder
consents to the disclosure of that information. Each tendering holder of New
Notes in Canada hereby agrees that it is such tendering holder's express wish
that all documents evidencing or relating in any way to the offer and sale of
New Notes be drafted in the English language only. Chaque acheteur au Canada des
valeurs mobilieres reconnait que c'est sa volonte expresse que tous les
documents faisant foi ou se rapportant de quelque maniere a l'offert et vente
des valeurs mobilieres soient rediges uniquement en anglais.

     The undersigned acknowledges that this Exchange Offer is being made in
reliance on interpretations by the staff of the Securities and Exchange
Commission (the "SEC"), as set forth in no-action letters issued to third
parties, that the New Notes issued pursuant to the Exchange Offer in exchange
for the Old Notes may be offered for resale, resold and otherwise transferred by
Holders thereof (other than any such Holder that is a broker-dealer or an
"affiliate" of the Company within the meaning of Rule 405 under the Securities
Act), without compliance with the registration and prospectus delivery
provisions of the Securities Act, provided that such New Notes are acquired in
the ordinary course of such Holder's business, at the time of commencement of
the Exchange Offer such Holder has no arrangement or understanding with any
person to participate in a distribution of such New Notes, and such Holder is
not engaged in, and does not intend to engage in, a distribution of such New
Notes. However, the SEC has not considered the Exchange Offer in the context of
a no-action letter and there can be no assurance that the staff of the SEC would
make a similar determination with respect to the Exchange Offer as in other
circumstances. If the undersigned is not a broker-dealer, the undersigned
represents that it is not engaged in, and does not intend to engage in, a
distribution of New Notes and has no arrangement or understanding to participate
in a distribution of New Notes. If the undersigned is a broker-dealer that will
receive New Notes for its own account in exchange for Old Notes, it represents
that the Old Notes to be exchanged for the New Notes were acquired by it as a
result of market-making activities or other trading activities and acknowledges
that it will deliver a prospectus meeting the requirements of the Securities Act
in connection with any resale of such New Notes; however, by so acknowledging
and by delivering a prospectus meeting the requirements of the Securities Act,
the undersigned will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act.

     The SEC has taken the position that such broker-dealers may fulfill their
prospectus delivery requirements with respect to the New Notes (other than a
resale of New Notes received in exchange for an unsold allotment from the
original sale of the Old Notes) with the Prospectus. The Prospectus, as it may
be amended or supplemented from time to time, may be used by certain
broker-dealers (as specified in the Registration Rights Agreement referenced in
the Prospectus) ("Participating Broker-Dealers") for a period of time, starting
on the Expiration Date and ending on the close of business 90 days after the
Expiration Date in connection with the sale or transfer of such New Notes. The
Company has agreed that, for such period of time, it will make the Prospectus
(as it may be amended or supplemented) available to such a broker-dealer which
elects to exchange Old Notes, acquired for its own account as a result of market
making or other trading activities, for New Notes pursuant to the Exchange Offer
for use in connection with any resale of such New Notes. By accepting the
Exchange Offer, each broker-dealer that receives New Notes pursuant to the
Exchange Offer acknowledges and agrees to notify the Company prior to using the
Prospectus in connection with the sale or transfer of New Notes and that, upon
receipt of notice from the Company of the happening of any event which makes any
statement in the Prospectus untrue in any material respect or which requires the
making of any changes in the Prospectus in order to make the statements therein
(in light of the circumstances under which they were made) not misleading, such
broker-dealer will suspend use of the Prospectus until (i) the Company has
amended or supplemented the Prospectus to correct such misstatement or omission
and (ii) either the Company has furnished copies of the amended or supplemented
Prospectus to such broker-dealer or, if the Company has not otherwise agreed to
furnish such copies and declines to do so after such broker-dealer so requests,
such broker-dealer has obtained a copy of such amended or supplemented
Prospectus as filed with the SEC. Except

                                       5




as described above, the Prospectus may not be used for or in connection with an
offer to resell, a resale or any other retransfer of New Notes. A broker-dealer
that acquired Old Notes in a transaction other than as part of its market-making
activities or other trading activities will not be able to participate in the
Exchange Offer.

