EXHIBIT 10.1
INTERIM OPERATING AGREEMENT
THIS INTERIM OPERATING AGREEMENT (the "Agreement"), dated as of
December 6, 2001, is entered into by and between AMC ENTERTAINMENT INC., a
Delaware corporation ("AMCE"), and GC COMPANIES, INC., a Delaware corporation
("GCX").
Recitals
WHEREAS, GCX and certain of its subsidiaries (collectively, the "GC
Debtors") are the debtors and debtors-in-possession in proceedings pending in
the United States Bankruptcy Court for the District of Delaware (the
"Bankruptcy Court") as case numbers 00-3897 through 00-3927 (as
administratively consolidated, the "GC Chapter 11 Cases"); and
WHEREAS, GCX is a holding company engaged in three primary lines of
business (collectively, the "GC Business") through its subsidiaries and
Affiliates: (i) a wholly-owned domestic movie theatre exhibition business (the
"Domestic Theatre Business") conducted through General Cinema Theatres, Inc.
and its subsidiaries, (ii) a South American movie theatre exhibition business
(the "SA Theatre Business") conducted through Hoyts General Cinema South
America, Inc. and its Affiliates (the "SA Joint Venture"), and (iii) a private
investment business (the "Investment Portfolio") conducted through GCC
Investments, Inc. and its Affiliates; and
WHEREAS, AMCE has entered into a letter of intent dated this date
(the "LOI") with GCX whereby AMCE would acquire the GC Business (the
"Transaction") through the acquisition of 100% of the stock of reorganized GCX
under a plan of reorganization for the GC Debtors in the GC Chapter 11 Cases
(the "Reorganization Plan"), following the confirmation and the effective date
of the Reorganization Plan; and
WHEREAS, AMCE is requiring as a condition precedent to executing
the LOI and proceeding with the Transaction, that GCX enter into this
Agreement;
Agreements
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained in this Agreement and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement agree as follows:
1. Definitions. For purposes of this Agreement (including the
Schedules hereto), the terms defined in this Agreement shall have the
respective meanings specified herein, and, in addition, the following terms
shall have the following meanings:
"Affiliate" or "affiliate" means, as to any Person, any other
Person that directly or indirectly, owns or controls, is owned or
controlled by, or is under common ownership or control with, such Person.
The term "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as applied to any
Person, means the possession, direct or indirect, of the power to direct
or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities or other ownership
interest, by contract or otherwise.
"Agreement" is defined in the Preamble.
"AMCE" is defined in the Preamble.
"Bankruptcy Court" is defined in the Recitals.
"Benefit Plan" has the meaning given in ERISA Section 3(3).
"Benefit Plan Sponsor" has the meaning given in ERISA Section
3(16)(B).
"Business Day" means any day other than a Saturday, a Sunday, a day
on which banks in the City of New York are authorized or required to
close, or the day after Thanksgiving Day.
"Cash Flow Projection" means the Closing Budget (as defined in the
DIP Facility) dated November 5, 2001, a copy of which has been previously
provided to AMCE, as modified in accordance with Section 7.01(f) of the
DIP Facility or as updated in the Ordinary Course of Business.
"Commercially Reasonable Efforts" means the use of efforts that a
commercially reasonable Person desirous of achieving a result would use
in similar circumstances.
"Company Other Benefit Obligation" means an Other Benefit
Obligation owed, adopted, or followed by GCX or an ERISA Affiliate of an
Acquired Company.
"Company Plan" means all Plans of which GCX or an ERISA Affiliate
of GCX is or was a Plan Sponsor, or to which GCX or an ERISA Affiliate of
GCX otherwise participates or has participated. All references to Plans
are to Company Plans unless the context requires otherwise.
"Company VEBA" means a VEBA whose members include employees of GCX
or any ERISA Affiliate of GCX.
"Designated AMCE Representative" means Xxxxx X. Xxxxxx, Chief
Financial Officer of AMCE, or any other officer of AMCE designated by
AMCE in writing to GCX.
