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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________________________________________________

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, ~~2016~~2017

Commission file number: 001-31315

____________________________________________________________________________

Regal Entertainment Group

(Exact name of Registrant as Specified in Its Charter)

Delaware(State or Other Jurisdiction ofIncorporation or Organization)		02-0556934(I. R. S. EmployerIdentification Number)
7132 Regal LaneKnoxville, TN(Address of Principal Executive Offices)		37918(Zip Code)
101 East Blount AvenueKnoxville, TN(Address of Principal Executive Offices)		37920(Zip Code)

Registrant's Telephone Number, Including Area Code: 865-922-1123

____________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:



Title of each class		Name of each exchange on which registered
Class A Common Stock, $.001 par value		New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K: x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or aan ~~smaller~~emerging ~~reporting~~growth company. See the definitions of "large accelerated filer," "accelerated filer," ~~and~~ "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act (Check one):

Large accelerated filer x Accelerated filer o Non-accelerated filer o (Do not check if asmaller reporting company) Smaller reporting company o Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act): Yes o No x

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant on June 30, ~~2016~~2017, computed by reference to the price at which the registrant's Class A common stock was last sold on the New York Stock Exchange on such date was $12,~~774~~297,~~940~~118,~~796.16~~163 (80112,~~532~~273,~~704~~615 shares at a closing price per share of $2220.0446).

Shares of ~~Class A~~Common ~~common~~Stock ~~stock~~ outstanding—~~133~~1,~~337,241~~000 shares at ~~February~~March 201, ~~2017~~2018

Shares of Class B common stock outstanding—23,708,639 shares at February 20, 2017

DOCUMENTS INCORPORATED BY REFERENCE

Certain portions of the registrant's definitive proxy statement on Schedule 14A to be used in connection with its 2017 Annual Meeting of Stockholders and to be filed within 120 days after December 31, 2016 are incorporated by reference into Part III, Items 10-14, of this report on Form 10-K.

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TABLE OF CONTENTS

PART I
Item 1.	BUSINESS	4
	THE COMPANY	4
	DESCRIPTION OF BUSINESS	4
	INDUSTRY OVERVIEW AND TRENDS	7
	THEATRE OPERATIONS	6
	THEATRE OPERATIONS	7
	NATIONAL CINEMEDIA JOINT VENTURE	7
	NATIONAL CINEMEDIA JOINT VENTURE	10
	DCIP AND OPEN ROAD FILMS JOINT VENTURES	7
	DIGITAL CINEMA IMPLEMENTATION PARTNERS JOINT VENTURE	10
	FILM DISTRIBUTION	7
	OPEN ROAD FILMS, DCDC AND ATOM TICKETS JOINT VENTURES	11
	FILM EXHIBITION	7
	FILM DISTRIBUTION	11
	CONCESSIONS	8
	FILM EXHIBITION	11
	COMPETITION	8
	CONCESSIONS	12
	SEASONALITY	9
	COMPETITION	12
	EMPLOYEES	9
	MARKETING AND ADVERTISING	13
	EXECUTIVE OFFICERS OF THE REGISTRANT	9
	INFORMATION TECHNOLOGY SYSTEMS	13
	REGULATION	10
	SEASONALITY	14
	FORWARD-LOOKING STATEMENTS	10
	EMPLOYEES	14
Item 1A.	RISK FACTORS	10
	EXECUTIVE OFFICERS OF THE REGISTRANT	14
Item 1B.	UNRESOLVED STAFF COMMENTS	13
	REGULATION	15
Item 2.	PROPERTIES	14
	FORWARD-LOOKING STATEMENTS	15
Item 3.	LEGAL PROCEEDINGS	14
Item 1A.	RISK FACTORS	15
Item 4.	MINE SAFETY DISCLOSURES	14
Item 1B.	UNRESOLVED STAFF COMMENTS	20
Item 2.	PROPERTIES	21
Item 3.	LEGAL PROCEEDINGS	21
Item 4.	MINE SAFETY DISCLOSURES	21
PART II
Item 5.	MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	2114
Item 6.	SELECTED FINANCIAL DATA	2215
Item 7.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	2417
	Overview And Basis Of Presentation	2417
	Critical Accounting Estimates	2418
	Significant Events And Fiscal 2017 Outlook	26
	Results Of Operations	20
	Recent Developments	28
	Quarterly Results	25
	Results Of Operations	28
	Liquidity And Capital Resources	26
	Quarterly Results	33
	Contractual Cash Obligations and Commitments	28
	Off-Balance Sheet Arrangements	30
	Recent Accounting Pronouncements	30
Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	32
Item 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	33

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	Liquidity And Capital Resources	34
Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	83
	Contractual Cash Obligations and Commitments	37
Item 9A.	CONTROLS AND PROCEDURES	83
	Off-Balance Sheet Arrangements	38
Item 9B.	OTHER INFORMATION	83
	Recent Accounting Pronouncements	38
Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	38
Item 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	40
Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	88
Item 9A.	CONTROLS AND PROCEDURES	88
Item 9B.	OTHER INFORMATION	88
PART III
Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	8883
Item 11.	EXECUTIVE COMPENSATION	8984
Item 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	8993
Item 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	8994
Item 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES	8995
PART IV
Item 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES	9097
SIGNATURES		91
Item 16.	FORM 10-K SUMMARY	98
SIGNATURES		100

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Explanatory Note

On December 5, 2017, Regal Entertainment Group entered into an Agreement and Plan of Merger (the "Merger Agreement") with Cineworld Group plc, a public limited company incorporated in England and Wales ("Cineworld"), Crown Intermediate Holdco, Inc., a Delaware corporation and an indirect, wholly owned subsidiary of Cineworld ("US Holdco"), and Crown Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of US Holdco (the "Merger Sub"). On February 28, 2018, following the satisfaction of the conditions in the Merger Agreement, Merger Sub was merged with and into the Company (the "Merger") pursuant to the Merger Agreement. As a result of the Merger, the Company became an indirect, wholly-owned subsidiary of Cineworld, the Company’s Class A common stock will no longer be listed on the New York Stock Exchange, and the registration of shares of the Company’s Class A common stock under the Exchange Act will be terminated. Unless otherwise noted, all references in this Annual Report on Form 10-K (this “Form 10-K”) to Regal Entertainment Group, a Delaware corporation, “we,” “us,” “our,” the “Company” or “Regal,” refer to the Company and its business prior to the Merger. This Form 10-K does not reflect any changes in the Company’s business plan that may occur over time as a result of the Merger and the Company becoming part of the Cineworld group of companies.

REGAL ENTERTAINMENT GROUP

PART I

The information in this ~~Annual Report on~~ Form 10-K ~~(this "Form 10-K")~~ contains certain forward-looking statements, including statements related to trends in the Company's business. The Company's actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include those discussed in "Business," "Risk Factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations" as well as those discussed elsewhere in this Form 10-K.

Item 1. BUSINESS.

THE COMPANY

Regal ~~Entertainment~~was ~~Group, a Delaware corporation~~ organized on March 6, 2002 ~~("we,"~~and ~~"us," "our," the "Company" or "Regal"),~~ is the parent company of Regal Entertainment Holdings, Inc. ("REH"), which is the parent company of Regal Cinemas Corporation ("Regal Cinemas") and its subsidiaries. Regal Cinemas' subsidiaries include Regal Cinemas, Inc. ("RCI") and its subsidiaries, which include Edwards Theatres, Inc. ("Edwards"), Regal CineMedia Corporation ("RCM") and United Artists Theatre Company ("United Artists"). The terms Regal or the Company, REH, Regal Cinemas, RCI, Edwards, RCM and United Artists shall be deemed to include the respective subsidiaries of such entities when used in discussions included herein regarding the current operations or assets of such entities. The Company manages its business under one reportable segment: theatre exhibition operations.

Our Internet address is www.regmovies.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and any amendments to these reports, are available free of charge on our Internet website under the heading "Investor Relations" as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission (the "Commission"). The contents of our Internet website are not incorporated into this report.

The Company manages its business under one reportable segment: theatre exhibition operations.

DESCRIPTION OF BUSINESS

Overview

We operate one of the largest and most geographically diverse theatre circuits in the United States, consisting of 7,~~267~~322 screens in ~~561~~560 theatres in 4243 states along with Guam, Saipan, American Samoa and the District of Columbia as of December 31, ~~2016~~2017, with approximately ~~211~~197 million attendees for the year ended December 31, ~~2016~~2017 ("fiscal ~~2016~~2017"). Our geographically diverse circuit includes theatres in 4648 of the top 50 U.S. designated market areas. We develop, acquire and operate multi-screen theatres primarily in mid-sized metropolitan markets and suburban growth areas of larger metropolitan markets throughout the United States. We operate our theatre circuit using our Regal Cinemas, United Artists, Edwards, Great Escape Theatres and Hollywood Theaters brands through our wholly owned subsidiaries.

~~For~~Our ~~fiscal~~business ~~2014~~strategy ~~and~~is ~~prior~~predicated ~~periods,~~on ~~the~~our ~~Company's~~ability ~~fiscal~~to ~~year~~allocate ~~ended~~capital oneffectively ~~the~~to ~~first~~enhance ~~Thursday~~value ~~after~~for ~~December 25,~~our ~~which~~stockholders. inThis ~~certain~~strategy ~~years~~focuses ~~(such~~on asenhancing ~~fiscal~~our ~~2014)~~position ~~resulted~~ in athe ~~53-week~~motion ~~fiscal~~picture ~~year.~~exhibition ~~Beginning~~industry ~~January~~by 2capitalizing on prudent industry consolidation and partnership opportunities, ~~2015~~managing, ~~the~~expanding ~~Company's~~and ~~fiscal~~upgrading ~~year~~our ~~changed~~existing ~~from~~asset abase ~~52-53~~with ~~week~~new ~~fiscal~~technologies ~~year~~and ~~ending~~customer onamenities ~~the~~and ~~first~~realizing ~~Thursday~~selective ~~after~~growth ~~December~~opportunities 25through ofnew ~~each~~theatre ~~year~~construction. toFor a fiscal ~~year~~2017, ~~ending~~we onreported ~~December~~total 31revenues, income from operations and net income attributable to controlling interest of ~~each~~$3,163.0 ~~year~~million, $271.7

For fiscal 2016, we reported total revenues, income from operations and net income attributable to controlling interest of $3,197.1 million, $339.4 million and $170.4 million, respectively. In addition, we generated $410.5 million of cash flows from operating activities during fiscal 2016.

Business Strategy

Our business strategy is predicated on our ability to allocate capital effectively to enhance value for our stockholders. This strategy focuses on enhancing our position in the motion picture exhibition industry by capitalizing on prudent industry consolidation and partnership opportunities, managing, expanding and upgrading our existing asset base with new technologies and customer amenities and realizing selective growth opportunities through new theatre construction. Our business strategy should enable us to continue to produce the free cash flow necessary to maintain a prudent allocation of our capital among dividend payments, debt service and repayment and investment in our theatre assets, all to provide meaningful value to our stockholders. Key elements of our business strategy include:

Maximizing Stockholder Value. We believe that our cash dividends are an efficient means of distributing value to our stockholders. From our initial public offering ("IPO") in May 2002 through December 31, 2016, we have returned approximately $4.2 billion to our stockholders in the form of quarterly and extraordinary cash dividends. During our most

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~~recent~~million ~~five~~and ~~year~~$112.3 ~~period~~million, werespectively. ~~returned~~In ~~approximately~~addition, we generated $1409.09 ~~billion~~million toof ~~our~~cash ~~stockholders~~flows infrom ~~quarterly~~operating ~~and~~activities ~~extraordinary~~during ~~cash~~fiscal ~~dividends~~2017.

Pursuing Prudent Acquisitions and Maximizing Strategic Partnerships. We believe that our acquisition experience and capital structure position us well to take advantage of future acquisition opportunities and to participate in various partnership initiatives. We intend to selectively pursue accretive theatre acquisitions and theatre-related investments that enhance and more fully utilize our asset base to improve our consolidated operating results and free cash flow.

With respect to partnership initiatives, we own approximately 19.7% of National CineMedia, LLC ("National CineMedia" or "NCM") as of December 31, 2016. National CineMedia operates the largest digital in-theatre advertising network in North America and focuses on in-theatre advertising for its theatrical exhibition partners, which includes us, AMC Entertainment, Inc. ("AMC"), and Cinemark, Inc. ("Cinemark"). See "National CineMedia Joint Venture" under Part I, Item I of this Form 10-K for further discussion of National CineMedia. We also participate in other joint ventures and partnerships such as Digital Cinema Implementation Partners, LLC ("DCIP"), Open Road Films, AC JV, LLC ("AC JV"), Digital Cinema Distribution Coalition ("DCDC") and Atom Tickets, LLC ("Atom Tickets"), which are also further discussed under Part I, Item I of this Form 10-K. We believe our investment in National CineMedia and other joint venture arrangements generate incremental value for our stockholders.

Pursuing Premium Experience Opportunities. We continue to embrace innovative concepts that generate incremental revenue and cash flows for the Company and deliver a premium movie-going experience for our customers on several complementary fronts:

• First, we continued to improve customer amenities, primarily through the installation of luxury reclining seats. With respect to our luxury reclining seating initiative, as of December 31, 2016, we offered luxury reclining seating in 1,369 auditoriums at 113 theatre locations. We expect to install luxury reclining seating in approximately 40-45 locations during 2017 and expect to outfit approximately 45% of the total screens in our circuit by the end of 2019. The costs of these conversions in some cases are partially covered by contributions from our theatre landlords.

• Second, to address consumer trends and customer preferences, we have continued to expand our menu of food and alcoholic beverage products to an increasing number of attendees. The enhancement of our food and alcoholic beverage offerings has had a positive effect on our operating results, and we expect to continue to invest in such offerings in our theatres. As of December 31, 2016, we offered an expanded menu of food in 216 locations (reaching approximately 53% of our fiscal 2016 attendees) and alcoholic beverages in 143 locations (reaching approximately 28% of our fiscal 2016 attendees), and we expect to offer an expanded menu of food in approximately 270 locations and alcoholic beverages in approximately 215 locations by the end of 2017.

• Third, we continued to implement various customer engagement initiatives aimed at delivering a premium movie-going experience for our customers in order to better compete for patrons and build brand loyalty. For example, we maintain a frequent moviegoer loyalty program, named the Regal Crown Club®, to actively engage our core customers. During the first quarter of 2016, we completed the national rollout of the new Regal Crown Club®. Members of the enhanced program can earn unlimited credits and can redeem such credits for movie tickets, concession items and movie memorabilia at the theatre or in an online reward center where members can select the rewards of their choice. We believe these changes allow us to offer more relevant offers to our members and increase customer engagement in the program. As of December 31, 2016, we had approximately 11.8 million active members in the Regal Crown Club®, making it the largest loyalty program in our industry.

• In addition, we continued to develop and enhance other customer engagement initiatives such as mobile ticketing applications, internet ticketing, social media and other marketing initiatives. For example, we have improved the customer experience of purchasing tickets by expanding our ability to sell tickets remotely via our mobile ticketing application and through our internet ticketing partners such as Fandango.com and Atom Tickets. Customers can choose their preferred ticketing option, which in many cases means they can pre-purchase tickets, scan their mobile device and proceed directly to their reserved seat without waiting in line. In addition to providing customers the ability to pre-purchase tickets, our mobile ticketing application provides customers the ability to find films, movie information, showtimes, track Regal Crown Club® credits and receive special offers from Regal. Finally, at nearly one third of our locations, our newest ticketing partner, Atom Tickets, provides our patrons the ability to bypass concession stand lines by pre-purchasing concession items via their mobile device. We believe these technologies provide a platform for delivering a quality customer experience and will drive incremental revenues and cash flows in a more cost-effective manner.