     The undersigned will, upon request, execute and deliver any additional
documents deemed by the Company to be necessary or desirable to complete the
sale, assignment and transfer of the Old Notes tendered hereby. All authority
conferred or agreed to be conferred in this Letter and every obligation of the
undersigned hereunder shall be binding upon the successors, assigns, heirs,
executors, administrators, trustees in bankruptcy and legal representatives of
the undersigned and shall not be affected by, and shall survive, the death or
incapacity of the undersigned. This tender may be withdrawn only in accordance
with the procedures set forth in "The Exchange Offer--Withdrawal of Tenders"
section of the Prospectus.

     Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" below, please deliver the New Notes (and, if applicable,
substitute certificates representing Old Notes for any Old Notes not exchanged)
in the name of the undersigned or, in the case of a book-entry delivery of Old
Notes, please credit the account indicated above maintained at the Book-Entry
Transfer Facility. Similarly, unless otherwise indicated under the box entitled
"Special Delivery Instructions" below, please send the New Notes (and, if
applicable, substitute certificates representing Old Notes for any Old Notes not
exchanged) to the undersigned at the address shown above in the box entitled
"Description of Old Notes."

THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OLD NOTES" ABOVE
AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED THE OLD NOTES AS SET
FORTH IN SUCH BOX ABOVE.

PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL CAREFULLY BEFORE COMPLETING ANY
BOX ABOVE.

                                       6


                                PLEASE SIGN HERE
                   (TO BE COMPLETED BY ALL TENDERING HOLDERS)

________________________________________________________________________________
SIGNATURE(S) OF OWNER                                                       DATE

Area Code and Telephone Number _________________________________________________

     If a Holder is tendering an Old Note, this Letter must be signed by the
registered Holder(s) as the name(s) appear(s) on the certificate(s) for the Old
Note or by any person(s) authorized to become registered Holder(s) by
endorsements and documents transmitted herewith. If, signature is by a trustee,
executor, administrator, guardian, officer or other person acting in a fiduciary
or representative capacity, please set forth full title. See Instruction 3.

Name(s) ________________________________________________________________________
                             (PLEASE TYPE OR PRINT)

Capacity: ______________________________________________________________________

Address: _______________________________________________________________________

SIGNATURE GUARANTEE (IF REQUIRED BY INSTRUCTION 3) SIGNATURE(S) GUARANTEED BY AN
ELIGIBLE INSTITUTION:

________________________________________________________________________________
                             (AUTHORIZED SIGNATURE)

________________________________________________________________________________
                                     (TITLE)

________________________________________________________________________________
                                 (NAME AND FIRM)

DATED:____________________________________________________________________, 2004


                                       7


                          SPECIAL ISSUANCE INSTRUCTIONS
                          (SEE INSTRUCTIONS 3, 4 AND 6)

To be completed ONLY if certificates for Old Notes not exchanged and/or New
Notes are to be issued in the name of and sent to someone other than the person
or persons whose signature(s) appear(s) on this Letter above, or if Old Notes
delivered by book-entry transfer which are not accepted for exchange are to be
returned by credit to an account maintained at the Book-Entry Transfer Facility
other than the account indicated above.

Issue: New Notes and/or Old Notes to: __________________________________________
                                                 (Please Type or Print)

Names(s) and Taxpayer Identification or Social Security Number(s):

________________________________________________________________________________
                                                  (Please Type or Print)

________________________________________________________________________________
                                                  (Please Type or Print)

Address: _______________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________
                                                      (Zip/Postal Code)


- --------------------------------------------------------------------------------


[ ]  Credit unexchanged Old Notes delivered by book-entry transfer to the
     Book-Entry Transfer Facility account set forth below:

________________________________________________________________________________
          (Book-Entry Transfer Facility Account Number, if Applicable)


                                       8




                          SPECIAL DELIVERY INSTRUCTIONS
                          (SEE INSTRUCTIONS 3, 4 AND 6)

To be completed ONLY if certificates for Old Notes not exchanged and/or New
Notes are to be sent to someone other than the person or persons whose
signature(s) appear(s) on this Letter above or to such person or persons at an
address other than shown in the box entitled "Description of Old Notes" on this
Letter above.

Mail: New Notes and/or Old Notes to: ___________________________________________
                                               (Please Type or Print)

Names(s): ______________________________________________________________________
                                               (Please Type or Print)

________________________________________________________________________________
                                               (Please Type or Print)

Address: _______________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________
                                                    (Zip/Postal Code)


IMPORTANT: UNLESS GUARANTEED DELIVERY PROCEDURES ARE COMPLIED WITH, THIS LETTER
OR A FACSIMILE HEREOF (TOGETHER WITH THE CERTIFICATES FOR OLD NOTES OR A
BOOK-ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS) MUST BE RECEIVED BY
THE EXCHANGE AGENT PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION
DATE.