"DIP Facility" means that certain Debtor in Possession Agreement
dated October 11, 2000, by and between GCX, General Electric Capital
Corporation, Fleet National Bank, and the Bank of Nova Scotia, as
amended.
"Domestic Theatre Business" is defined in the Recitals.
"Effective Date" means the date this Agreement was executed by
authorized representatives of AMCE and GCX, subject to the Bankruptcy
Court entering an order approving this Agreement.
"ERISA Affiliate" means, with respect to GCX, any other Person
that, together with GCX, would treated as a single employer under IRC
Section 414.
"Fandango Arrangement" means that certain Exclusive Ticketing
Distribution Agreement between GCX and Fandango, Inc., dated March 3,
2000, as amended, and all other agreements related thereto.
"GC Chapter 11 Cases" is defined in the Recitals.
"GC Business" is defined in the Recitals.
"GCX" is defined in the Recitals.
"Governmental Authority" means any nation or government, any state
or other political subdivision thereof or any entity (including, without
limitation, a court) exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.
"Investment Portfolio" is defined in the Recitals.
"IRS" means the United States Internal Revenue Service.
"Legal Requirement" means any federal, state, local, municipal,
foreign, international, multinational, or other administrative order,
constitution, law, ordinance, principle of common law, regulation,
statute, or treaty.
"LOI" is defined in the Recitals.
"Material Adverse Effect" means that the action or event, taken
alone or in the aggregate, has a material adverse effect on the GC
Business, the assets used in the GC Business, the Transaction or the
Reorganization Plan.
"Multi-Employer Plan" has the meaning given in ERISA Section
3(37)(A).
"Operating Hours" shall mean the hours each theatre complex within
the Domestic Theatre Business and SA Theatre Business are open for
purposes of presenting movie presentations to the public, including the
preparation and closing thereof, during each day of each calendar week.
"Ordinary Course of Business" means a reasonable action taken by a
Person only if (taking into account the seasonality of the GC Business
and the GC Chapter 11 Cases) (a) such action is consistent with the past
practices of such Person and is taken in the ordinary course of the
normal day-to-day operations of such Person; and (b) such action is not
required to be authorized by the board of directors of such Person (or by
any Person or group of Persons exercising similar authority) and such
Person is not otherwise required to obtain the approval of AMCE or any
other person as may be required by this Agreement; except to the extent
such action is provided for or contemplated by the Reorganization Plan or
the LOI.
"Organizational Documents" means (a) the articles or certificates
of incorporation and the bylaws of a corporation; (b) the partnership
agreement and any statement of partnership of a general partnership; (c)
the limited partnership agreement and the certificate of limited
partnership of a limited partnership; (d) any charter or similar document
adopted or filed in connection with the creation, formation, or
organization of a Person; (e) the certificate of formation and limited
liability company agreement of a limited liability company; and (f) any
amendment to any of the foregoing.
"Other Benefit Obligations" means all obligations, arrangement, or
customary practices, whether or not legally enforceable, to provide
benefits, other than salary, as compensation for services rendered, to
present or former directors, employees, or agents, other than
obligations, arrangements, and practices that are Pension Plans. Other
Benefit Obligations include consulting agreement under which the
compensation does not depend upon the amount of service rendered,
sabbatical policies, severance payment policies, and fringe benefits
within the meaning of IRC Section 132.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
successor thereto.
"Pension Plan" has the meaning given in ERISA Section 3(2)(A).
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or
other entity or enterprise of whatever nature.
"Proceeding" means any action, arbitration, audit, hearing,
investigation, litigation, or suit (whether civil, criminal,
administrative, investigative, or informal) commenced, brought,
conducted, or heard by or before, or otherwise involving, any Government
Authority or arbitrator.
"Qualified Plan" means any Plan that meets or purports to meet the
requirements of IRC Section 401(a).
"Reorganization Plan" is defined in the Recitals.
"SA Theatre Business" is defined in the Recitals.
"SA Joint Venture" is defined in the Recitals.