• Finally, our IMAX® digital projection systems and our proprietary large screen format, RPXSM, offer our patrons all-digital, large format premium experiences and generate incremental revenue and cash flows for the Company. As of December 31, 2016, our IMAX® footprint consisted of 89 IMAX® screens, and we operated 93 RPXSM

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~~screens.~~THEATRE We continue to selectively install RPXSM screens where we can generate a financial return, and we have recently agreed to install an additional 11 IMAX® digital projection systems, which will ultimately expand our IMAX® footprint to 100 screens. OPERATIONS

The following table details the number of locations and theatre screens in our theatre circuit ranked by the number of screens in each state along with Guam, Saipan, American Samoa and the District of Columbia as of December 31, 2017:

We believe the continued rollout of premium amenities such as luxury reclining seating, a wider array of food and alcoholic beverage offerings and IMAX® and RPXSM screens allow us to deliver a premium movie-going experience for a majority of our customers. We believe this strategy will enable us to better compete for patrons and build brand loyalty, which we believe will provide us the opportunity for incremental revenue and cash flows.



State/District	Locations	Number of Screens
California	87	1,061
Florida	46	683
New York	44	549
Virginia	30	429
Texas	28	415
Washington	29	347
Pennsylvania	23	311
Georgia	20	298
Ohio	19	274
North Carolina	20	256
South Carolina	17	230
Oregon	19	206
Maryland	14	196
Tennessee	13	179
Colorado	13	162
New Jersey	11	154
Nevada	11	141
Indiana	11	139
Illinois	9	129
Missouri	8	114
Massachusetts	9	106
Kansas	8	92
Idaho	5	73
Hawaii	7	72
Oklahoma	5	69
Kentucky	5	60
New Mexico	4	54
Alabama	3	52
Alaska	4	49
Mississippi	6	46
West Virginia	4	46
Connecticut	4	43
Louisiana	4	43
New Hampshire	3	33
Delaware	2	33
Michigan	2	26
Arkansas	2	24
Maine	2	20
Minnesota	1	16
Nebraska	1	16
Arizona	1	14
District of Columbia	1	14
Guam	1	14
Utah	1	14
Montana	1	11
Saipan	1	7
American Samoa	1	2
Total	560	7,322

Pursuing Selective Growth Opportunities and Active Asset Management. We intend to selectively pursue expansion opportunities through new theatre construction, expansion and upgrades that meet our strategic and financial return criteria. Additionally, we manage our asset base by opportunistically closing underperforming theatres. We continued to actively manage our asset base during fiscal 2016 by opening two theatres with 19 screens, reopening five screens at an existing theatre and closing 13 theatres and 118 screens, ending the year with 561 theatres and 7,267 screens.

Competitive Strengths

We believe that the following competitive strengths position us to capitalize on future opportunities:

Industry Leader. We are one of the largest domestic motion picture exhibitors operating 7,267 screens in 561 theatres in 42 states along with Guam, Saipan, American Samoa and the District of Columbia. Our geographically diverse circuit includes theatres in 46 of the top 50 U.S. designated market areas. We believe that the quality and size of our theatre circuit is a significant competitive advantage for negotiating attractive national contracts and generating economies of scale. We believe that our market leadership allows us to capitalize on favorable attendance trends and attractive consolidation and partnership opportunities.

Superior Management Drives Strong Operating Margins. Our operating philosophy focuses on efficient operations and strict cost controls at both the corporate and theatre levels. At the corporate level, we are able to capitalize on our size and operational expertise to achieve economies of scale in purchasing and marketing functions. We have developed an efficient purchasing and distribution supply chain that generates favorable concession margins. At the theatre level, management devotes significant attention to cost controls through the use of financial data analysis, detailed management reports and performance-based compensation programs to encourage theatre managers to deliver a premium customer experience while effectively controlling costs and maximizing free cash flow.

Proven Acquisition and Integration Expertise. We have significant experience identifying, completing and integrating acquisitions of theatre circuits. Since our 2002 IPO, we have demonstrated our ability to enhance revenues and realize operating efficiencies through the successful acquisition and integration of nine theatre circuits, consisting of 230 theatres and 2,683 screens. We have generally achieved immediate synergies at acquired theatres and improved their profitability through the application of our consolidated operating functions and key supplier contracts, and our relationship with National CineMedia.

Quality Theatre Portfolio. We believe that we operate one of the most modern theatre circuits among major motion picture exhibitors. Approximately 59% of our locations featured one or more premium amenity offerings as of December 31, 2016. We believe the continued rollout of premium amenities such as luxury reclining seating, a wider array of food and alcoholic beverage offerings and IMAX® and RPXSM screens allow us to deliver a premium movie-going experience for a majority of our customers. Finally, we believe that our modern theatre portfolio coupled with our operating margins should allow us to generate significant cash flows from operations.

Dividend Policy

We believe that paying dividends on our shares of common stock is important to our stockholders. To that end, during fiscal 2016, we paid to our stockholders four quarterly cash dividends of $0.22 per share on each outstanding share of our Class A and Class B common stock, or approximately $138.9 million in the aggregate. Further, on February 9, 2017, the Company declared a cash dividend of $0.22 per share on each share of the Company's Class A and Class B common stock (including outstanding restricted stock), payable on March 15, 2017 to stockholders of record on March 3, 2017. Declared dividends have been or will be funded through cash flow from operations and available cash on hand. We, at the discretion of our Board of Directors and subject to applicable law, anticipate paying regular quarterly dividends on our Class A and Class B common stock for the foreseeable future. The amount, if any, of the dividends to be paid in the future will depend upon our then available cash, anticipated cash needs, overall financial condition, loan agreement restrictions, future prospects for earnings and cash flows, as well as other relevant factors. Dividends are considered quarterly and may be paid only when, and in such amounts as, approved by our Board of Directors.

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INDUSTRY OVERVIEW AND TRENDS

The domestic motion picture exhibition industry is a mature business that has historically maintained steady long-term growth in revenues and stable attendance. Since 1965, total box office revenues have grown at a compound annual growth rate of approximately 5%, with annual attendance of approximately 1.3 billion attendees in 2016. Against this background of steady long-term growth in revenues, the exhibition industry has experienced periodic short-term increases and decreases in attendance and in turn box office revenues. Consequently, we expect the cyclical nature of the domestic motion picture exhibition industry to continue for the foreseeable future. However, we believe that long-term trends in motion picture attendance in the U.S. will continue to benefit the domestic motion picture exhibition industry. For example, during the most recent five-year period, attendance levels remained stable and the industry generated record box office results during 2012, 2013, 2015 and 2016.

Through the years, the domestic motion picture exhibition industry has experienced increased competition from other methods of delivering content to consumers including digital sell-through, DVD and Blu-ray, physical and digital rental, subscription video on demand and free and pay television. Traditionally, when motion picture distributors license their films to the domestic exhibition industry, they refrain from licensing their products to other delivery channels for a period of time, commonly called the theatrical release window. Over the past several years, the average period between a film's theatrical release and its release in the next distribution channel has contracted slightly to approximately three to four months. Further, some film distributors have experimented with offering alternative distribution methods for certain films that rely on shorter theatrical release windows and in some cases, bypass the theatrical release altogether. We believe that a material contraction of the theatrical release window could significantly dilute the consumer appeal of the out-of-home motion picture offering. As a result, we continue to monitor the status of the theatrical release window during our film licensing decisions. Fundamentally, we believe that movie-going is a convenient, affordable and attractively priced form of out-of-home entertainment, which, on an average price per patron basis, continues to compare favorably to other out-of-home entertainment alternatives, such as concerts and sporting events.

Finally, the domestic motion picture exhibition industry is in the process of implementing various initiatives, concepts and customer amenities aimed at delivering a premium movie-going experience for its customers in order to better compete for patrons and build brand loyalty, which we believe will provide us the opportunity for incremental revenue and cash flows. These initiatives include luxury reclining seating, a wider array of food and beverage offerings, in-theatre dining and bar service, reserved seating, the enhancement of loyalty programs and other customer engagement initiatives such as mobile ticketing applications, internet ticketing, social media and other marketing initiatives. In addition, we believe the benefits associated with premium motion picture formats are significant for our industry and provide us with the opportunity for incremental revenue from formats such as IMAX® and our proprietary large screen format, RPXSM. Finally, we believe that operating a digital theatre circuit provides greater flexibility in scheduling our programming content, which has enhanced our capacity utilization, and enables us to generate incremental revenue from motion picture formats, such as digital 3D, and the exhibition of specialty content offerings through certain distributors, such as AC JV. We are optimistic that these and other recent industry initiatives and trends will drive continued growth and strength for the domestic motion picture industry.

THEATRE OPERATIONS

We operate one of the largest theatre circuits in the United States with 7,267 screens in 561 theatres in 42 states along with Guam, Saipan, American Samoa and the District of Columbia as of December 31, 2016. We operate theatres in 46 of the top 50 U.S. designated market areas. We target prime locations with excellent access to large, high patron-traffic areas. We operate our theatre circuit using our Regal Cinemas, United Artists, Edwards, Great Escape Theatres and Hollywood Theaters brands through our wholly owned subsidiaries.

We operate multi-screen theatres. Our multi-screen theatre complexes typically contain 10 to 18 screens, each with auditoriums ranging from 100 to 500 seats. As a result, our theatres appeal to a diverse group of patrons because we offer a wide selection of films and convenient show times. In addition, many of our theatres feature state-of-the-art amenities such as immersive sound, wall-to-wall and floor-to-ceiling screens, Sony Digital CinemaTM 4K projection systems, 3D digital projection systems, IMAX® and our proprietary large screen format, RPXSM, digital stereo surround-sound and enhanced interiors featuring video game and party room areas adjacent to the theatre lobby. Finally, we are in the process of implementing various other initiatives, concepts and customer amenities such as luxury reclining seating, a wider array of food and beverage offerings, in-theatre dining and bar service and reserved seating.

Our modern, multi-screen theatres are designed to increase profitability by optimizing revenues per square foot while reducing our operational costs on a per attendee basis. We vary auditorium seating capacities within the same theatre, allowing us to exhibit films on a more cost effective basis for a longer period of time by shifting films to smaller auditoriums to meet changing attendance levels. In addition, we realize significant operating efficiencies by having common box office, concessions, projection, lobby and restroom facilities, which enable us to spread some of our costs, such as payroll, advertising,

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rent and utility costs over a higher revenue base. We strategically schedule movie show times to reduce staffing requirements and box office and concession line congestion and to provide more desirable parking and traffic flow patterns. We also actively monitor ticket sales in order to quickly recognize demand surges, which enables us to add seating capacity quickly and efficiently. In addition, we offer various forms of convenient ticketing methods, including print-at-home technology, self-serve kiosks, e-gift cards and mobile and internet ticketing. We believe that operating a theatre circuit consisting primarily of modern theatres enhances our ability to attract patrons and believe theatres larger than the current 10 to 18 screen megaplex are not able to generate attractive returns in most locations because of the substantial market suitability requirements to generate a level of profitability similar to the current megaplex format.

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State/District	Locations	Number of Screens
California	88	1,063
Florida	48	709
New York	45	555
Virginia	30	429
Washington	29	347
Texas	26	374
Pennsylvania	23	311
North Carolina	22	265
Georgia	21	307
Ohio	19	274
Oregon	19	206
South Carolina	17	230
Maryland	14	196
Colorado	14	174
Tennessee	13	179
Nevada	11	141
Indiana	11	139
New Jersey	10	142
Massachusetts	10	118
Illinois	9	129
Missouri	8	114
Hawaii	7	72
Mississippi	6	46
Idaho	5	73
Kentucky	5	60
New Mexico	5	60
Alaska	5	52
West Virginia	4	46
Connecticut	4	43
Louisiana	4	43
Alabama	3	52
Kansas	3	34
Oklahoma	3	34
New Hampshire	3	33
Minnesota	2	36
Delaware	2	33
Michigan	2	26
Arkansas	2	24
Maine	2	20
Nebraska	1	16
Arizona	1	14
District of Columbia	1	14
Guam	1	14
Montana	1	11
Saipan	1	7
American Samoa	1	2
Total	561	7,267

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We have implemented a best practices management program across all of our theatres that provides daily, weekly, monthly and quarterly management reports for each individual theatre, and we maintain active communication between the theatres, divisional management and corporate management. We use these management reports and communications to closely monitor admissions and concessions revenues as well as accounting, payroll and workforce information necessary to manage our theatre operations effectively and efficiently.

We seek experienced theatre managers and require new theatre managers to complete a comprehensive training program within the theatres and at the "Regal Entertainment University," which is held at our corporate office. The program is designed to encompass all phases of theatre operations, including our operating philosophy, policies, procedures and standards. In addition, we have an incentive compensation program for theatre-level management that rewards theatre managers for controlling operating expenses while complying with our operating standards.

In addition, we have implemented quality assurance programs in all of our theatres to maintain clean, comfortable and modern facilities and monitor food service. To maintain quality and consistency within our theatre circuit, district and regional managers and various contractual service partners regularly inspect each theatre and provide recurring feedback. In addition, we consistently solicit feedback from our patrons through an on-line guest experience program whereby our guests rate and provide detailed comments regarding their experiences at our theatres. Finally, we also conduct a "mystery shopper" program, which involves unannounced visits by unidentified customers who report on the quality of service, film presentation and cleanliness at individual theatres.

NATIONAL CINEMEDIA JOINT VENTURE

We maintain an investment in National CineMedia, which operates the largest digital in-theatre advertising network in North America representing over 20,~~500~~800 U.S. theatre screens (of which approximately 20,~~100~~400 are part of National CineMedia's digital content network) as of December 31, ~~2016~~2017. ~~During~~ 2016, over 700 million patrons attended movies shown in theatres in which National CineMedia currently has exclusive cinema advertising agreements in place. National CineMedia focuses on in-theatre advertising for its theatrical exhibition partners, which includes us, AMC and Cinemark.

We receive theatre access fees and mandatory distributions of excess cash from National CineMedia. ~~Pursuant~~ to our Common Unit Adjustment Agreement, from time to time, common units of National CineMedia held by Regal, AMC and Cinemark will be adjusted up or down through a formula primarily based on increases or decreases in the number of theatre screens operated and theatre attendance generated by each joint venture partner. As of December 31, ~~2016~~2017, we held approximately 27.16 million common units of National CineMedia. On a fully diluted basis, we own a 1917.79% interest in NCM, Inc. as of December 31, ~~2016~~2017.