                                       9



INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER TO EXCHANGE
ANY AND ALL OUTSTANDING 9 5/8% SENIOR NOTES DUE 2010 ISSUED ON DECEMBER 4, 2003
OF IMAX CORPORATION FOR 9 5/8% SENIOR NOTES DUE 2010 OF IMAX CORPORATION THAT
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED

1.   DELIVERY OF THIS LETTER AND NOTES; GUARANTEED DELIVERY PROCEDURES. This
     Letter is to be completed by Holders of Old Notes either if certificates
     are to be forwarded herewith or if tenders are to be made pursuant to the
     procedures for delivery by book-entry transfer set forth in "The Exchange
     Offer--Book-Entry Transfer" section of the Prospectus. Certificates for all
     physically tendered Old Notes, or Book-Entry Confirmation, as the case may
     be, as well as a properly completed and duly executed Letter (or manually
     signed facsimile hereof) and any other documents required by this Letter,
     must be received by the Exchange Agent at the address set forth herein on
     or prior to the Expiration Date, or the tendering Holder must comply with
     the guaranteed delivery procedures set forth below. Old Notes tendered
     hereby must be in denominations of principal amount of $1,000 and any
     integral multiple thereof.

     Holders whose certificates for Old Notes are not immediately available or
     who cannot deliver their certificates and all other required documents to
     the Exchange Agent on or prior to the Expiration Date, or who cannot
     complete the procedure for book-entry transfer on a timely basis, may
     tender their Old Notes pursuant to the guaranteed delivery procedures set
     forth in "The Exchange Offer--Guaranteed Delivery Procedures" section of
     the Prospectus. Pursuant to such procedures, (i) such tender must be made
     through an Eligible Institution (as defined herein), (ii) prior to 5:00
     P.M., New York City time, on the Expiration Date, the Exchange Agent must
     receive from such Eligible Institution a properly completed and duly
     executed Letter (or a facsimile thereof) and Notice of Guaranteed Delivery,
     substantially in the form provided by the Company (by facsimile
     transmission, mail or hand delivery), setting forth the name and address of
     the Holder of Old Notes and the amount of Old Notes tendered, stating that
     the tender is being made thereby and guaranteeing that within three New
     York Stock Exchange ("NYSE") trading days after the date of execution of
     the Notice of Guaranteed Delivery, the certificates for all physically
     tendered Old Notes, in proper form for transfer, or a Book-Entry
     Confirmation, as the case may be, and any other documents required by this
     Letter will be deposited by the Eligible Institution with the Exchange
     Agent, and (iii) the certificates for all physically tendered Old Notes, in
     proper form for transfer, or a Book-Entry Confirmation, as the case may be,
     and all other documents required by this Letter, are received by the
     Exchange Agent within three NYSE trading days after the date of execution
     of the Notice of Guaranteed Delivery.

     The method of delivery of this Letter, the Old Notes and all or any other
     required documents is at the election and risk of the tendering Holders,
     but the delivery will be deemed made only when actually received or
     confirmed by the Exchange Agent. If Old Notes, this Letter and all other
     required documents are sent by mail, it is suggested that the mailing be
     registered mail, properly insured, with return receipt requested, made
     sufficiently in advance of the Expiration Date to permit delivery to the
     Exchange Agent prior to 5:00 P.M., New York City time, on the Expiration
     Date. See the "The Exchange Offer" section of the Prospectus.


                                     10




2.   PARTIAL TENDERS (NOT APPLICABLE TO NOTEHOLDERS WHO TENDER BY BOOK-ENTRY
     TRANSFER). If less than all of the Old Notes evidenced by a submitted
     certificate are to be tendered, the tendering Holder(s) should fill in the
     aggregate principal amount of Old Notes to be tendered in the box above
     entitled "Description of Old Notes--Principal Amount Tendered." A reissued
     certificate representing the balance of nontendered Old Notes will be sent
     to such tendering Holder, unless otherwise provided in the appropriate box
     on this Letter, promptly after the Expiration Date.

     ALL OF THE OLD NOTES DELIVERED TO THE EXCHANGE AGENT WILL BE DEEMED TO HAVE
     BEEN TENDERED UNLESS OTHERWISE INDICATED.