"Term" is defined in Section 3.
"Title IV Plans" means all Pension Plans that are subject to Title
IV of ERISA, 29 U.S.C. Section 1301 et seq., other than Multi-Employer
Plans.
"Transaction" is defined in the Recitals.
"VEBA" means voluntary employees' beneficiary association under IRC
Section 501(c)(9).
"Welfare Plan" has the meaning given in ERISA Section 3(1).
2. Management Obligations and Covenants of GCX. Subject to the
terms and conditions of this Agreement (and taking into account the seasonality
of the GC Business and the GC Chapter 11 Cases) and except as contemplated by
the Reorganization Plan, GCX will manage the GC Business during the Term of
this Agreement, and will do so, unless as otherwise provided herein, in all
material respects only in the Ordinary Course of Business and in accordance
with all Legal Requirements. Except as contemplated by the Reorganization
Plan, GCX and its Affiliates will use Commercially Reasonable Efforts to
preserve intact the GC Business and keeping available the services of the
current officers, employees, and agents, and maintaining the relations and
goodwill with suppliers, customers, landlords, creditors, employees, agents and
others having business relationships with GCX and its Affiliates. Without
limiting the generality of the foregoing, GCX will manage the GC Business in
accordance with the lettered paragraphs of this Section 2:
(a) Implementing Transaction. GCX and its Affiliates will use
their Commercially Reasonable Efforts to implement the Transaction in
accordance with the LOI and the Reorganization Plan.
(b) Contracts and Undertakings. Except as contemplated by the
Reorganization Plan, GCX and its Affiliates will not enter into, extend,
renew, reject, terminate, assume, or materially modify or amend any
material contract without the prior written approval of the Designated
AMCE Representative, including:
(i) any contract or series of related contracts that
involves receipts, expenditures, performance of services or
delivery of goods or material by GCX or its Affiliates of an amount
or value in excess of $20,000, except for film licensing contracts
and orders for trade goods, services and supplies that are under
substantially the same terms as past practice and in accordance
with the Ordinary Course of Business;
(ii) any contract or series of related contracts involving
expenditures in excess of $10,000 that obligates GCX or its
Affiliates in any capacity whatsoever for performance for a term
longer than six months from the Effective Date of this Agreement
that cannot be terminated upon GCX or its Affiliates giving more
than thirty (30) days notice without penalty.
(iii) any lease, rental or occupancy agreement,
license, installment or conditional sale agreement affecting the
ownership of, leasing of, title of, use of, or any leasehold or
other interest in, any real property having a value of more than
$10,000, including any theatre lease;
(iv) any material licensing agreement or other contract with
respect to patents, trademarks, copyrights or other intellectual
property of GCX and its Affiliates, including any of the foregoing
agreements with current or former employees, consultants or
contractors regarding the appropriation or non-disclosure of any
intellectual property of GCX and its Affiliates;
(v) any collective bargaining agreement or other contract
with any labor union or other employee representative of a group of
employees; provided, that GCX may on notice to AMCE provide notices
of intent to negotiate and other notices required by law; provided
further, that GCX will provide a list of pending and anticipated
negotiations during the next six (6) months within five (5) days of
the Effective Date;
(vi) any contract that creates a joint venture, partnership
or other relationship involving a sharing of profits, losses, costs
or liabilities by GCX or any of its Affiliates with any other
Person;
(vii) any contract that purports to restrict the business
activity of GCX or any of its Affiliates or limit the freedom of
GCX or its Affiliates to engage in any line of business or to
compete with any Person;
(viii) any contract providing for payments to or by any Person
based on sales, purchases, or profits, other than direct payment
for goods, services or film supply in the Ordinary Course of
Business;
(ix) any power of attorney, other than those relating to
Governmental Authorities in the Ordinary Course of Business;
(x) any material contract that contains or provides for an
express undertaking by GCX or its Affiliates to be responsible for
consequential damages;
(xi) any material contracts with third party administrators,
actuaries, investment managers, consultants and other independent
contractors that relate to any Company Plan, Company Other Benefit
Obligation, or Company VEBA, except as required by a Legal
Requirement;
(xii) any contract for capital expenditures in excess of
$25,000; provided, that GCX may make emergency life safety capital
expenditures up to $100,000 or make capital expenditures to satisfy
Legal Requirements without AMCE's approval; and
(xiii) any written warranty, guaranty, and or other
similar undertaking with respect to contractual performance
extended by GCX or any of its Affiliates (except for contracts
permitted by the foregoing subsections).