~~During~~See ~~fiscal~~Note 4 ~~2013,~~to ~~National~~the ~~CineMedia~~consolidated ~~sold~~financial ~~its~~statements ~~"Fathom~~included ~~Events"~~in ~~business~~Part II, toItem 8 ACof ~~JV,~~this ~~a newly~~Form 10-~~formed~~K ~~Delaware~~for ~~limited~~further ~~liability~~discussion ~~company owned 32% by each~~ of ~~RCI, AMC and Cinemark and 4% by~~ National CineMedia. ~~The Fathom Events business markets~~ and ~~distributes~~related live and pre-recorded entertainment programming to various theatre operators (including us, AMC and Cinemark) to provide additional programs to augment their feature film schedule and includes events such as live and pre-recorded concerts, opera and symphony, DVD product releases and marketing events, theatrical premieres, Broadway plays, live sporting events and other special eventstransactions.

~~See~~DCIP ~~Note 4~~AND toOPEN ~~the~~ROAD ~~consolidated~~FILMS ~~financial~~JOINT ~~statements included in Part II, Item 8 of this Form 10-K for further discussion of National CineMedia and related transactions, including AC JV.~~VENTURES

~~DIGITAL~~We ~~CINEMA~~maintain ~~IMPLEMENTATION~~an ~~PARTNERS~~investment ~~JOINT~~in ~~VENTURE~~DCIP, a joint venture company formed by Regal, AMC Entertainment Holdings, Inc. ("AMC") and Cinemark Holdings, Inc. ("Cinemark"). DCIP funds the cost of digital projection equipment principally through the collection of virtual print fees from motion picture studios and equipment lease payments from participating exhibitors, including us. In addition to its U.S. digital deployment, DCIP actively manages the deployment of over 1,800 digital systems in Canada for Canadian Digital Cinema Partnership, a joint venture between Cineplex Inc. and Empire Theatres Limited.

WeThe ~~maintain~~Company anholds ~~investment in DCIP,~~ a ~~joint~~46.7% ~~venture~~economic ~~company~~interest ~~formed~~in ~~by Regal, AMC and Cinemark.~~ DCIP ~~funds~~as ~~the cost~~ of ~~digital projection principally through the collection of virtual print fees from motion picture studios and equipment lease payments from participating exhibitors~~December 31, ~~including us~~2017. ~~DCIP’s~~As ~~initial~~of ~~and~~December 31, ~~second~~2017, ~~round~~all of ~~financing~~our ~~substantially~~screens ~~covered~~were ~~the~~fully ~~cost~~outfitted ofwith ~~conversion to~~ digital projection ~~for our entire circuit~~systems. InPlease ~~addition~~refer to ~~its~~Note 4 ~~U.S.~~to ~~digital deployment, DCIP actively manages~~ the ~~deployment~~consolidated offinancial ~~over~~statements ~~1,800~~included ~~digital systems~~ in ~~Canada for Canadian Digital Cinema Partnership~~Part II, aItem 8 ~~joint~~of ~~venture~~this ~~between~~Form 10-K ~~Cineplex~~for ~~Inc.~~further ~~and~~discussion ~~Empire~~of ~~Theatres Limited~~DCIP.

~~The~~On August 4, 2017, the Company ~~holds~~sold aall ~~46.7~~of its 50% ~~economic~~equity interest in ~~DCIP~~Open asRoad ofFilms, ~~December 31~~a film distribution company jointly owned by us and AMC, ~~2016. As~~to a third party for total proceeds of ~~December 31,~~approximately ~~2016~~$14.0 million. In accordance with the purchase agreement, ~~all~~approximately $3.7 million of ~~our~~the ~~screens~~net proceeds received were ~~fully~~in ~~outfitted~~satisfaction ~~with~~of ~~digital~~various ~~projection~~receivables ~~systems. Please~~and ~~refer~~other amounts due to ~~Note 4~~the Company related to film marketing services provided to Open Road Films prior to the ~~consolidated~~closing ~~financial~~date. ~~statements~~As ~~included~~a inresult ~~Part II~~of the sale, ~~Item 8~~the Company recorded a gain of ~~this~~approximately ~~Form~~ $17.8 million, representing the difference between the net proceeds received of $10-K.3 ~~for~~million ~~further~~(after ~~discussion~~satisfaction of ~~DCIP~~the above amounts due the Company) and the carrying amount of the Company's investment in Open Road Films (approximately $(7.5) million) as of the closing date. Also effective with closing, the Company and Open Road Films entered into a new marketing agreement with respect to films released by Open Road Films after the closing date.

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OPEN ROAD FILMS, DCDC AND ATOM TICKETS JOINT VENTURES

We maintain an investment in Open Road Films, a film distribution company jointly owned by us and AMC. Open Road Films was created to fill a gap in the marketplace created by the major studios’ big-budget franchise film strategy by marketing smaller budget films in a cost-effective manner, which we believe will drive additional patrons to our theatres. Open Road Films distributed seven films and generated national box office revenues of approximately $107.0 million during 2016 and intends to distribute approximately six to eight films per year. The Company has committed to a cash investment of $30.0 million in Open Road Films, and as of December 31, 2016, the Company has funded a total of $28.3 million of its initial $30.0 million commitment. The carrying value of the Company's investment in Open Road Films as of December 31, 2016 was $(1.7) million.

The Company is a party to a joint venture with certain exhibitors and distributors called DCDC. DCDC has established a satellite distribution network that distributes digital content to theatres via satellite. The Company has an approximate 14.6% ownership in DCDC as of December 31, 2016. The carrying value of the Company's investment in DCDC was approximately $2.8 million as of December 31, 2016.

Finally, we maintain an investment in Atom Tickets, an internet ticketing partner of the Company. At nearly one third of our locations, Atom Tickets provides our patrons the ability to bypass concession stand lines by pre-purchasing concession items via their mobile device. The carrying value of the Company's investment in Atom Tickets was approximately $5.0 million as of December 31, 2016.

Please refer to Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for further discussion of Open Road Films, DCDC and Atom Tickets.

FILM DISTRIBUTION

Domestic movie theatres are the primary initial distribution channel for domestic film releases. The theatrical success of a film is often the most important factor in establishing its value in other film distribution channels. Motion pictures are generally made available through several alternative distribution methods after the theatrical release date, including digital sell-through, DVD and Blu-ray, physical and digital rental, subscription video on demand and free and pay television. A strong theatrical opening often establishes a film's success and positively influences the film's potential in these downstream distribution channels. ~~As the primary distribution mechanism for the public's evaluation of films, we believe that domestic theatrical distribution remains the cornerstone of a film's overall financial success.~~

The development of additional distribution channels has given motion picture producers the ability to generate a greater portion of a film's revenues through channels other than its theatrical release. Historically, this potential for increased revenue after a film's initial theatrical release has enabled major motion picture studios and some independent producers to increase the budgets for film production and advertising.

FILM EXHIBITION

Evaluation of Film. We license films on a film-by-film and theatre-by-theatre basis by negotiating directly with film distributors. Prior to negotiating for a film license, we evaluate the prospects for upcoming films. Criteria we consider for each film may include cast, producer, director, genre, budget, comparative film performances and various other market conditions. Successful licensing depends greatly upon the exhibitor's knowledge of trends and historical film preferences of the residents in markets served by each theatre, as well as the availability of commercially successful motion pictures.

~~Access to~~ Film ~~Product~~Rental Fees. ~~Films~~Film ~~are~~licenses ~~licensed~~typically ~~from~~specify ~~film~~rental ~~distributors~~fees ~~owned~~or formulas by ~~major~~which ~~production~~rental ~~companies~~fees ~~and~~may ~~from~~be ~~independent~~calculated. ~~film~~The ~~distributors~~majority ~~that~~of ~~distribute~~our ~~films~~arrangements ~~for~~use ~~smaller~~a ~~production~~"sliding ~~companies~~scale" formula. Under ~~Film~~a ~~distributors~~sliding ~~typically~~scale ~~establish~~formula, ~~geographic~~the ~~licensing~~distributor ~~zones~~receives a percentage of the box office receipts using a pre-determined and ~~allocate~~mutually ~~each~~agreed ~~available~~upon film torental ~~one~~template. ~~theatre~~This ~~within~~formula ~~that~~establishes ~~zone~~film rental predicated on box office performance and is the predominant formula used by us to calculate film rental fees. To a much lesser extent, we have also used a "firm term" formula and a "review or settlement" method where either (1) the exhibitor and

In licensing zones where we are the sole exhibitor, we obtain film licenses by selecting a film from among those films being offered and negotiating directly with the distributor. In zones where there is competition, a distributor may allocate films among the exhibitors in the zone or choose to offer their films to some or all exhibitors in the zone. When films are licensed under the allocation process, a distributor will select an exhibitor for each film who then negotiates film rental terms directly with the distributor.7

Film Rental Fees. Film licenses typically specify rental fees or formulas by which rental fees may be calculated. The majority of our arrangements use a "sliding scale" formula. Under a sliding scale formula, the distributor receives a percentage of the box office receipts using a pre-determined and mutually agreed upon film rental template. This formula establishes film rental predicated on box office performance and is the predominant formula used by us to calculate film rental fees. To a much lesser extent, we have also used a "firm term" formula and a "review or settlement" method where either (1) the exhibitor and distributor agree prior to the exhibition of the film on a specified percentage of the box office receipts to be remitted to the

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distributor agree prior to the exhibition of the film on a specified percentage of the box office receipts to be remitted to the distributor or (2) the exhibitor and distributor negotiate a percentage of the box office receipts to be remitted to the distributor upon completion of the theatrical engagement.

Duration of Film Licenses. The duration of our film licenses are negotiated with our distributors on a case-by-case basis. The terms of our license agreements depend on performance of each film. Marketable movies that are expected to have high box office admission revenues will generally have longer license terms than movies with more uncertain performance and popularity.

Relationship with Distributors. Many distributors provide quality first-run movies to the motion picture exhibition industry. We license films from each of the major distributors and believe that our relationships with these distributors are good. For fiscal ~~2016~~2017, films shown from our top ten film distributors accounted for approximately 9593% of our admissions revenues. Our revenues attributable to individual distributors may vary significantly from year to year depending upon the commercial success of each distributor's motion pictures in any given year. In ~~2016~~2017, our largest single distributor accounted for 2622.81% of our box office admissions.

CONCESSIONS

In addition to box office admissions revenues, we generated approximately 29.24% of our total revenues from concessions sales during fiscal ~~2016~~2017. We emphasize prominent and appealing concession stations designed for rapid and efficient service. We continually seek to increase concessions sales by actively managing concession line congestion, optimizing product mix and through expansion of our concession offerings, introducing special promotions from time to time and offering employee training and incentive programs to up-sell and cross-sell products. We have favorable concession supply contracts and have developed an efficient concession purchasing and distribution supply chain. We have historically maintained strong brand relationships and management negotiates directly with these manufacturers for many of our concession items to obtain competitive prices and to ensure adequate supplies.

To address consumer trends and customer preferences, we have continued to expand our menu of food and alcoholic beverage products to an increasing number of attendees. The enhancement of our food and alcoholic beverage offerings has had a positive effect on our operating results~~, and we expect to continue to invest in such offerings in our theatres~~. As of December 31, ~~2016~~2017, we offered an expanded menu of food in ~~216~~270 locations (reaching ~~approximately 53~~63% of our ~~fiscal 2016~~ attendees) and alcoholic beverages in ~~143~~175 locations (reaching ~~approximately 28~~38% of our ~~fiscal 2016~~ attendees)~~, and we expect to offer an expanded menu of food in approximately 270 locations and alcoholic beverages in approximately 215 locations by the end of 2017~~.

COMPETITION

The motion picture exhibition industry is highly competitive. Motion picture exhibitors generally compete on the basis of the following competitive factors:


•	ability to secure films with favorable licensing terms;


•	availability of customer amenities (including luxury reclining seating), location, reputation, stadium seating and seating capacity;


•	quality of projection and sound systems;


•	appeal of our concession products; and


•	ability and willingness to promote the films that are showing.

We have several hundred competitors nationwide that vary substantially in size, from small independent exhibitors to large national chains such as AMC and Cinemark. As a result, our theatres are subject to varying degrees of competition in the regions in which they operate. Our competitors, including newly established motion picture exhibitors, may build new theatres or screens in areas in which we operate, which may result in increased competition and excess capacity in those areas. If this occurs, it may have an adverse effect on our business and results of operations. As one of the largest motion picture exhibitors, however, we believe that we will be able to generate economies of scale and operating efficiencies that will give us a competitive advantage over many of our competitors. As discussed in "Industry Overview and Trends" under Part I, Item I of this Form 10-K, the domestic motion picture exhibition industry is in the process of implementing various initiatives and concepts aimed at delivering a premium movie-going experience for its customers in order to better compete for patrons and build brand loyalty. We are optimistic that these and other recent industry initiatives and trends will drive continued growth and strength for the domestic motion picture industry. To that end, our market share may be positively or negatively impacted by such initiatives and trends during any given fiscal period.

12We also compete with other motion picture distribution channels including digital sell-through, DVD and Blu-ray, physical and digital rental, subscription video on demand and free and pay television. Other technologies could also have an

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We also compete with other motion picture distribution channels including digital sell-through, DVD and Blu-ray, physical and digital rental, subscription video on demand and free and pay television. Other technologies could also have an adverse effect on our business and results of operations. When motion picture distributors license their products to the domestic exhibition industry, they refrain from licensing their motion pictures to these other distribution channels for a period of time, commonly called the theatrical release window. Over the past several years, the theatrical release window has contracted to approximately three to four months. Further, some film distributors have experimented with offering alternative distribution methods for certain films that rely on shorter theatrical release windows and in some cases, bypass the theatrical release altogether. We believe that a material contraction of the theatrical release window could significantly dilute the consumer appeal of the out-of-home motion picture offering. As a result, we continue to monitor the status of the theatrical release window during our film licensing decisions.

In addition, we compete for the public's leisure time and disposable income with other forms of entertainment, including sporting events, concerts, live theatre and restaurants.

MARKETING AND ADVERTISING

Currently, film distributors organize and finance multimedia advertising campaigns for major film releases. To market our theatres, we utilize internet, mobile and social media, print and multimedia advertising to inform our patrons of film selections and show times. In many of our markets, we employ special interactive marketing programs for specific films and concessions items.

Our frequent moviegoer loyalty program, Regal Crown Club®, is designed to actively engage our core customers and is the largest loyalty program in our industry. Through the Regal Crown Club®, we seek to enhance the customer experience and increase the frequency and amounts of purchases to generate additional revenue. During the first quarter of 2016, we completed the national rollout of the new Regal Crown Club®. Members of the enhanced program can earn unlimited credits and can redeem such credits for movie tickets, concession items and movie memorabilia at the theatre or in an online reward center where members can select the rewards of their choice. We believe these changes allow us to provide more relevant offers to our members and increase customer engagement in the program. As of December 31, 2016, we had approximately 11.8 million active members in the Regal Crown Club®, and these members accounted for approximately $1.1 billion of the Company's box office and concession revenues during fiscal 2016. Our mobile ticketing application, designed to give customers quick access to box office information via their Apple iPhone® or Android™ phone, has been downloaded approximately 6.1 million times since its fiscal 2012 launch. The application provides customers the ability to find films, movie information, showtimes and special offers from Regal and the ability to purchase tickets for local theatres, thereby expediting the admissions process. Additionally, the application helps customers stay up-to-date on the latest coupons and Regal Crown Club® loyalty program promotions.

In addition, we seek to develop patron loyalty through a number of other marketing programs such as summer children's film series and promotions within local communities.