3.   SIGNATURES ON THIS LETTER; BOND POWERS AND ENDORSEMENTS; GUARANTEE OF
     SIGNATURES. If this Letter is signed by the registered Holder of the Old
     Notes tendered hereby, the signature must correspond exactly with the name
     as written on the face of the certificates without any change whatsoever.

     If any tendered Old Notes are owned of record by two or more joint owners,
     all of such owners must sign this Letter.

     If any tendered Old Notes are registered in different names on several
     certificates, it will be necessary to complete, sign and submit as many
     separate copies of this Letter as there are different registrations of
     certificates.

     When this Letter is signed by the registered Holder or Holders of the Old
     Notes specified herein and tendered hereby, no endorsements of certificates
     or separate bond powers are required. If, however, the New Notes are to be
     issued, or any untendered Old Notes are to be reissued, to a person other
     than the registered Holder, then endorsements of any certificates
     transmitted hereby or separate bond powers are required. Signatures on such
     certificate(s) must be guaranteed by an Eligible Institution.

     If this Letter is signed by a person other than the registered Holder or
     Holders of any certificate(s) specified herein, such certificate(s) must be
     accompanied by appropriate bond powers, in either case signed exactly as
     the name or names of the registered Holder or Holders appear(s) on the
     certificate(s) and signatures on such certificate(s) must be guaranteed by
     an Eligible Institution.

     If this Letter or any certificates or bond powers are signed by trustees,
     executors, administrators, guardians, attorneys-in-fact, officers of
     corporations or others acting in a fiduciary or representative capacity,
     such persons should so indicate when signing, and, unless waived by the
     Company, proper evidence satisfactory to the Company of their authority to
     so act must be submitted.

ENDORSEMENTS ON CERTIFICATES FOR OLD NOTES OR SIGNATURES ON BOND POWERS REQUIRED
BY THIS INSTRUCTION 3 MUST BE GUARANTEED BY ANY MEMBER FIRM OF A REGISTERED
NATIONAL SECURITIES EXCHANGE OR OF THE NATIONAL ASSOCIATION OF SECURITIES
DEALERS, INC., A COMMERCIAL BANK OR TRUST COMPANY HAVING AN OFFICE OR
CORRESPONDENT IN THE UNITED STATES OR AN "ELIGIBLE GUARANTOR INSTITUTION" WITHIN
THE MEANING OF RULE 17AD-15 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED (EACH AN "ELIGIBLE INSTITUTION").

SIGNATURES ON THIS LETTER NEED NOT BE GUARANTEED BY AN ELIGIBLE INSTITUTION,
PROVIDED THE OLD NOTES ARE TENDERED: (I) BY A REGISTERED HOLDER OF OLD NOTES
(WHICH TERM, FOR PURPOSES OF THE EXCHANGE OFFER, INCLUDES ANY PARTICIPANT IN THE
BOOK-ENTRY TRANSFER FACILITY SYSTEM WHOSE NAME APPEARS ON A SECURITY POSITION
LISTING AS THE HOLDER OF SUCH OLD NOTES) WHO HAS NOT COMPLETED THE BOX ENTITLED
"SPECIAL ISSUANCE INSTRUCTIONS" OR "SPECIAL DELIVERY INSTRUCTIONS" IN THIS
LETTER, OR (II) FOR THE ACCOUNT OF AN ELIGIBLE INSTITUTION.

4.   SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. Tendering Holders of Old Notes
     should indicate in the applicable box the name and address to which New
     Notes issued pursuant to the Exchange Offer and/or


                                     11




     substitute certificates evidencing Old Notes not exchanged are to be issued
     or sent, if different from the name or address of the person signing this
     Letter. In the case of issuance in a different name, the employer
     identification or social security number of the person named must also be
     indicated. Holders tendering Old Notes by book-entry transfer may request
     that Old Notes not exchanged be credited to such account maintained at the
     Book-Entry Transfer Facility as such Holder may designate herein. If no
     such instructions are given, such Old Notes not exchanged will be returned
     to the name and address of the person signing this Letter.