(c) No Default. Other than any breach arising as a result of the
filing of the GC Chapter 11 Cases, GCX is not in and will not during the
Term breach any existing contract that is described in paragraph (b),
except where such breach does not have a Material Adverse Effect. GCX
will provide notice to the Designated AMCE Representative of any written
claim of such breach or default by any Person or Government Authority.
(d) Chapter 11 Cases. GCX and its Affiliates will not assume,
assign or reject any contracts, including theatre leases and guaranties,
in the GC Chapter 11 Cases without the previous written approval of the
Designated AMCE Representative. GCX will immediately provide AMCE copies
of any material, non-privileged correspondence relating to claims made in
the GC Chapter 11 Cases between GCX and any of its Affiliates and
creditors of GCX or any of its Affiliates, or any other material, non-
privileged documents or correspondence related to the GC Chapter 11
Cases. Any and all motions prepared by GCX and its Affiliates relating
to the GC Chapter 11 Cases must be submitted to the Designated AMCE
Representative prior to being filed with the Bankruptcy Court.
(e) Debtor in Possession Facility. GCX and its Affiliates will
not (i) amend or modify the DIP Facility or (ii) make any borrowings or
payments under the DIP Facility or otherwise, other than borrowings and
payments in the Ordinary Course of Business consistent with the Cash Flow
Projection. GCX will provide notice to the Designated AMCE
Representative of all DIP Facility borrowings and payments.
(f) Investments. GCX and its Affiliates will not make any
additional investments, payment, or other transfer of property in any
form, regardless of monetary amount or value, in or to the Investment
Portfolio, the SA Joint Venture, or the Fandango Arrangement without the
previous written approval of the Designated AMCE Representative. In
addition, no advisory committee of the Investment Portfolio will take any
action except for actions required by a Legal Requirement related to the
Investment Portfolio without the prior written approval of the Designated
AMCE Representative; provided however that the foregoing does not prevent
persons serving as directors of the portfolio companies to take any
actions in good faith in exercising their fiduciary duties.
(g) Corporate Matters. At all times during the Term of this
Agreement, GCX will provide copies of all minutes of meetings of the GCX
Board of Directors and its various committees to the Designated AMCE
Representative, redacted for privilege and for any discussion of AMCE.
Furthermore, any and all proposed changes to the Organizational Documents
of GCX or its Affiliates will require the written approval of an
authorized representative of AMCE. GCX and its Affiliates will not issue
any equity or debt securities without the prior written approval of an
authorized AMCE representative.
(h) Legal Proceedings. GCX will not, without the previous
written approval of the Designated AMCE Representative, cause GCX or any
of its Affiliates to confess a judgment or settle a dispute with any
Person or Government Authority which requires the payment by GCX or any
Affiliate or the allowance of a claim against GCX or any Affiliate in
excess of $10,000, except for settlement of non-priority unsecured
prepetition bankruptcy claims in the GC Chapter 11 Cases or as provided
in Section 2(p) hereof. GCX will immediately provide AMCE notice of any
Proceeding (i) that has been commenced by or against GCX or any of its
Affiliates or that otherwise relates to or may affect the business of, or
any of the assets owned or used by GCX or any of its Affiliates; or (ii)
that challenges, or that may have the effect of preventing, delaying,
making illegal, or otherwise interfering with the Transaction.