INFORMATION TECHNOLOGY SYSTEMS

Information Technology ("IT") is focused on the customer experience and supporting the efficient operation of our theatres, the management of our business and other revenue-generating opportunities. The revenue streams generated by attendance and concession sales are fully supported by information systems to monitor cash flow and to detect fraud and inventory shrinkage. We have implemented software and hardware solutions which provide for enhanced capabilities and efficiency within our theatre operations. These solutions have enabled us to sell gift cards at various major retailers, grocery and warehouse stores and to redeem those gift cards at our theatre box offices and concession stands.

We continue to focus on improving the customer experience of purchasing tickets by expanding our ability to sell tickets remotely via our mobile application and through our internet ticketing partners such as Fandango.com and Atom Tickets, and self-service alternatives, such as ticketing kiosks and print-at-home ticketing. Customers can choose their preferred ticketing option, which in many cases means they can pre-purchase tickets, scan their mobile device and proceed directly to their reserved seat without waiting in line. In addition to providing customers the ability to pre-purchase tickets, our mobile application provides customers the ability to find films, movie information, showtimes, track Regal Crown Club® credits and receive special offers from Regal. Lastly, at nearly one third of our locations, our newest ticketing partner, Atom Tickets, provides our patrons the ability to bypass concession stand lines by pre-purchasing concession items via their mobile device. These technologies provide a platform for delivering a quality customer experience and will drive incremental revenues and cash flows in a more cost-effective manner.

In addition, we continue to strategically pursue technologies to improve the services we provide to our patrons and to provide information to our management allowing them to operate our theatres efficiently. Our scheduling systems support the

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coordination needed to properly allocate our auditoriums between film showings and meetings and events, while also ensuring that movie audiences view the intended advertising and that revenue is allocated to the appropriate business function. The scheduling systems also provide scheduling information electronically and automatically to media outlets, including newspapers and various online media outlets to drive attendance in our theatres. The sales and attendance information collected by the theatre systems is used directly for film booking and settlement as well as provides the primary source of data for our financial systems.

SEASONALITY

The timing of movie releases can have a significant effect on our results of operations, and the results of one fiscal quarter are not necessarily indicative of results for the next fiscal quarter or any other fiscal quarter. ~~Historically,~~ ~~motion picture studios release the most marketable motion pictures during the summer and the holiday season.~~ The unexpected emergence of a hit film during other periods can alter the traditional trend. The seasonality of motion picture exhibition, however, has become less pronounced as motion picture studios are releasing motion pictures somewhat more evenly throughout the year.

EMPLOYEES

As of December 31, ~~2016~~2017, we employed approximately 2526,~~359~~000 persons. The Company considers its employee relations to be good.

EXECUTIVE OFFICERS OF THE REGISTRANT

Shown below are the names, ages and positions of our executive officers as of ~~December 31,~~the ~~2016,~~filing ~~and~~of ~~current~~this ~~positions~~Annual Report on Form 10-K. Any changes to be effected as a result of consummation of the Merger are reflected on our ~~executive~~Current ~~officers~~Report on Form 8-K filed on February 28, 2018. There are no family relationships between any of the persons listed below, or between any of such persons and any of the directors of the Company or any persons nominated or chosen by the Company to become a director or executive officer of the Company.

Name	Age	Position
Amy E. Miles	5051	Chief Executive Officer and Chair of the Board of Directors
Gregory W. Dunn	5758	President and Chief Operating Officer
Peter B. Brandow	5657	Executive Vice President, General Counsel and Secretary
David H. Ownby	4748	Executive Vice President, Chief Financial Officer and Treasurer

Amy E. Miles is our Chief Executive Officer and Chair of the Board of Directors. Ms. Miles has served as Chief Executive Officer since June 2009 and became Chair of the Board of Directors in March 2015. Prior thereto, Ms. Miles served as our Executive Vice President, Chief Financial Officer and Treasurer from March 2002 to June 2009. Additionally, Ms. Miles has served as the Chief Executive Officer of Regal Cinemas, Inc. since June 2009. Ms. Miles formerly served as the Executive Vice President, Chief Financial Officer and Treasurer of Regal Cinemas, Inc. from January 2000 to June 2009. Prior thereto, Ms. Miles served as Senior Vice President of Finance from April 1999, when she joined Regal Cinemas, Inc. Prior to joining the Company, Ms. Miles was a Senior Manager with Deloitte & Touche LLP from 1998 to 1999. From 1989 to 1998, she was with PricewaterhouseCoopers LLP.

Gregory W. Dunn is our President and Chief Operating Officer. Mr. Dunn has served as an Executive Vice President and Chief Operating Officer of Regal since March 2002 and became President of Regal in May 2005. Mr. Dunn served as Executive Vice President and Chief Operating Officer of Regal Cinemas, Inc. from 1995 to March 2002. Prior thereto, Mr. Dunn served as Vice President of Marketing and Concessions of Regal Cinemas, Inc. from 1991 to 1995.

Peter B. Brandow is our Executive Vice President, General Counsel and Secretary and has served as such since March 2002. Mr. Brandow has served as the Executive Vice President, General Counsel and Secretary of Regal Cinemas, Inc. since July 2001, and prior to that time he served as Senior Vice President, General Counsel and Secretary of Regal Cinemas, Inc. since February 2000. Prior thereto, Mr. Brandow served as Vice President, General Counsel and Secretary from February 1999 when he joined Regal Cinemas, Inc. From September 1989 to January 1999, Mr. Brandow was an associate with the law firm Simpson Thacher & Bartlett LLP.

David H. Ownby is our Executive Vice President, Chief Financial Officer and Treasurer and has served in this capacity since June 2009. Mr. Ownby also has served as our Chief Accounting Officer since May 2006. Mr. Ownby served as our Senior Vice President of Finance from March 2002 to June 2009. Prior thereto, Mr. Ownby served as the Company's Vice President of Finance and Director of Financial Projects from October 1999 to March 2002. Prior to joining the Company, Mr. Ownby served with Ernst & Young LLP from September 1992 to October 1999.9

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REGULATION

The distribution of motion pictures is in large part regulated by federal and state antitrust laws and has been the subject of numerous antitrust cases. Consent decrees effectively require major film distributors to offer and license films to exhibitors, including us, on a film-by-film and theatre-by-theatre basis. Consequently, exhibitors cannot assure themselves of a supply of films by entering into long-term arrangements with major distributors, but must negotiate for licenses on a film-by-film basis.

Our theatres must comply with Title III of the Americans with Disabilities Act of 1990 (the "ADA") to the extent that such properties are "public accommodations" and/or "commercial facilities" as defined by the ADA. Compliance with the ADA requires that public accommodations "reasonably accommodate" individuals with disabilities and that new construction or alterations made to "commercial facilities" conform to accessibility guidelines unless "structurally impracticable" for new construction or technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, award of damages to private litigants and additional capital expenditures to remedy such non-compliance.

We believe that we are in substantial compliance with all current applicable regulations relating to accommodations for the disabled. We intend to comply with future regulations in this regard and except as set forth in Note 8 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, we do not currently anticipate that compliance will require us to expend substantial funds.

Our theatre operations are also subject to federal, state and local laws governing such matters as wages, working conditions, citizenship and health and sanitation and environmental protection requirements. We believe that we are in substantial compliance with all relevant laws and regulations.

FORWARD-LOOKING STATEMENTS

Some of the information in this Form 10-K includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements other than statements of historical facts included in this Form 10-K, including, without limitation, certain statements under "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" may constitute forward-looking statements. In some cases you can identify these forward-looking statements by words like "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of those words and other comparable words. These forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those indicated in these statements as a result of certain risk factors as more fully discussed under "Risk Factors" below.

Item 1A. RISK FACTORS.

~~Investing in our securities involves a significant degree of risk.~~ In addition to the other information contained in this Form 10-K, you should consider the following factors ~~before investing in our securities~~.

Our substantial lease and debt obligations could impair our financial condition.

We have substantial lease and debt obligations. ~~For~~If ~~fiscal~~we ~~2016,~~are ~~our~~unable ~~total~~to ~~rent~~meet ~~expense~~our lease and ~~net~~debt ~~interest~~service ~~expense~~obligations, ~~were~~we ~~approximately~~could ~~$427.6~~be ~~million~~forced ~~and~~to ~~$128.1~~restructure ~~million,~~or ~~respectively. As~~refinance ofour ~~December 31,~~obligations ~~2016,~~and weseek ~~had~~additional ~~total~~financing ~~debt~~or ~~obligations~~sell ~~of $2,340~~assets.1 ~~million. As~~We ofmay ~~December 31,~~be ~~2016,~~unable weto ~~had~~restructure ~~total~~or ~~contractual~~refinance ~~cash~~our obligations ofand ~~approximately~~obtain ~~$6,040.4~~additional ~~million. For~~financing aor ~~detailed~~sell ~~discussion~~assets ofon ~~our~~satisfactory ~~contractual~~terms ~~cash~~or ~~obligations~~at ~~and~~all. ~~other~~As ~~commercial~~a ~~commitments~~result, ~~over~~ the ~~next~~inability ~~several~~to ~~years,~~meet ~~refer~~our tolease ~~"Management's~~and ~~Discussion~~debt ~~and~~service ~~Analysis~~obligations ofcould ~~Financial~~cause ~~Condition~~us ~~and~~to ~~Results~~default ofon ~~Operations—Contractual~~those ~~Cash~~obligations. Any ~~Obligations~~such ~~and~~defaults ~~Commitments"~~could ~~provided~~materially inimpair ~~Part II,~~our ~~Item 7~~financial ofcondition ~~this~~and ~~Form 10-K~~liquidity.

If we are unable to meet our lease and debt service obligations, we could be forced to restructure or refinance our obligations and seek additional equity financing or sell assets. We may be unable to restructure or refinance our obligations and obtain additional equity financing or sell assets on satisfactory terms or at all. As a result, the inability to meet our lease and debt service obligations could cause us to default on those obligations. The agreements governing the terms of our debt obligations contain restrictive covenants that limit our ability to take specific actions (including paying dividends to our stockholders) or require us not to allow specific events to occur and prescribe minimum financial maintenance requirements that we must meet. If we violate those restrictive covenants or fail to meet the minimum financial requirements contained in a debt instrument, we could be in default under that instrument, which could, in turn, result in defaults under other debt instruments. Any such defaults could materially impair our financial condition and liquidity. In addition, we may incur additional indebtedness in the future, subject to the restrictions contained in the agreements governing the terms of our debt obligations. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify.

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To service our indebtedness, we will require a significant amount of cash, which depends on many factors beyond our control.

Our ability to make payments on our debt and other financial obligations will depend on the ability of our subsidiaries to generate substantial operating cash flow. This will depend on future performance, which will be subject to prevailing economic conditions and to financial, business and other factors beyond our control. If our and our subsidiaries' cash flows prove inadequate to meet our and their debt service and other obligations in the future, we may be required to refinance all or a portion of our and our subsidiaries' existing or future debt, on or before maturity, sell assets, obtain additional financing or suspend the payment of dividends. We cannot assure you that we will be able to refinance any indebtedness, sell any such assets or obtain additional financing on commercially reasonable terms or at all.

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suspend the payment of dividends. We cannot assure you that we will be able to refinance any indebtedness, sell any such assets or obtain additional financing on commercially reasonable terms or at all.

We depend on motion picture production and performance and our relationships with film distributors.

Our ability to operate successfully depends upon the availability, diversity and commercial appeal of motion pictures, our ability to license motion pictures and the performance of such motion pictures in our markets. We license first-run motion pictures, the success of which can depend on the marketing efforts of the major motion picture studios. Poor performance of, or any disruption in the production of, these motion pictures (including by reason of a strike or lack of adequate financing), or a reduction in the marketing efforts of the major motion picture studios, could hurt our business and results of operations. In addition, a change in the type and breadth of movies offered by motion picture studios may adversely affect the demographic base of moviegoers.

The distribution of motion pictures is in large part regulated by federal and state antitrust laws and has been the subject of numerous antitrust cases. Consent decrees resulting from those cases effectively require major motion picture distributors to offer and license films to exhibitors, including us, on a film-by-film and theatre-by-theatre basis. Consequently, we cannot assure ourselves of a supply of motion pictures by entering into long-term arrangements with major distributors, but must compete for our licenses on a film-by-film and theatre-by-theatre basis. In addition, the film distribution business is highly concentrated, with the top ten film distributors accounting for approximately 9593% of our admissions revenues during fiscal ~~2016~~2017. Our business depends on maintaining good relations with these distributors. We are dependent on our ability to negotiate commercially favorable licensing terms for first-run films. A deterioration in our relationship with any of the major film distributors could affect our ability to negotiate film licenses on favorable terms or our ability to obtain commercially successful films and, therefore, could hurt our business and results of operations.

An increase in the use of alternative film delivery methods may drive down movie theatre attendance and reduce our revenue.

We compete with other motion picture distribution channels including digital sell-through, DVD and Blu-ray, physical and digital rental, subscription video on demand and free and pay television. When motion picture distributors license their products to the domestic exhibition industry, they refrain from licensing their motion pictures to these other distribution channels during the theatrical release window. The average theatrical release window has decreased from approximately six months to approximately three to four months over the last decade. Further, some film distributors have experimented with offering alternative distribution methods for certain films that rely on shorter theatrical release windows and in some cases, bypass the theatrical release altogether. We believe that a material contraction of the current theatrical release window could significantly dilute the consumer appeal of the in-theatre motion picture offering, which could have a material adverse effect on our business and results of operations. We can provide no assurance as to the impact or timing of any material contraction to the current theatrical release window.

Our theatres operate in a competitive environment.

The motion picture exhibition industry is fragmented and highly competitive with no significant barriers to entry. Theatres operated by national and regional circuits and by small independent exhibitors compete with our theatres, particularly with respect to film licensing, attracting patrons and developing new theatre sites. Moviegoers are generally not brand conscious and usually choose a theatre based on its location, the films showing there and its amenities.

The motion picture exhibition industry has and continues to implement various initiatives, concepts, customer amenities and technological innovations aimed at delivering a premium movie-going experience for its patrons (including, but not limited to, luxury reclining seating, enhancement of food and alcoholic beverage offerings, the installation of premium format screens, digital 3D, 4DX, satellite distribution technologies and stadium seating). Theatres in our markets without these amenities may be more vulnerable to competition than those theatres with such amenities, and should other theatre operators choose to implement these or other initiatives in these markets, the performance of our theatres may be significantly and negatively impacted. In addition, while we continue to implement these and other initiatives, new innovations and technology will continue to impact our industry. If we are unable to respond to or invest in future technology and the changing preferences of our customers, we may not be able to compete with other exhibitors or other entertainment venues, which could also adversely affect our results of operations. Finally, should other theatre operators embark on aggressive capital spending strategies, our attendance, revenue and income from operations per screen could decline substantially.

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operations. Finally, should other theatre operators embark on aggressive capital spending strategies, our attendance, revenue and income from operations per screen could decline substantially.

We are currently the subject of an investigation by the Antitrust Division of the Department of Justice and Attorneys General in several states and have been named as defendants in third party lawsuits related to similar matters.

We are currently the subject of an investigation by the DOJ regarding potentially anticompetitive conduct and coordination among NCM, AMC, the Company and/or Cinemark, under Sections 1 and 2 of the Sherman Act, 15 U.S.C. § 1 and § 2. Additionally, we are the subject of investigations by various state attorneys general relating to our investments in various joint ventures, including NCM, as well as movie “clearances” whereby film distributors do not license the rights to exhibitors to play the same first-run feature length films at the same time in the same theatrical release zones. In addition, we have been named as defendants in lawsuits commenced by other theatre operators who claim the Company has engaged in anti-competitive conduct by virtue of these clearances.