5.   TRANSFER TAXES. The Company will pay all transfer taxes, if any, applicable
     to the transfer of Old Notes to it or its order pursuant to the Exchange
     Offer. If, however, New Notes and/or substitute Old Notes not exchanged are
     to be delivered to, or are to be registered or issued in the name of, any
     person other than the registered Holder of the Old Notes tendered hereby,
     or if tendered Old Notes are registered in the name of any person other
     than the person signing this Letter, or if a transfer tax is imposed for
     any reason other than the transfer of Old Notes to the Company or its order
     pursuant to the Exchange Offer, the amount of any such transfer taxes
     (whether imposed on the registered Holder or any other persons) will be
     payable by the tendering Holder. If satisfactory evidence of payment of
     such taxes or exemption therefrom is not submitted herewith, the amount of
     such transfer taxes will be billed directly to such tendering Holder.

     Except as provided in this instruction 6, it will not be necessary for
     transfer tax stamps to be affixed to the old notes specified in this
     letter.

6.   WAIVER OF CONDITIONS. The Company reserves the absolute right to waive
     satisfaction of any or all conditions enumerated in the Prospectus.

7.   NO CONDITIONAL TENDERS. No alternative, conditional, irregular or
     contingent tenders will be accepted. All tendering Holders of Old Notes, by
     execution of this Letter, shall waive any right to receive notice of the
     acceptance of their Old Notes for exchange.

     Neither the Company, the Exchange Agent nor any other person is obligated
     to give notice of any defect or irregularity with respect to any tender of
     Old Notes nor shall any of them incur any liability for failure to give any
     such notice.

8.   MUTILATED, LOST, STOLEN OR DESTROYED OLD NOTES. Any Holder whose Old Notes
     have been mutilated, lost, stolen or destroyed should contact the Exchange
     Agent at the address indicated above for further instructions.

9.   WITHDRAWAL RIGHTS. Tenders of Old Notes of a series may be withdrawn at any
     time prior to 5:00 P.M., New York City time, on the Expiration Date.

     For a withdrawal of a tender of Old Notes to be effective, a written notice
     of withdrawal must be received by the Exchange Agent at the address set
     forth above prior to 5:00 P.M., New York City time, on the Expiration Date
     with respect to such series. Any such notice of withdrawal must (i) specify
     the name of the person having tendered the Old Notes to be withdrawn (the
     "Depositor"), (ii) identify the Old Notes to be withdrawn (including the
     principal amount of such Old Notes), (iii) in the case of Old Notes
     tendered by book-entry transfer, specify the number of the account at the
     Book-Entry Transfer Facility from which the Old Notes were tendered and
     specify the name and number of the account at the Book-Entry Transfer
     Facility to be credited with the withdrawn Old Notes and otherwise comply
     with the procedures of such facility, (iv) contain a statement that such
     Holder is withdrawing its election to have such Old Notes exchanged, (v) be
     signed by the Holder in the same manner as the original signature on the
     Letter by which such Old Notes were tendered (including any required
     signature guarantees) or be accompanied by documents of transfer to have
     the Trustee with respect to the Old Notes register the transfer of such Old
     Notes in the name of the person withdrawing the tender and (vi) specify the
     name in which such Old Notes are registered, if different from that of the
     Depositor. All questions as to the validity, form and eligibility
     (including time of receipt) of such notices will be determined by the
     Company, whose determination shall be final and binding on all parties. Any
     Old Notes so withdrawn will be deemed not to have been validly tendered


                                     12




     for exchange for purposes of the Exchange Offer and no New Notes will be
     issued with respect thereto unless the Old Notes so withdrawn are validly
     retendered. Any Old Notes that have been tendered for exchange but which
     are not exchanged for any reason will be returned to the tendering Holder
     thereof without cost to such Holder (or, in the case of Old Notes tendered
     by book-entry transfer into the Exchange Agent's account at the Book-Entry
     Transfer Facility pursuant to the book-entry transfer procedures set forth
     in "The Exchange Offer--Book-Entry Transfer" section of the Prospectus,
     such Old Notes will be credited to an account maintained with the
     Book-Entry Transfer Facility for the Old Notes) as soon as practicable
     after withdrawal, rejection of tender or termination of the Exchange Offer.
     Properly withdrawn Old Notes may be retendered by following the procedures
     described above at any time on or prior to 5:00 P.M., New York City time,
     on the Expiration Date with respect to such series of Old Notes.

10.  REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions relating to the
     procedure for tendering, as well as requests for additional copies of the
     Prospectus and this Letter, and requests for Notices of Guaranteed Delivery
     and other related documents may be directed to the Exchange Agent, at the
     address and telephone number indicated above.


                                       13