(i) Labor Relations. GCX will immediately provide AMCE notice of
(i) any threatened or existing strike, slowdown, picketing, work
stoppage, or employee grievance process, (ii) any Proceeding against or
affecting GCX or any of its Affiliates relating to the alleged violation
of any Legal Requirement pertaining to labor relations or employment
matters, including any charge or complaint filed by an employee or union
with the National Relations Board, the Equal Employment Opportunity
Commission, or any comparable Government Authority, organizational
activity, or other labor or employment dispute against or affecting GCX
or its Affiliates or their premises, or (iii) any applications of a
collective bargaining agent.
(j) Title to Properties. GCX will not, without previous written
approval of the Designated AMCE Representative, cause GCX or any of its
Affiliates to encumber or pledge any of the assets of GCX or any of its
Affiliates or, in the case or real property, otherwise cause such
property to become subject to any rights of way, building use
restrictions, exceptions, variances, reservations, or limitations of any
nature, except as provided in the DIP Facility.
(k) Domestic Theatre Business Operations. GCX and its Affiliates
will not, without the prior written approval of a Designated AMCE
Representative, materially diminish the Operating Hours of the Domestic
Theatre Business on a system-wide basis. On four (4) calendar days
notice, GCX and its Affiliates will provide AMCE personnel reasonable
access to management personnel of the Domestic Theatre Business during
normal business hours for the purposes of conducting interviews with the
same, investigating and auditing operations of the Domestic Theatre
Businesses. GCX and its Affiliates will provide AMCE quarterly reports
describing staffing levels of the Domestic Theatre Business, and will
keep AMCE advised of any changes in numbers or positions of the same.
(l) SA Theatre Business. GCX will provide AMCE with copies of
all written reports, financial statements or notices it receives in its
capacity as a shareholder of the SA Joint Venture or that its
representative on the Board of the SA Joint Venture receives, including
any weekly, monthly, quarterly or annual financial statements relating to
the SA Theatre Business. In addition, GCX shall not vote on any matter
as a shareholder of the SA Joint Venture without the previous written
approval of the Designated AMCE Representative. During the Term of this
Agreement, GCX will grant AMCE representatives the right and access to
tour the operations of the SA Theatre Business and meet with management
thereof upon five (5) days' prior notice. AMCE acknowledges that the SA
Theatre Business is not a debtor in the GC Chapter 11 Cases and that it
is not controlled by GCX; accordingly, nothing in this Agreement will be
deemed to (i) limit or restrict the exercise of the fiduciary obligations
of GCX's appointed Board representatives on the SA Joint Venture or (ii)
constitute a transfer of GCX's interest in the SA Joint Venture.
(m) Film Licensing. GCX and its Affiliates will retain full
control and authority with respect to film licensing and in no event will
AMCE be entitled to determine film booking for individual theatres of GCX
and its Affiliates. GCX and its Affiliates will not implement any
changes to film licensing terms with studios not otherwise in the
Ordinary Course of Business, including initiation by GCX and its
Affiliates of changes in position from "settlement" licensing agreements
with the studios to "firm-term" licensing agreements or arrangements,
without providing prior written notice to the Designated AMCE
Representative. In addition, GCX and its Affiliates will provide AMCE
with prior notice of any change to any clearance policies with studios or
implementation of a policy which is likely to result in a Significant
Reduction in the number of runs offered to studios or by studios to. For
purposes of this subparagraph, "Significant Reduction" means a reduction
in runs equal to 50% or greater from the standard coverage of runs for
any particular movie based on normal industry wide projections of that
particular movie, and under no circumstances, a reduction of greater than
25 runs for any particular movie release regardless of percentage
decrease. In addition to all other obligations under this subparagraph,
GCX and its Affiliates will provide the Designated AMCE Representative
notice of any change or event not in the Ordinary Course of Business that
could adversely effect film exhibition costs.
(n) Financial Statements. To the extent available to GCX, GCX
shall provide AMCE copies of all financial statements and reports
prepared by GCX pursuant to Article VII of the DIP Facility. GCX will
further provide AMCE with monthly P&L statements by theatre with
comparisons to budget and periodic payroll and concession analyses to be
agreed upon by GCX and the Designated AMCE Representative.