The Company intends to cooperate with any Federal or state investigations to the extent any are undertaken. While we do not believe that the Company has engaged in any violation of Federal or state antitrust or competition laws related to its investments in NCM, other joint ventures, or as pertains to movie clearances, and while the Company intends to vigorously defend any allegation that it has done so, we can provide no assurances as to the scope, timing or outcome of the DOJ’s, any other state or Federal governmental reviews of the Company’s conduct, or any third party lawsuits initiated regarding the same or similar matters. If we are subject to an adverse finding or ruling resulting from any of these investigations or lawsuits, we could be required to pay damages or penalties or have other remedies imposed upon us that could have a material adverse effect on our business. In addition, we have already incurred substantial legal expenses related to these matters and we may incur significant additional expenditures in the future. Furthermore, the period of time necessary to fully respond to and resolve these investigations and lawsuits is uncertain and could require significant management time and financial resources which could otherwise be devoted to the operation of our business. 11

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exhibitors to play the same first-run feature length films at the same time in the same theatrical release zones. In addition, in the past, we have been named as defendants in lawsuits commenced by other theatre operators who claim the Company has engaged in anti-competitive conduct by virtue of these clearances.

The Company has cooperated with the Federal and state investigations that have been undertaken. While we do not believe that the Company has engaged in any violation of Federal or state antitrust or competition laws related to its investments in NCM, other joint ventures, or as pertains to movie clearances, and while the Company intends to vigorously defend any allegation that it has done so, we can provide no assurances as to the scope, timing or outcome of the DOJ’s, any other state or Federal governmental reviews of the Company’s conduct. If we are subject to an adverse finding or ruling resulting from any of these investigations, we could be required to pay damages or penalties or have other remedies imposed upon us that could have a material adverse effect on our business. In addition, we have already incurred substantial legal expenses related to these matters and we may incur significant additional expenditures in the future. Furthermore, the period of time necessary to fully respond to and resolve these investigations is uncertain and could require significant management time and financial resources which could otherwise be devoted to the operation of our business.

We may not benefit from our acquisition strategy and strategic partnerships.

WeIdentifying ~~may have difficulty identifying~~ suitable acquisition candidates and partnership opportunities may be difficult. In the case of acquisitions, even if we are able to identify suitable candidates, wethere ~~anticipate~~can be significant competition from other motion picture exhibitors and financial buyers when trying to acquire these candidates, and there can be no assurances that wethe ~~will~~Company would be able to acquire such candidates at reasonable prices or on favorable terms. Moreover, some of these possible buyers may be stronger financially than we are. As a result of this competition for limited assets, wethere ~~may~~is ~~not~~no assurance that the Company could succeed in acquiring suitable candidates or may have to pay more than we would prefer to make an acquisition. If we cannot identify or successfully acquire suitable acquisition candidates, wethere ~~may~~is ~~not~~no beassurance ~~able~~that ~~to successfully expand our operations and~~ the ~~market~~Company ~~price of our securities~~ could besuccessfully ~~adversely~~expand ~~affected.~~its operations.

In any acquisition, we expect to benefit from cost savings through, for example, the reduction of overhead and theatre level costs, and from revenue enhancements resulting from the acquisition. There can be no assurance, however, that we will be able to generate sufficient cash flow from these acquisitions to service any indebtedness incurred to finance such acquisitions or realize any other anticipated benefits. Nor can there be any assurance that our profitability will be improved by any one or more acquisitions. If we cannot generate anticipated cash flows resulting from acquisitions or fail to realize their anticipated benefits, our results of operations and profitability could be adversely affected. Any acquisition may involve operating risks, such as:


•	the difficulty of assimilating the acquired operations and personnel and integrating them into our current business;


•	the potential disruption of our ongoing business;


•	the diversion of management's attention and other resources;


•	the possible inability of management to maintain uniform standards, controls, procedures and policies;


•	the risks of entering markets in which we have little or no experience;


•	the potential impairment of relationships with employees and landlords;


•	the possibility that any liabilities we may incur or assume may prove to be more burdensome than anticipated; and


•	the possibility that any acquired theatres or theatre circuit operators do not perform as expected.

We also maintain theatre-related investments and partnership opportunities that enhance and more fully leverage our asset base to improve our consolidated operating results and free cash flow. On Asa offully ~~December 31,~~diluted ~~2016~~basis, we own ~~approximately~~a 1917.79% ofinterest ~~National~~in ~~CineMedia~~NCM, ~~and~~Inc. as of December 31, 2017. We also participate in other joint ventures such as DCIP, ~~Open Road Films,~~ AC JV, Digital Cinema Distribution Coalition (“DCDC”) and Atom Tickets. Risks associated with pursuing these investments and opportunities include:

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•	the difficulties and uncertainties associated with identifying investment and partnership opportunities that will successfully enhance and utilize our existing asset base in a manner that contributes to cost savings and revenue enhancement;


•	our inability to exercise complete voting control over the partnerships and joint ventures in which we participate; and


•	our partners may have economic or business interests or goals that are inconsistent with ours, exercise their rights in a way that prohibits us from acting in a manner which we would like or they may be unable or unwilling to fulfill their obligations under the joint venture or similar agreements.

Although we have not been materially constrained by our participation in National CineMedia or other joint ventures to date, no assurance can be given that the actions or decisions of other stakeholders in these ventures will not affect our investments in National CineMedia, DCIP, ~~Open Road Films,~~ AC JV, DCDC and Atom Tickets or other existing or future ventures in a way that hinders our corporate objectives or reduces any anticipated improvements to our operating results and free cash flow.

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In addition, any acquisitions or partnership opportunities are subject to the risk that the Antitrust Division of the DOJ or state or foreign competition authorities may require us to dispose of existing or acquired theatres or other assets in order to complete acquisition and partnership opportunities, pay damages and fines, or otherwise modify our normal operations as a result of our joint venture investments. The DOJ and various state attorneys general are currently investigating our investments in our various joint ventures, including NCM, for potentially anticompetitive conduct, as described more fully herein, and until such investigations are complete, we are not able to predict their outcome.

We rely on our information systems to conduct our business, and failure to protect these systems against security breaches could adversely affect our business and results of operations. Additionally, if these systems fail or become unavailable for any significant period of time, our business could be harmed.

The efficient operation of our business is dependent on computer hardware and software systems. Information systems are vulnerable to security breaches by computer hackers, cyber terrorists, employee error or misconduct, viruses and other catastrophic events, leading to unauthorized disclosure of confidential and proprietary information and exposing us to litigation that could adversely affect our reputation. We rely on industry accepted security measures and technology to protect confidential and proprietary information maintained on our information systems. However, these measures and technology may not adequately prevent security breaches. In addition, the unavailability of the information systems or the failure of these systems to perform as anticipated for any reason could disrupt our business and could result in decreased performance and increased operating costs, causing our business and results of operations to suffer. Any significant interruption or failure of our information systems or any significant breach of security could adversely affect our business and results of operations.

Economic, political and social conditions could materially affect our business by reducing consumer spending on movie attendance or could have an impact on our business and financial condition in ways that we currently cannot predict.

We depend on consumers voluntarily spending discretionary funds on leisure activities. We also compete for the public's leisure time and disposable income with other forms of entertainment, including sporting events, theme parks, concerts, live theatre and restaurants. Motion picture theatre attendance may be affected by negative trends in the general economy that adversely affect consumer spending. A prolonged reduction in consumer confidence or disposable income in general may affect the demand for motion pictures or severely impact the motion picture production industry, which, in turn, could adversely affect our operations. If economic conditions are weak or deteriorate, or if financial markets experience significant disruption, it could materially adversely affect our results of operations, financial position and/or liquidity. For example, deteriorating conditions in the global credit markets could negatively impact our business partners which may impact film production, the development of new theatres or the enhancement of existing theatres.

Theatre attendance may also be affected by political events, such as terrorist attacks on, or wars or threatened wars involving, the United States, health related epidemics and random acts of violence, any one of which could cause people to avoid our theatres or other public places where large crowds are in attendance. In addition, due to our concentration in certain markets, natural disasters such as hurricanes, earthquakes and severe storms in those markets could adversely affect our overall results of operations.

InAll ~~addition, our ability to access capital markets may be restricted at times when the implementation~~ of ~~our~~these ~~business~~factors ~~strategy may require us to do so, which~~ could ~~have~~adversely anaffect ~~impact on~~ our ~~flexibility~~financial tocondition ~~react to changing economic~~ and ~~business~~results ~~conditions. For example, our future ability to borrow on Regal Cinemas' senior credit facility or the effectiveness~~ of our remaining and future interest rate hedging arrangements could be negatively impacted if one or more counterparties files for bankruptcy protection or otherwise fails to perform their obligations thereunderoperations.

All of these factors could adversely affect our credit ratings, the market price of our Class A common stock and our financial condition and results of operations.

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We depend on our senior management.

Our success depends upon the retention of our senior management, including Amy Miles, our Chief Executive Officer. We cannot assure you that we would be able to find qualified replacements for the individuals who make up our senior management if their services were no longer available. The loss of services of one or more members of our senior management team could have a material adverse effect on our business, financial condition and results of operations. The loss of any member of senior management could adversely affect our ability to effectively pursue our business strategy.

We are subject to substantial government regulation, which could entail significant cost.

We are subject to various federal, state and local laws, regulations and administrative practices affecting our business, and we must comply with provisions regulating health and sanitation standards, equal employment, environmental, and licensing for the sale of food and, in some theatres, alcoholic beverages. Changes in existing laws or implementation of new laws, regulations and practices could have a significant impact on our business. A significant portion of our theatre level employees are paid at or slightly above the applicable minimum wage in the theatre's jurisdiction. Increases in the minimum wage and implementation of reforms requiring the provision of additional benefits will increase our labor costs.

Our theatres must comply with the ADA to the extent that such properties are "public accommodations" and/or "commercial facilities" as defined by the ADA. Compliance with the ADA requires that public accommodations "reasonably accommodate" individuals with disabilities and that new construction or alterations made to "commercial facilities" conform to accessibility guidelines unless "structurally impracticable" for new construction or technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, award of damages to private litigants and additional capital expenditures to remedy such non-compliance.

The interests of our controlling stockholder may conflict with your interests.

The Anschutz Corporation owns all of our outstanding Class B common stock. Our Class A common stock has one vote per share while our Class B common stock has ten votes per share on all matters to be voted on by stockholders. As a result, as of December 31, 2016, The Anschutz Corporation controlled approximately 69.0% of the voting power of all of our outstanding common stock. For as long as The Anschutz Corporation continues to own shares of common stock representing more than 50% of the voting power of our common stock, it will be able to elect all of the members of our Board of Directors, effect stockholder actions by written consent in lieu of stockholder meetings and determine the outcome of all matters submitted to a vote of our stockholders, including matters involving mergers or other business combinations, the acquisition or disposition of assets, the incurrence of indebtedness, the issuance of any additional shares of common stock or other equity securities and the payment of dividends on our common stock. The Anschutz Corporation will also have the power to prevent or cause a change in control, and could take other actions that might be desirable to The Anschutz Corporation but not to other stockholders. In addition, The Anschutz Corporation and its affiliates have controlling interests in companies in related and unrelated industries, including interests in the sports, motion picture production and music entertainment industries. In the future, it may combine our company with one or more of its other holdings.

Substantial sales of our Class A common stock could cause the market price for our Class A common stock to decline.

We cannot predict the effect, if any, that open-market sales of shares of our Class A common stock or the availability of shares of our Class A common stock for sale will have on the market price of our Class A common stock prevailing from time to time. Sales of substantial amounts of shares of our Class A common stock in the public market, including by the The Anschutz Corporation or its affiliates, or the perception that those sales will occur, could cause the market price of our Class A common stock to decline.

As of February 20, 2017, we had outstanding 23,708,639 shares of Class B common stock that may convert into Class A common stock on a one-for-one basis, all of which shares of common stock constitute "restricted securities" under the Securities Act. Provided the holders comply with the applicable volume limits and other conditions prescribed in Rule 144 under the Securities Act, all of these restricted securities are currently freely tradable.

In addition, The Anschutz Corporation and its affiliates are able to sell their shares pursuant to the registration rights that we have granted and may choose to do so at any time. To that end, on August 2, 2016, the Company entered into an underwriting agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated and The Anschutz Corporation and certain of its affiliates named therein (the “Selling Stockholders”). Pursuant to the underwriting agreement, the Selling Stockholders agreed to sell 13,000,000 shares of the Company’s Class A common stock, par value $0.001 per share, to Merrill Lynch, Pierce, Fenner & Smith Incorporated at a price of $21.60 per share. In addition, on November 17, 2016, the Company entered into an underwriting agreement with UBS Securities LLC and the Selling Stockholders. Pursuant to the underwriting agreement, the Selling Stockholders agreed to sell 13,000,000 shares of the Company’s Class A common stock, par value $0.001 per share, to UBS Securities LLC at a price of $22.95 per share. The Company did not receive any proceeds from the sales of the shares by the Selling Stockholders. The offerings were made pursuant to two prospectus supplements, dated August 3, 2016 and

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November 17, 2016, respectively, to the prospectus dated August 28, 2015 that was included in the Company’s effective shelf registration statement (Reg. No. 333-206656) relating to shares of the Company’s Class A common stock.

The Selling Stockholders owned 18,440,000 shares of our issued and outstanding Class A Common Stock, representing approximately 13.9% of our Class A common stock issued and outstanding as of December 31, 2016, which together with the 23,708,639 shares of our Class B common stock owned by the Selling Stockholders, represents approximately 69.0% of the combined voting power of the outstanding shares of Class A common stock and Class B common stock as of December 31, 2016.

We cannot predict whether substantial amounts of our Class A common stock will be sold in the open market in anticipation of, or following, any divestiture by The Anschutz Corporation or our directors or executive officers of their shares of our common stock.

Our amended and restated certificate of incorporation and our amended and restated bylaws contain anti-takeover protections, which may discourage or prevent a takeover of our company, even if an acquisition would be beneficial to our stockholders.

Provisions contained in our amended and restated certificate of incorporation and amended and restated bylaws, as amended, as well as provisions of the Delaware General Corporation Law, could delay or make it more difficult to remove incumbent directors or for a third party to acquire us, even if a takeover would benefit our stockholders.

Our issuance of shares of preferred stock could delay or prevent a change of control of our company.

Our Board of Directors has the authority to cause us to issue, without any further vote or action by the stockholders (unless otherwise required by the rules of the New York Stock Exchange), up to 50,000,000 shares of preferred stock, par value $0.001 per share, in one or more series, to designate the number of shares constituting any series, and to fix the rights, preferences, privileges and restrictions thereof, including dividend rights, voting rights, rights and terms of redemption, redemption price or prices and liquidation preferences of such series. The issuance of shares of preferred stock may have the effect of delaying, deferring or preventing a change in control of our company without further action by the stockholders, even where stockholders are offered a premium for their shares.

Our issuance of preferred stock could dilute the voting power of the common stockholders.