(o) Bank and Credit Accounts. GCX and its Affiliates will not
(i) open or close any bank accounts, (ii) change authorized signatures on
any existing bank account, except for replacements of former officers in
the Ordinary Course of Business, (iii) implement any new cash management
services, or (iv) enter into or change any credit card processing
agreements, without the prior written approval of a designated
representative of AMCE. GCX and its Affiliates further agree to provide
AMCE copies of all monthly bank reconciliation reports and all
correspondence with cash management banks.
(p) Insurance. GCX and its Affiliates will not (i) settle any
insurance claim in excess of $10,000 (except as provided for in the
Debtors' Motion for Authority to Implement Claims Resolution Procedures
[Insurance Related Claims] approved by the Bankruptcy Court on November
13, 2001), or (ii) make any changes in coverage for general liability,
workers compensation, automobile liability, umbrella and excess general
liability, crime and fiduciary, property, directors and officer or excess
director and officer insurance without the written approval of the
Designated AMCE Representative. GCX and its Affiliates will provide AMCE
copies of (i) all policy summaries confirming renewal of all current
insurance policies and (ii) copies of any internal or external weekly,
monthly, quarterly or annual insurance reserve analysis or loss reports.
(q) Employee Benefits and Related Matters.
(i) GCX will not make any changes to any Company Plan or
Company Other Benefit Obligation without the written approval of
the Designated AMCE Representative.
(ii) GCX will not make any grant, enter into or modify any
(A) employment contracts with GCX management personnel, (B)
employee incentive payout programs, (C) employee compensation
raises (other than annual raises in the Ordinary Course of Business
not exceeding 2%, or as required by a Legal Requirement, collective
bargaining agreement or existing employment agreement), or (D)
severance and retention plans or packages, without the prior
written approval of the Designated AMCE Representative.
(iii) GCX will not relocate management personnel without the
prior written approval of the Designated AMCE Representative if
such relocation is not in the Ordinary Course of Business and the
costs of such relocation exceeds $5,000 per employee.
(iv) GCX will provide AMCE copies of all registration
statements filed with respect to any Company Plan.
(v) GCX will provide AMCE copies of all reports submitted
by third party administrators, actuaries, investment managers,
consultants, or other independent contractors with respect to any
Company Plan, Company Other Benefit Obligations, or Company VEBA.
(vi) GCX will provide AMCE a copy of any Form 5500 filed
with respect to each Company Plan during the Term of this
Agreement, including all schedules and the opinions of independent
accountants.
(vii) GCX will provide AMCE a copy of all notices that were
given by the IRS, the PBGC, or the Department of Labor to GCX or
any of its ERISA Affiliates during the Term of this Agreement.
(viii) GCX will provide AMCE a copy of any Form PBGC-1
filed in connection with any Title IV Plans during the Term of this
Agreement.
(ix) GCX will provide AMCE a copy of all notifications
provided to employees of their rights under ERISA Section 601 et
sq. and IRC Section 4980B during the Term of this Agreement.
(r) Employee Retention. From time to time during this Agreement,
AMCE may require GCX or its Affiliates to offer and pay certain retention
incentives to employees selected by AMCE. AMCE will fund any amounts
paid to and accepted by the selected employees and any related amounts
that GCX may owe under applicable Legal Requirements, such as
withholding. Any retention incentive referenced in this paragraph is
separate from GCX's existing severance, enhanced severance and retention
programs and contractual obligations, all of which are at the sole cost
and expense of GCX and its Affiliates and are the sole obligations of GCX
and its Affiliates.
(s) Capital Expenditures. GCX will make necessary capital
expenditures in the Ordinary Course of Business but not in excess of the
amounts provided for in the Cash Flow Projection; provided, that GCX and
its Affiliates will not make any material changes to concession stands,
equipment or point of sale systems without the prior written approval of
the Designated AMCE Representative (other than normal replacements and
repairs in the Ordinary Course of Business).
3. Term and Termination.
(a) The term of this Agreement (the "Term") will commence on the
Effective Date and end on the effective date of the Reorganization Plan,
subject to earlier termination pursuant to paragraph (b).
(b) This Agreement may be terminated (i) by the mutual consent of
both parties, (ii) by AMCE, if GCX breaches this Agreement, the LOI, the
Reorganization Plan or any other document, instrument or Bankruptcy Court
order executed and or entered, as applicable, in connection with the
Transaction and fails to cure such breach within thirty (30) days after
AMCE gives GCX written notice of such breach, (iii) by GCX, if AMCE
breaches this Agreement, the LOI, the Reorganization Plan or any other
document, instrument or Bankruptcy Court order executed and or entered,
as applicable, in connection with the Transaction and fails to cure such
breach within thirty (30) days after GCX gives AMCE written notice of
such breach, (iv) by either party upon the termination of the LOI or the
definitive agreement for the Transaction. The sole and exclusive remedy
for monetary damages due to termination or breach of this Agreement shall
be as provided for in the LOI, but nothing in this sentence shall limit
the availability of equitable remedies, including specific performance
under Section 15, for breach of this Agreement.
4. Designated AMC Representative Approval. Pursuant to any
provision within this Agreement requiring the prior written approval of a
Designated AMCE Representative, such Designated AMCE Representative will
provide GCX with written notice of its approval or rejection, or request for
additional information, within four (4) Business Days of receipt of such
request made by GCX or its Affiliates. If AMCE does not provide GCX with a
written response of any kind within four (4) Business Days, AMCE will be deemed
to have approved such action. Any consent or approval of AMCE required under
this Agreement may be given or withheld in AMCE's sole discretion.
5. Relationships Among the Parties. Nothing in this Agreement
will cause the relationship between GCX (its Affiliates or third party
providers) on the one hand and AMCE and its Affiliates on the other hand to be
deemed to constitute an agency, partnership or joint venture. The terms of
this Agreement are not intended to cause any of the parties and their
Affiliates to become a joint employer for any purpose. Each of the parties
agrees that the provisions of this Agreement as a whole are not intended to,
and do not, constitute control of the other party (or any Affiliates of the
other party) or provide it with the ability to control such other party or such
other party's employees, agents and representatives under this Agreement (or
any Affiliates of the other party), and each party to this Agreement expressly
disclaims any right or power under this Agreement to exercise any power
whatsoever over the management or policies of the other party (or any
Affiliates of the other party). Nothing in this Agreement obligates either
party to act in breach of the requirements of any Legal Requirements.
6. Governing Law. Except to the extent that the Bankruptcy Code
or Bankruptcy Rules are applicable, this Agreement will be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to its conflict of laws principles.
7. Assignment. Neither party may assign, transfer or convey
any right, obligation or duty, in whole or in part, or any other interest under
this Agreement, without the prior written consent of the other party, except
that AMCE has the right to assign, transfer, or convey its rights, obligations
and duties to any Affiliate. Any such assignment, transfer, or conveyance
permitted hereunder will not relieve such transferring or assigning party of
liability for its responsibilities and obligations hereunder. All obligations
and duties of a party under this Agreement will be binding on all successors in
interest and permitted assigns of such party.
8. Force Majeure/Delay. No party will be responsible for delays
in or suspension of performance caused by acts of God or a Governmental
Authority or acts of war or terrorism unless such delays or suspensions (or
parts of such delays or suspensions) could have been prevented upon the
exercise of reasonable diligence in accordance with industry standards;
provided, that such party has a duty reasonably to mitigate, or cause to be
mitigated, any such delays or suspensions (or parts of such delays or
suspensions).
9. Entire Agreement. This Agreement (together with the
schedules to this Agreement, which are incorporated into this Agreement by this
reference) and that certain letter agreement respecting confidentiality and
nondisclosure dated June 29, 2001 between GCX and AMCE contains the entire
agreement between the parties to this Agreement with respect to the subject
matter of this Agreement and supersedes all prior agreements and
understandings, oral or written, with respect to such matters.