The issuance of shares of preferred stock with voting rights may adversely affect the voting power of the holders of our other classes of voting stock, either by diluting the voting power of our other classes of voting stock if they vote together as a single class, or by giving the holders of any such preferred stock the right to block an action on which they have a separate class vote, even if the action were approved by the holders of our other classes of voting stock.

Our issuance of preferred stock could adversely affect the market value of our common stock.

The issuance of shares of preferred stock with dividend or conversion rights, liquidation preferences or other economic terms favorable to the holders of preferred stock could adversely affect the market price for our common stock by making an investment in the common stock less attractive. For example, investors in the common stock may not wish to purchase common stock at a price above the conversion price of a series of convertible preferred stock because the holders of the preferred stock would effectively be entitled to purchase common stock at the lower conversion price causing economic dilution to the holders of common stock.

We are a holding company dependent on our subsidiaries for our ability to service our debt and pay our dividends.

We are a holding company with no operations of our own. Consequently, our ability to service our and our subsidiaries' debt and pay dividends on our common stock is dependent upon the earnings from the businesses conducted by our subsidiaries. Our subsidiaries are separate and distinct legal entities and have no obligation to provide us with funds for our payment obligations, whether by dividends, distributions, loans or other payments. Any distribution of earnings to us from our subsidiaries, or advances or other distributions of funds by these subsidiaries to us, all of which are subject to statutory or contractual restrictions, are contingent upon our subsidiaries' earnings and are subject to various business considerations. Our right to receive any assets of any of our subsidiaries upon their liquidation or reorganization, and therefore the right of the holders of our 53/4% Senior Notes due 2022 (the "53/4% Senior Notes Due 2022"), our 53/4% Senior Notes due 2023 (the "53/4% Senior Notes Due 2023"), our 53/4% Senior Notes due 2025 (the "53/4% Senior Notes Due 2025") and our common stock to participate in those assets, will be structurally subordinated to the claims of that subsidiary's creditors. In addition, even if we were a creditor of any of our subsidiaries, our rights as a creditor would be subordinate to any security interest in the assets of our subsidiaries and any indebtedness of our subsidiaries senior to that held by us.

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Item 1B. UNRESOLVED STAFF COMMENTS.

None.

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Item 2. PROPERTIES.

As of December 31, ~~2016~~2017, we operated ~~506~~502 theatre locations pursuant to lease agreements and owned the land and buildings in fee for 5558 theatre locations. For a list of the states in which we operated theatres and the number of theatres and screens operated in each such state as of December 31, ~~2016~~2017, please see the chart under Part I, Item 1 of this Form 10-K under the caption "Business—Theatre Operations," which is incorporated herein by reference.

The majority of our leased theatres are subject to lease agreements with original terms of 15 to 20 years or more and, in most cases, renewal options for up to an additional 10 to 20 years. These leases provide for minimum annual rentals and the renewal options generally provide for rent increases. Some leases require, under specified conditions, further rental payments based on a percentage of revenues above specified amounts. A significant majority of the leases are net leases, which require us to pay the cost of insurance, taxes and a portion of the lessor's operating costs. Our corporate office is located in Knoxville, Tennessee. We believe that these facilities are currently adequate for our operations.

Item 3. LEGAL PROCEEDINGS.

Pursuant to Rule 12b-23 under the Securities Exchange Act of 1934, as amended, the information required to be furnished by us under this Part I, Item 3 (Legal Proceedings) is incorporated by reference to the information contained in Note 8 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

In addition, on January 29, 2018 a purported class action complaint relating to the Merger, captioned Baldassano v. Regal Entertainment Group et al., Case No. 195178-3, was filed on behalf of the stockholders against members of the board of directors of the Company, the Company, Cineworld, US Holdco and Merger Sub in the Chancery Court for Knox County, Tennessee in the Sixth Judicial District at Knoxville (the “Action”). The Action alleged that the board of directors of the Company breached its fiduciary duties to the stockholders by means of (A) agreeing to an allegedly unfair price in the proposed merger and (B) allegedly engineering a transaction to benefit themselves and/or Cineworld without regard to the Company’s stockholders. The complaint also generally asserted that the Company, Cineworld, US Holdco and Merger Sub aided and abetted the board of directors’ breach of its fiduciary duties. The Action sought, among other things, to enjoin the consummation of the Merger, rescind the Merger Agreement (to the extent the Merger had already been consummated), damages, and attorneys’ fees and costs. On February 12, 2018, the Company and the plaintiff entered into a memorandum of understanding in which the plaintiff agreed to dismiss his claims with prejudice, and to dismiss claims asserted on behalf of the putative class without prejudice, in return for the Company’s agreement to make certain supplemental disclosures.

Item 4. MINE SAFETY DISCLOSURES.

Not applicable.

PART II

Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

~~Our~~Prior ~~common~~to ~~equity~~the ~~consists~~effective time of ~~Class A~~the ~~and~~Merger, ~~Class B~~the Company had two classes of common stock. Our Class A common stock ~~has~~ traded on the New York Stock Exchange ~~since~~(the "NYSE") from May 9, 2002 under the symbol "RGC." ~~There~~until isFebruary no28, ~~established~~2018, ~~public~~upon ~~trading~~closing ~~market~~of ~~for~~the Merger. All of our Class B common stock was owned by the Anschutz Corporation and the Anschutz Foundation.

The following table sets forth the historical high and low sales prices per share of our Class A common stock as reported by the New York Stock Exchange for the fiscal periods indicated.

	Fiscal 2016
	Fiscal 2017
	High		Low
First Quarter (January 1, 2016 - March 31, 2016)	$	21.82	$	16.50
First Quarter (January 1, 2017 - March 31, 2017)	$	23.56	$	20.73
Second Quarter (April 1, 2016 - June 30, 2016)	22.48		19.35
Second Quarter (April 1, 2017 - June 30, 2017)	22.88		19.87
Third Quarter (July 1, 2016 - September 30, 2016)	24.19		21.13
Third Quarter (July 1, 2017 - September 30, 2017)	20.59		13.90
Fourth Quarter (October 1, 2016 - December 31, 2016)	24.79		20.29
Fourth Quarter (October 1, 2017 - December 31, 2017)	23.09		14.79

	Fiscal 2015
	High		Low
First Quarter (January 2, 2015 - March 31, 2015)	$	24.52	$	18.70
Second Quarter (April 1, 2015 - June 30, 2015)	23.67		20.25
Third Quarter (July 1, 2015 - September 30, 2015)	21.98		17.48
Fourth Quarter (October 1, 2015 - December 31, 2015)	20.25		17.65

On February 20, 2017, there were approximately 238 stockholders of record of our Class A common stock and one stockholder of record of our Class B common stock. As of February 20, 2017 our officers, directors and key employees hold, or in the case of performance shares are eligible to receive, approximately 1,425,561 restricted shares of our Class A common stock, for which the restrictions lapse or the performance criteria and vesting may be satisfied, at various dates through

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January 11, 2021. All shares of restricted stock are registered and will be freely tradable when the restrictions lapse, unless such shares are issued to or acquired by an affiliate of Regal, in which case the affiliate may only sell the shares subject to the volume limitations imposed by Rule 144 of the Securities Act.



	Fiscal 2016
	High		Low
First Quarter (January 1, 2016 - March 31, 2016)	$	21.82	$	16.50
Second Quarter (April 1, 2016 - June 30, 2016)	22.48		19.35
Third Quarter (July 1, 2016 - September 30, 2016)	24.19		21.13
Fourth Quarter (October 1, 2016 - December 31, 2016)	24.79		20.29

On February 28, 2018, the Company notified the NYSE that the Merger had been completed and requested that

trading of the Company’s Class A common stock on the NYSE be suspended and an application on Form 25 be filed with the Commission by the NYSE to remove the Company's Class A common stock from listing on the NYSE and deregister the Company's Class A common stock under Section 12(b) of the Exchange Act. The Company intends to file a Form 15 with the Commission to terminate registration of the Company's Class A common stock under Section 12(g) of the Exchange Act and suspend reporting obligations relating to the Company's Class A common stock under Section 15(d) of the Exchange Act.

As of March 1, 2018, the Company had only one class of common stock and there was one stockholder of record.

Dividend Policy

During the fiscal year ended December 31, 2016 (the "Fiscal 2016 Period"), Regal paid four quarterly cash dividends of $0.22 per share on each outstanding share of the Company's Class A and Class B common stock, or approximately $138.9 million in the aggregate. During Onthe ~~February 9~~fiscal year ended December 31, 2017, (the ~~Company~~"Fiscal ~~declared~~2017 aPeriod"), Regal paid four quarterly cash ~~dividend~~dividends of $0.22 per share on each outstanding share of the Company's Class A and Class B common stock ~~(including outstanding restricted stock)~~, ~~payable~~or onapproximately ~~March~~$138.9 ~~15,~~million ~~2017~~in tothe ~~stockholders~~aggregate. ofOn ~~record on March~~February 37, ~~2017.~~2018, ~~Declared~~the ~~dividends~~Company ~~have~~declared ~~been~~a ~~or will be funded through~~ cash ~~flow~~dividend ~~from~~of ~~operations~~$0.22 ~~and~~per ~~available~~share ~~cash~~ on ~~hand.~~each ~~We,~~share atof the ~~discretion~~Company's ~~of our board of directors and subject to applicable law, anticipate paying regular quarterly dividends on our~~ Class A and Class B common stock ~~for~~(including ~~the~~outstanding ~~foreseeable~~restricted ~~future. The amount~~stock), ifwhich ~~any,~~was ~~of the dividends to be~~ paid inon ~~the~~February ~~future will depend upon our then available cash~~26, ~~anticipated~~2018 ~~cash~~to ~~needs,~~stockholders ~~overall~~of ~~financial~~record ~~condition,~~on ~~loan~~February ~~agreement restrictions~~17, ~~future prospects for earnings and cash flows, as well as other relevant factors~~2018. Declared ~~For a description of the loan agreement restrictions on the payment of~~ dividends, ~~see~~have ~~"Management's~~been ~~Discussion~~funded ~~and~~through ~~Analysis~~cash offlow ~~Financial~~from ~~Condition~~operations and ~~Results~~available ofcash ~~Operations—Liquidity~~on ~~and Capital Resources" included in Part II, Item 7 of this Form 10-K and Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K~~hand.

Unregistered Sales of Equity Securities and Use of Proceeds

None.

Issuer Purchases of Equity Securities

None.

Item 6. SELECTED FINANCIAL DATA.

The selected historical consolidated financial data as of and for the fiscal years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016, ~~January~~December 131, 2015, ~~December~~January 261, ~~2013~~2015, and December 2726, ~~2012~~2013 were derived from the audited consolidated financial statements of Regal and the notes thereto. The selected historical financial data does not necessarily indicate the operating results or financial position that would have resulted from our operations on a combined basis during the periods presented, nor is the historical data necessarily indicative of any future operating results or financial position of Regal. In addition to the below selected financial data, you should also refer to the more complete financial information included elsewhere in this Form 10-K.

	Fiscal yearendedDecember 31, 2016		Fiscal yearendedDecember 31, 2015		Fiscal yearendedJanuary 1, 2015 (1)		Fiscal yearendedDecember 26, 2013		Fiscal yearendedDecember 27, 2012
	(in millions, except per share data)
Statement of Income Data:
Total revenues	$	3,197.1	$	3,127.3	$	2,990.1	$	3,038.1	$	2,820.0
Income from operations(5)	339.4		319.3		306.4		339.8		330.0
Net income attributable to controlling interest(4)(5)	170.4		153.4		105.6		157.7		142.3
Earnings per diluted share(4)(5)	1.09		0.98		0.68		1.01		0.92
Dividends per common share(2)(3)	$	0.88	$	0.88	$	1.88	$	0.84	$	1.84

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	As of or forthe fiscalyear endedDecember 31, 2016			As of or forthe fiscalyear endedDecember 31, 2015			As of or forthe fiscalyear endedJanuary 1, 2015 (1)			As of or forthe fiscalyear endedDecember 26, 2013			As of or forthe fiscalyear endedDecember 27, 2012
	Fiscal yearendedDecember 31, 2017			Fiscal yearendedDecember 31, 2016			Fiscal yearendedDecember 31, 2015			Fiscal yearendedJanuary 1, 2015 (1)			Fiscal yearendedDecember 26, 2013
	(in millions, except operating data)
	(in millions, except per share data)
Other financial data:
Statement of Income Data:
Net cash provided by operating activities(4)	$	410.5		$	434.4		$	349.1		$	346.9		$	346.6
Total revenues	$	3,163.0		$	3,197.1		$	3,127.3		$	2,990.1		$	3,038.1
Net cash used in investing activities(4)	(223.6		)	(183.3		)	(150.4		)	(258.6		)	(183.4		)
Income from operations(4)(7)	271.7			339.4			319.3			306.4			339.8
Net cash provided by (used in) financing activities(2)(3)	(160.0		)	(178.6		)	(332.5		)	83.1			(306.7		)
Net income attributable to controlling interest(3)(4)(6)(7)	112.3			170.4			153.4			105.6			157.7
Balance sheet data at period end:
Earnings per diluted share(3)(4)(6)(7)	0.72			1.09			0.98			0.68			1.01
Cash and cash equivalents	$	246.5		$	219.6		$	147.1		$	280.9		$	109.5
Dividends per common share(2)	$	0.88		$	0.88		$	0.88		$	1.88		$	0.84
Total assets(6)	2,645.7			2,601.6			2,511.5			2,678.6			2,202.1
Total debt obligations(6)	2,340.1			2,342.4			2,332.2			2,284.6			1,975.2
Deficit	(838.9		)	(877.6		)	(897.3		)	(715.3		)	(750.4		)
Operating data:
Theatre locations	561			572			574			580			540
Screens	7,267			7,361			7,367			7,394			6,880
Average screens per location	13.0			12.9			12.8			12.7			12.7
Attendance (in millions)	210.9			216.7			220.2			228.6			216.4
Average ticket price	$	9.78		$	9.41		$	9.08		$	9.01		$	8.90
Average concessions per patron	$	4.42		$	4.16		$	3.77		$	3.57		$	3.46



	As of or for the fiscal year ended December 31, 2017			As of or for the fiscal year ended December 31, 2016			As of or for the fiscal year ended December 31, 2015			As of or for the fiscal year ended January 1, 2015 (1)			As of or for the fiscal year ended December 26, 2013
	(in millions, except operating data)
Other financial data:
Net cash provided by operating activities(3)(6)	$	409.9		$	410.5		$	434.4		$	349.1		$	346.9
Net cash used in investing activities(3)(6)	(410.6		)	(223.6		)	(183.3		)	(150.4		)	(258.6		)
Net cash provided by (used in) financing activities(2)	(17.0		)	(160.0		)	(178.6		)	(332.5		)	83.1
Balance sheet data at period end:
Cash and cash equivalents	$	228.8		$	246.5		$	219.6		$	147.1		$	280.9
Total assets(5)	2,842.9			2,645.7			2,601.6			2,511.5			2,678.6
Total debt obligations(5)	2,470.3			2,340.1			2,342.4			2,332.2			2,284.6
Deficit	(855.8		)	(838.9		)	(877.6		)	(897.3		)	(715.3		)

_______________________________________________________________________________


(1)	Fiscal year ended January 1, 2015 was comprised of 53 weeks.