10. Third-Party Rights. Nothing contained in this Agreement,
express or implied, establishes or creates, or is intended or will be construed
to establish or create, any right in or remedy of, or any duty or obligation
to, any third party.
11. Notices. Any notice, request, demand, waiver, consent,
approval or other communication that is required or permitted under this
Agreement must be in writing and will be deemed given only if delivered
personally or sent by registered or certified mail or by Federal Express or
other reputable overnight mail service, postage prepaid, or by telefacsimile,
with written confirmation to follow, as follows:
(a) If to GCX, to:
GC Companies, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Attention: G. Xxxx Xxxxxxx
With a copy to: Xxxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
With a required copy to (which will not itself constitute
notice):
Xxxxxxx Procter LLP
Exchange Place
Boston, Massachusetts 02109
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
(b) If to AMCE, to:
AMC Entertainment Inc.
000 X. 00xx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
With a required copy to (which will not itself constitute
notice):
Xxxxxxx & Xxxx X.X.
0000 Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx, Xx., Esq.
Facsimile: (000) 000-0000
or to such other address or facsimile numbers as the addressee may have
specified in a notice duly given to the sender as provided in this Agreement.
Such notice, request, demand, waiver, consent, approval or other communication
will be deemed to have been given as of the date so delivered or, if such date
is not a Business Day, on the next Business Day.
12. Counterparts. This Agreement and any amendments to this
Agreement may be executed in one or more counterparts, each of which will be
deemed to be an original by the parties executing such counterpart, but all of
which will be considered one and the same instrument.
13. Amendment; Waiver. Any provision of this Agreement may be
amended or waived if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by each of the parties, or in the case of
a waiver, by the party against whom the waiver is to be effective, subject in
each case to approval of the Bankruptcy Court where required. No failure or
delay by any party in exercising any right, power or privilege under this
Agreement will operate as a waiver of such right, power or privilege nor will
any single or partial exercise of such right, power or privilege preclude any
other or further exercise of such right, power or privilege or the exercise of
any other right, power or privilege.
14. Severability. The provisions of this Agreement will be
deemed severable and the invalidity or unenforceability of any provision will
not affect the validity or enforceability of the other provisions of this
Agreement unless such invalidity or unenforceability, after taking into account
the mitigation contemplated by the next sentence, deprives a party of a
material benefit contemplated by this Agreement. If any provision of this
Agreement, or the application of such provision to any Person or any
circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision will be substituted therefor in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid or unenforceable
provision and (b) the remainder of this Agreement and the application of such
provision to other persons, entities or circumstances will not be affected by
such invalidity or unenforceability, nor will such invalidity or
unenforceability affect the validity or enforceability of such provision, or
the application of such provision, in any other jurisdiction.
15. Specific Performance. The parties hereto recognize that any
breach of the terms of this Agreement may give rise to irreparable harm for
which money damages would not be an adequate remedy, and accordingly agree,
that, in addition to other remedies, the nonbreaching party will be entitled to
enforce the terms of this Agreement by a decree of specific performance without
the necessity of proving the inadequacy of a remedy of money damages and
without the posting of any bond or other security.
16. Interpretation of Agreement. The section headings contained
in this Agreement are for reference purposes only and do not in any way affect
the meaning or interpretation of this Agreement. The words "includes" and
"including" are not words of limitation and should be read to also add "without
limitation." References to the singular include the plural and vice versa, and
reference to one gender include all genders, unless the context otherwise
requires.
[The remainder of this page intentionally left blank.]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
AMC ENTERTAINMENT INC.
By:/s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Chairman, Chief Executive Officer and
President
GC COMPANIES, INC.
By:/s/ G. Xxxx Xxxxxxx
G. Xxxx Xxxxxxx
President, Chief Operating Officer and
Chief Financial Officer
10
Execution Copy
950223.13 (conformed execution copy)
SIGNATURE PAGE TO INTERIM OPERATING AGREEMENT