(2)	Includes the December 15, 2014 payment of the $1.00 extraordinary cash dividend paid on each share of Class A and Class B common stock.

(3) ~~Includes~~During the ~~December~~quarter 27ended September 26, ~~2012~~2013, ~~payment~~we redeemed 2.3 million of our National CineMedia common units for a like number of shares of NCM, Inc. common stock, which the Company sold in an underwritten public offering (including underwriter over-allotments) for $117.0079 ~~extraordinary~~per ~~cash~~share, ~~dividend~~reducing ~~paid~~our oninvestment ~~each~~in ~~share~~National CineMedia by approximately $10.0 million, the average carrying amount of ~~Class~~the Ashares sold. The Company received approximately $40.9 million in proceeds, resulting in a gain on sale of approximately $30.9 million. We accounted for these transactions as a proportionate decrease in the Company's Initial Investment Tranche and ~~Class~~Additional BInvestments ~~common~~Tranche ~~stock~~and decreased our ownership share in National CineMedia. See Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for further information.

(4) During the ~~quarter~~years ended ~~September~~December 2631, ~~2013~~2017, weDecember ~~redeemed~~31, ~~2.3~~2016, ~~million~~December of31, ~~our~~2015, ~~National~~January ~~CineMedia~~1, ~~common~~2015, ~~units~~and ~~for~~December a26, ~~like~~2013, ~~number~~we ofrecorded ~~shares~~long-lived asset and favorable lease impairment charges of ~~NCM~~$15.0 million, ~~Inc~~$7.9 ~~common~~million, ~~stock~~$15.6 million, ~~which~~$5.6 ~~the~~million, ~~Company~~and ~~sold~~$9.5 inmillion, anrespectively, ~~underwritten~~specific ~~public~~to ~~offering~~theatres ~~(including~~that ~~underwriter~~were ~~over-allotments)~~directly ~~for~~and ~~$17.79~~individually ~~per~~impacted ~~share,~~by ~~reducing~~increased ~~our~~competition, ~~investment~~adverse changes in ~~National~~market ~~CineMedia~~demographics byor ~~approximately~~adverse ~~$10.0~~changes ~~million,~~in the ~~average~~development ~~carrying~~or ~~amount~~the conditions of the ~~shares~~areas ~~sold~~surrounding the theatre. ~~The~~In ~~Company~~addition, ~~received~~during ~~approximately~~the ~~$40.9~~years ~~million~~ended inDecember ~~proceeds~~31, ~~resulting~~2017 inand aDecember ~~gain~~31, on2016, ~~sale~~we ofrecorded ~~approximately~~goodwill impairment charges of $307.93 million. Weand ~~accounted~~$1.7 ~~for~~million, ~~these~~respectively, ~~transactions~~ as ~~a proportionate decrease in~~ the ~~Company's~~carrying ~~Initial~~value ~~Investment~~of ~~Tranche~~one ~~and~~of ~~Additional~~its ~~Investments~~reporting ~~Tranche~~units ~~and~~exceeded ~~decreased~~its ~~our~~estimated ~~ownership~~fair ~~share in National CineMedia~~value. See Note 42 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for further information related to our impairment policies.

(5) ~~During~~In ~~the~~April ~~years ended December 31~~2015, ~~2016,~~the ~~December~~FASB ~~31,~~issued ~~2015,~~ASU ~~January 1,~~ 2015-03, ~~December~~Interest—Imputation ~~26, 2013, and December 27, 2012, we recorded impairment charges~~ of ~~$9.6 million~~Interest, ~~$15.6~~which ~~million,~~intended ~~$5.6 million, $9.5 million, and $11.1 million, respectively, specific~~ to ~~theatres~~simplify ~~that were directly and individually impacted by increased competition, adverse changes in market demographics or adverse changes in~~ the ~~development~~presentation ~~or the conditions~~ of ~~the~~debt ~~areas~~issuance ~~surrounding the theatre~~costs. ~~See~~Prior ~~Note 2~~ to the ~~consolidated~~issuance ~~financial statements included in Part II, Item 8~~ of ~~this~~ASU ~~Form 10~~2015-K03, ~~for~~debt ~~further~~issuance ~~information~~costs ~~related~~were toreported ~~our impairment policies.~~on

(6) In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest, which intended to simplify the presentation of debt issuance costs. Prior to the issuance of ASU 2015-03, debt issuance costs were reported on the balance sheet as assets and amortized as interest expense. ASU 2015-03 requires that they be presented on the balance sheet as a direct deduction from the carrying amount of the related debt liability. The costs will continue to be amortized to interest expense using the effective interest method. ASU 2015-03 is to be applied retrospectively and is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. The Company adopted this guidance during the quarter ended March 31, 2016. Debt issuance costs associated with long-term debt, net of accumulated amortization, were $25.8 million, $30.716

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the balance sheet as assets and amortized as interest expense. ASU 2015-03 requires that they be presented on the balance sheet as a direct deduction from the carrying amount of the related debt liability. The costs will continue to be amortized to interest expense using the effective interest method. ASU 2015-03 is to be applied retrospectively and is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. The Company adopted this guidance during the quarter ended March 31, 2016. Debt issuance costs associated with long-term debt, net of accumulated amortization, were $23.1 million, $2825.08 million, $2630.17 million, $28.0 million, and $2026.01 million as of December 31, 2017, December 31, 2016, December 31, 2015, January 1, 2015, and December 26, 2013, ~~and December 27, 2012,~~ respectively. The balance sheet as of December 31, 2015 has been recast to reflect the reclassification of debt issuances costs, net of accumulated amortization, from "Other Non-Current Assets" to a reduction of "Long-Term Debt, Less Current Portion."

(6)

On August 4, 2017, the Company sold all of its 50% equity interest in Open Road Films, a film distribution company jointly owned by us and AMC, to a third party for total proceeds of approximately $14.0 million. In accordance with the purchase agreement, approximately $3.7 million of the net proceeds received were in satisfaction of various receivables and other amounts due to the Company related to film marketing services provided to Open Road Films prior to the closing date. As a result of the sale, the Company recorded a gain of approximately $17.8 million, representing the difference between the net proceeds received of $10.3 million (after satisfaction of the above amounts due the Company) and the carrying amount of the Company's investment in Open Road Films (approximately $(7.5) million) as of the closing date.


(7)	As discussed in Part I of this Form 10-K, on December 5, 2017, Regal entered into the Merger Agreement and as a result, incurred merger related expenses of approximately $12.5 million during the quarter ended December 31, 2017.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

This discussion summarizes the significant factors affecting the consolidated operating results, financial condition, liquidity and cash flows of Regal Entertainment Group for the fiscal years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016, and ~~January~~December 131, 2015. The following discussion and analysis should be read in conjunction with the consolidated financial statements of Regal and the notes thereto included elsewhere in this Form 10-K. This discussion and analysis does not reflect any changes that may become relevant as a result of the Company’s becoming a wholly owned, indirect subsidiary of Cineworld.

Overview and Basis of Presentation

We conduct our operations through our wholly owned subsidiaries. We operate one of the largest and most geographically diverse theatre circuits in the United States, consisting of 7,~~267~~322 screens in ~~561~~560 theatres in 4243 states along with Guam, Saipan, American Samoa and the District of Columbia as of December 31, ~~2016~~2017. We believe the size, reach and quality of our theatre circuit provide an exceptional platform to realize economies of scale from our theatre operations. The Company manages its business under one reportable segment: theatre exhibition operations.

We generate revenues primarily from admissions and concession sales. Additional revenues are generated by our vendor marketing programs, our gift card and bulk ticket programs, various other activities in our theatres and through our relationship with National CineMedia, which focuses on in-theatre advertising. Film rental costs depend primarily on the popularity and box office revenues of a film, and such film rental costs generally increase as the admissions revenues generated by a film increase. Because we purchase certain concession items, such as fountain drinks and popcorn, in bulk and not pre-packaged for individual servings, we are able to maximize our margins by negotiating volume discounts. Other operating expenses consist primarily of theatre labor and occupancy costs.

~~For~~On aDecember ~~summary~~5, of2017, ~~industry~~the ~~trends~~Company asentered ~~well~~into asthe ~~other~~Merger ~~risks~~Agreement ~~and~~with ~~uncertainties relevant to the Company~~Cineworld, ~~see~~US ~~"Business—Industry~~Holdco ~~Overview~~ and ~~Trends"~~the ~~and "Risk Factors."~~Merger

Sub, pursuant to which the Company became a wholly owned, indirect subsidiary of Cineworld upon the consummation of the Merger on February 28, 2018. At the effective time of the Merger, each outstanding share of the Company’s Class A and Class B common stock were converted into the right to receive $23.00 in cash, subject to the terms and conditions of the Merger Agreement. With respect to the periods subsequent to the periods covered hereby, this discussion and analysis is qualified in all

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respects by the fact that the Company became a wholly owned, indirect subsidiary of Cineworld upon consummation of the Merger on February 28, 2018.

Critical Accounting Estimates

Our consolidated financial statements are prepared in conformity with U.S generally accepted accounting principles ("GAAP"), which require management to make estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosures of contingent assets and liabilities as of the date of the balance sheet as well as the reported amounts of revenues and expenses during the reporting period. We routinely make estimates and judgments about the carrying value of our assets and liabilities that are not readily apparent from other sources. We evaluate and modify on an ongoing basis such estimates and assumptions, which include those related to property and equipment, goodwill, deferred revenue pertaining to gift card and bulk ticket sales, income taxes and purchase accounting as well as others discussed in Note 2 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K. Estimates and assumptions are based on historical and other factors believed to be reasonable under the circumstances. The results of these estimates may form the basis of the carrying value of certain assets and liabilities. Actual results, under conditions and circumstances different from those assumed, may differ materially from estimates. The impact and any associated risks related to estimates, assumptions, and accounting policies are discussed elsewhere within this "Management's Discussion and Analysis of Financial Condition and Results of Operations," as well as in the notes to the consolidated financial statements, if applicable, where such estimates, assumptions, and accounting policies affect our reported and expected results. Management has discussed the development and selection of its critical accounting estimates with the Audit Committee of our Board of Directors and the Audit Committee has reviewed our related disclosures herein.

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We believe the following accounting policies are critical to our business operations and the understanding of our results of operations and affect the more significant judgments and estimates used in the preparation of our consolidated financial statements:

•

We have applied the principles of purchase accounting when recording theatre acquisitions. Under current purchase accounting principles, we are required to use the acquisition method of accounting to estimate the fair value of all assets and liabilities, including: (i) the acquired tangible and intangible assets, including property and equipment, (ii) the liabilities assumed at the date of acquisition (including contingencies), and (iii) the related deferred tax assets and liabilities. Because the estimates we make in purchase accounting can materially impact our future results of operations, for significant acquisitions, we have obtained assistance from third party valuation specialists in order to assist in our determination of fair value. The Company provides assumptions to the third party valuation firms based on information available to us at the acquisition date, including both quantitative and qualitative information about the specified assets or liabilities. The Company primarily utilizes the third parties to accumulate comparative data from multiple sources and assemble a report that summarizes the information obtained. The Company then uses the information to determine fair value. The third party valuation firms are supervised by Company personnel who are knowledgeable about valuations and fair value. The Company evaluates the appropriateness of the valuation methodology utilized by the third party valuation firms. The estimation of the fair value of the assets and liabilities involves a number of judgments and estimates that could differ materially from the actual amounts. Historically, the estimates made have not experienced significant changes and, as a result, we have not disclosed such changes.

• FASB Accounting Standards Codification ("ASC") Subtopic 350-20, Intangibles—Goodwill and Other—Goodwill specifies that goodwill and indefinite-lived intangible assets will be subject to an annual impairment assessment. In assessing the recoverability of the goodwill, we must make various assumptions regarding estimated future cash flows and other factors in determining the fair values of the respective assets. If these estimates or their related assumptions change in the future, we may be required to record impairment charges for these assets in future periods. Our goodwill impairment assessment for fiscal 2017 indicated that the carrying value of one of our reporting units exceeded its estimated fair value and as a result, we recorded a goodwill impairment charge of approximately $7.3 million. Our annual goodwill impairment assessment for fiscal 2016 indicated that the carrying value of one of our reporting units exceeded its estimated fair value and as a result, we recorded a goodwill impairment charge of approximately $1.7 million. Based on our annual impairment assessment conducted during fiscal 2015 ~~and fiscal 2014~~, we were not required to record a charge for goodwill impairment.

• We depreciate and amortize the components of our property and equipment relating to both owned and leased theatres on a straight-line basis over the shorter of the lease term or the estimated useful lives of the assets. Each owned theatre consists of a building structure, structural improvements, seating and concession and film display equipment. While we have assigned an estimated useful life of less than 30 years to certain acquired facilities, we estimate that our newly constructed buildings generally have an estimated useful life of 30 years. Certain of our buildings have been in existence for more than 40 years. With respect to equipment (e.g., concession stand, point-of-sale equipment, etc.), a substantial portion is depreciated over seven years or less, which has been our historical replacement period. Seats and digital projection equipment generally have longer useful economic lives, and their depreciable lives (10-17.5 years) are based on our experience and replacement practices. The estimates of the assets' useful lives require our judgment and our knowledge of the assets being depreciated and amortized. Further, we review the economic useful lives of such assets annually and make adjustments thereto as necessary. To the extent we determine that certain of our assets have become obsolete, we accelerate depreciation over the remaining useful lives of the assets. Actual economic lives may differ materially from these estimates.

Historical appraisals of our properties have supported the estimated lives being used for depreciation and amortization purposes. Furthermore, our analysis of our historical capital replacement program is consistent with our depreciation policies. Finally, we review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. Such analysis generally evaluates assets for impairment on an individual theatre basis. When the estimated future undiscounted cash flows of the operations to which the assets relate do not exceed the carrying value of the assets, such assets are written down to fair value. Our experience indicates that theatre properties become impaired primarily due to market or competitive factors rather than physical (wear and tear) or functional (inadequacy or obsolescence) factors. In this regard, we do not believe the frequency or volume of facilities impaired due to these market factors are significant enough to impact the useful lives used for depreciation periods. During the years ended December 31, 2016, December 31, 2015 and January 1, 2015, we recorded impairment charges of $9.6 million, $15.6 million and $5.6 million, respectively, specific to theatres that were directly and individually impacted by increased competition, adverse changes in market demographics or adverse changes in the development or the conditions of the areas surrounding the theatres we deemed other than temporary.18

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~~For~~of-sale ~~the fiscal years ended December 31~~equipment, ~~2016~~etc.), ~~December 31,~~a ~~2015~~substantial ~~and~~portion ~~January 1,~~is ~~2015,~~depreciated noover ~~significant~~seven ~~changes~~years ~~have~~or ~~been~~less, ~~made~~which tohas ~~the~~been ~~depreciation~~our ~~and~~historical ~~amortization~~replacement ~~rates~~period. ~~applied~~Seats toand ~~operating~~digital ~~assets,~~projection ~~the~~equipment ~~underlying~~generally ~~assumptions~~have ~~related~~longer touseful ~~estimates~~economic oflives, ~~depreciation~~ and ~~amortization,~~their ordepreciable ~~the~~lives ~~methodology applied~~(10-17.5 years) ~~For~~are ~~the~~based ~~fiscal~~on ~~year~~our ~~ended~~experience ~~December 31, 2016, consolidated depreciation~~ and ~~amortization~~replacement ~~expense~~practices. ~~was~~The ~~$230.7~~estimates ~~million,~~of ~~representing~~the ~~7.2%~~assets' ofuseful ~~consolidated~~lives ~~total~~require ~~revenues.~~our Ifjudgment ~~the~~and ~~estimated~~our ~~lives~~knowledge of ~~all~~the assets being depreciated ~~were~~and ~~increased~~amortized. byFurther, ~~one~~we ~~year,~~review the ~~consolidated~~economic ~~depreciation~~useful ~~and~~lives ~~amortization~~of ~~expense~~such ~~would~~assets ~~have~~annually ~~decreased~~and bymake ~~approximately~~adjustments ~~$14.9 million,~~thereto oras 6necessary.~~5%.~~ IfTo the ~~estimated~~extent ~~lives~~we determine that certain of ~~all~~our assets ~~being~~have ~~depreciated~~become ~~were~~obsolete, ~~decreased~~we byaccelerate ~~one~~depreciation ~~year,~~over the ~~consolidated~~remaining ~~depreciation~~useful ~~and~~lives ~~amortization~~of ~~expense~~the ~~would~~assets. Actual ~~have~~economic ~~increased~~lives bymay ~~approximately~~differ ~~$17.1 million,~~materially orfrom 7these estimates.~~4%.~~

Historical appraisals of our properties have supported the estimated lives being used for depreciation and amortization purposes. Furthermore, our analysis of our historical capital replacement program is consistent with our depreciation policies. Finally, we review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. Such analysis generally evaluates assets for impairment on an individual theatre basis. When the estimated future undiscounted cash flows of the operations to which the assets relate do not exceed the carrying value of the assets, such assets are written down to fair value. Our experience indicates that theatre properties become impaired primarily due to market or competitive factors rather than physical (wear and tear) or functional (inadequacy or obsolescence) factors. In this regard, we do not believe the frequency or volume of facilities impaired due to these market factors are significant enough to impact the useful lives used for depreciation periods. During the years ended December 31, 2017, December 31, 2016 and December 31, 2015, we recorded long-lived asset impairment charges of $13.5 million, $7.9 million and $15.6 million, respectively, specific to theatres that were directly and individually impacted by increased competition, adverse changes in market demographics or adverse changes in the development or the conditions of the areas surrounding the theatres we deemed other than temporary.

For the fiscal years ended December 31, 2017, December 31, 2016 and December 31, 2015, no significant changes have been made to the depreciation and amortization rates applied to operating assets, the underlying assumptions related to estimates of depreciation and amortization, or the methodology applied. For the fiscal year ended December 31, 2017, consolidated depreciation and amortization expense was $249.7 million, representing 7.9% of consolidated total revenues. If the estimated lives of all assets being depreciated were increased by one year, the consolidated depreciation and amortization expense would have decreased by approximately $16.6 million, or 6.7%. If the estimated lives of all assets being depreciated were decreased by one year, the consolidated depreciation and amortization expense would have increased by approximately $19.2 million, or 7.7%.

•

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases as well as operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. We record a valuation allowance if it is deemed more likely than not that our deferred income tax assets will not be realized. We reassess the need for such valuation allowance on an ongoing basis. An increase in the valuation allowance generally results in an increase in the provision for income taxes recorded in such period. A decrease in the valuation allowance generally results in a decrease to the provision for income taxes recorded in such period.

Additionally, income tax rules and regulations are subject to interpretation, require judgment by us and may be challenged by the taxing authorities. As described further in Note 7 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, the Company applies the provisions of ASC Subtopic 740-10, Income Taxes—Overview. Although we believe that our tax return positions are fully supportable, in accordance with ASC Subtopic 740-10, we recognize a tax benefit only for tax positions that we determine will more likely than not be sustained based on the technical merits of the tax position. With respect to such tax positions for which recognition of a benefit is appropriate, the benefit is measured at the largest amount of benefit that is greater than 50 ~~percent~~% likely of being realized upon ultimate settlement. Tax positions are evaluated on an ongoing basis as part of our process for determining our provision for income taxes. Among other items deemed relevant by us, the evaluations are based on new legislation, other new technical guidance, judicial proceedings, and our specific circumstances, including the progress of tax audits. Any change in the determination of the amount of tax benefit recognized relative to an uncertain tax position impacts the provision for income taxes in the period that such determination is made.

For fiscal ~~2016~~2017, our provision for income taxes was $~~111~~101.26 million. Changes in management's estimates and assumptions regarding the probability that certain tax return positions will be sustained, the enacted tax rate applied to deferred tax assets and liabilities, the ability to realize the value of deferred tax assets, or the timing of the reversal of tax basis differences could impact the provision for income taxes and change the effective tax rate. A one percentage point change in the effective tax rate from 39.5% to 40.5% would have increased the current year income tax provision by approximately $2.9 million.

• As noted in our significant accounting policies for "Revenue Recognition" under Note 2 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, the Company maintains a deferred revenue balance pertaining to cash received from the sale of bulk tickets and gift cards that have not been redeemed. The Company recognizes revenue associated with bulk tickets and gift cards when redeemed, or when the likelihood of redemption becomes remote. We recognize unredeemed gift cards and other advanced sale-type certificates as revenue (known as "breakage" in our industry) based on historical experience, when the likelihood of redemption is remote, and when there is no legal obligation to remit the unredeemed gift card and bulk ticket items to the relevant jurisdiction. The determination of the likelihood of redemption is based on an analysis of historical redemption trends and considers various factors including the period outstanding, the level and frequency of activity, and the period of inactivity.19

Significant Events and Fiscal 2017 Outlook

During the Fiscal 2016 Period, the fiscal year ended December 31, 2015 ("Fiscal 2015 Period") and the fifty-three week fiscal year ended January 1, 2015 ("Fiscal 2014 Period"), the Company entered into various investing and financing transactions which are more fully described under "Liquidity and Capital Resources" below and in the notes to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

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~~During~~applied ~~the~~to ~~Fiscal~~deferred ~~2016~~tax ~~Period~~assets and liabilities, wethe ~~continued~~ability to ~~make~~realize ~~progress~~the ~~with~~value ~~respect~~of deferred tax assets, or the timing of the reversal of tax basis differences could impact the provision for income taxes and change the effective tax rate. A one percentage point change in the effective tax rate from 47.5% to ~~our~~48.5% ~~business~~would ~~strategy~~have asincreased ~~follows:~~the current year income tax provision by approximately $2.1 million.

• WeAs ~~demonstrated~~noted in our ~~commitment~~significant toaccounting ~~providing~~policies ~~incremental~~for ~~value~~"Revenue toRecognition" ~~our~~under ~~stockholders.~~Note ~~During~~2 to the ~~Fiscal~~consolidated ~~2016~~financial ~~Period~~statements included in Part II, weItem ~~paid~~8 toof ~~our~~this ~~stockholders~~Form ~~four~~10-K, ~~quarterly~~the Company maintains a deferred revenue balance pertaining to cash ~~dividends~~received from the sale of $0bulk tickets and gift cards that have not been redeemed.22 ~~per~~The ~~share~~Company recognizes revenue associated with bulk tickets and gift cards when redeemed, or ~~approximately~~when ~~$138~~the likelihood of redemption becomes remote.9 ~~million~~We recognize unredeemed gift cards and other advanced sale-type certificates as revenue (known as "breakage" in our industry) based on historical experience, when the ~~aggregate~~likelihood of redemption is remote, and when there is no legal obligation to remit the unredeemed gift card and bulk ticket items to the relevant jurisdiction. The determination of the likelihood of redemption is based on an analysis of historical redemption trends and considers various factors including the period outstanding, the level and frequency of activity, and the period of inactivity.

• We continued to actively manage our asset base during the Fiscal 2016 Period by opening two theatres with 19 screens, reopening five screens at an existing theatre and closing 13 theatres and 118 screens, ending the Fiscal 2016 Period with 561 theatres and 7,267 screens.

• We continued to embrace innovative concepts that generate incremental revenue and cash flows for the Company and deliver a premium movie-going experience for our customers on several complementary fronts:

◦First, we continued to improve customer amenities, primarily through the installation of luxury reclining seats. With respect to our luxury reclining seating initiative, as of December 31, 2016, we offered luxury reclining seating in 1,369 auditoriums at 113 theatre locations. We expect to install luxury reclining seating in approximately 40-45 locations during 2017 and expect to outfit approximately 45% of the total screens in our circuit by the end of 2019. The costs of these conversions in some cases are partially covered by contributions from our theatre landlords.

◦Second, to address consumer trends and customer preferences, we have continued to expand our menu of food and alcoholic beverage products to an increasing number of attendees. The enhancement of our food and alcoholic beverage offerings has had a positive effect on our operating results, and we expect to continue to invest in such offerings in our theatres. As of December 31, 2016, we offered an expanded menu of food in 216 locations (reaching approximately 53% of our fiscal 2016 attendees) and alcoholic beverages in 143 locations (reaching approximately 28% of our fiscal 2016 attendees), and we expect to offer an expanded menu of food in approximately 270 locations and alcoholic beverages in approximately 215 locations by the end of 2017.

◦Third, we continued to implement various customer engagement initiatives aimed at delivering a premium movie-going experience for our customers in order to better compete for patrons and build brand loyalty. For example, we maintain a frequent moviegoer loyalty program, named the Regal Crown Club®, to actively engage our core customers. During the first quarter of 2016, we completed the national rollout of the new Regal Crown Club®. Members of the enhanced program can earn unlimited credits and can redeem such credits for movie tickets, concession items and movie memorabilia at the theatre or in an online reward center where members can select the rewards of their choice. We believe these changes allow us to offer more relevant offers to our members and increase customer engagement in the program. As of December 31, 2016, we had approximately 11.8 million active members in the Regal Crown Club®, making it the largest loyalty program in our industry.

◦In addition, we continued to develop and enhance other customer engagement initiatives such as mobile ticketing applications, internet ticketing, social media and other marketing initiatives. For example, we have improved the customer experience of purchasing tickets by expanding our ability to sell tickets remotely via our mobile application and through our internet ticketing partners such as Fandango.com and Atom Tickets. Customers can choose their preferred ticketing option, which in many cases means they can pre-purchase tickets, scan their mobile device and proceed directly to their reserved seat without waiting in line. In addition to providing customers the ability to pre-purchase tickets, our mobile application provides customers the ability to find films, movie information, showtimes, track Regal Crown Club® credits and receive special offers from Regal. Finally, at nearly one third of our locations, our newest ticketing partner, Atom Tickets, provides our patrons the ability to bypass concession stand lines by pre-purchasing concession items via their mobile device. We believe these technologies provide a platform for delivering a quality customer experience and will drive incremental revenues and cash flows in a more cost-effective manner.

◦Finally, our IMAX® digital projection systems and our proprietary large screen format, RPXSM, offer our patrons all-digital, large format premium experiences and generate incremental revenue and cash flows for the Company. As of December 31, 2016, our IMAX® footprint consisted of 89 IMAX® screens, and we operated 93 RPXSM screens. We continue to selectively install RPXSM screens where we can generate a financial return, and we have recently agreed to install an additional 11 IMAX® digital projection systems, which will ultimately expand our IMAX® footprint to 100 screens.

We are optimistic regarding the breadth of the 2017 film slate, including the timing of the release schedule and the number of films scheduled for release. Evidenced by the motion picture studios' continued efforts to promote and market

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upcoming film releases, 2017 appears to be another year of high-profile releases such as The Lego Batman Movie, Beauty and the Beast, Fast and Furious 8, Guardians of the Galaxy Volume 2, Pirates of the Caribbean: Dead Men Tell No Tales, Wonder Woman, Cars 3, Transformers: The Last Knight, Despicable Me 3, Spider-Man: Homecoming, War of the Planet of the Apes, Thor: Ragnarok, Justice League, Coco, Star Wars: The Last Jedi and Pitch Perfect 3.

We intend to grow our theatre circuit through selective expansion and through accretive acquisitions. With respect to capital expenditures, subject to the timing of certain construction projects, we expect capital expenditures (net of proceeds from asset sales and landlord contributions) to be in the range of $130.0 million to $145.0 million for fiscal 2017, consisting of upgrades for premium amenities, new theatre development, and maintenance.

Overall for fiscal 2017, we expect to benefit from modest increases in ticket prices and average concessions per patron. In addition, we expect fiscal 2017 admissions and concessions revenues to be supported by our continued focus on efficient theatre operations and through opportunities to expand our concession offerings and customer engagement initiatives. We will continue to maintain a business strategy focused on the evaluation of accretive acquisition opportunities, selective upgrades and premium experience opportunities and providing incremental returns to our stockholders. For an understanding of the significant factors that influenced our performance during the past three fiscal years, the preceding and following discussion should be read in conjunction with the consolidated financial statements and the notes thereto presented in Part II, Item 8 of this Form 10-K.

Recent Developments

On February 9, 2017, the Company declared a cash dividend of $0.22 per share on each share of the Company's Class A and Class B common stock (including outstanding restricted stock), payable on March 15, 2017 to stockholders of record on March 3, 2017.

Results of Operations

Based on our review of industry sources, North American box office revenues for the time period that corresponds to the Fiscal ~~2016~~2017 Period were estimated to have ~~increased~~decreased by approximately ~~one~~two to three percent per screen in comparison to the Fiscal ~~2015~~2016 Period. The industry's box office results for fiscal ~~2016~~2017 were ~~positively~~negatively impacted by ~~strong~~weaker ~~attendance~~than ~~from~~expected ~~the~~attendance ~~breadth~~generated ~~and~~by ~~commercial success of~~ the overall film slate during the year.

The ~~For~~following ~~fiscal~~table ~~2014~~sets ~~and~~forth ~~prior periods,~~ the ~~Company's~~percentage ~~fiscal~~of ~~year~~total ~~ended~~revenues onrepresented ~~the~~by ~~first~~certain ~~Thursday~~items ~~after~~included ~~December 25, which~~ in ~~certain~~our ~~years~~consolidated ~~(such~~statements asof ~~fiscal~~income ~~2014)~~for ~~resulted~~the inFiscal a2017 ~~53-week~~Period, ~~fiscal~~the ~~year.~~Fiscal ~~Beginning~~2016 ~~January~~Period 2,and ~~2015,~~ the ~~Company's fiscal~~ year ~~changed~~ended ~~from~~December a31, ~~52-53~~2015 ~~week fiscal year ending on~~ (the ~~first~~"Fiscal ~~Thursday~~2015 ~~after~~Period") ~~December~~(dollars 25and ofattendance ~~each~~in ~~year~~millions, toexcept aaverage ~~fiscal~~ticket ~~year~~prices ~~ending~~and onaverage ~~December~~concessions 31per ~~of each year.~~ patron):

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The following table sets forth the percentage of total revenues represented by certain items included in our consolidated statements of income for the Fiscal 2016 Period, the Fiscal 2015 Period and the Fiscal 2014 Period (dollars and attendance in millions, except average ticket prices and average concessions per patron):



	Fiscal 2017 Period					Fiscal 2016 Period					Fiscal 2015 Period
	$			% of Revenue		$			% of Revenue		$			% of Revenue
Revenues:
Admissions	$	2,008.1		63.5	%	$	2,061.7		64.5	%	$	2,038.2		65.2	%
Concessions	930.2			29.4		932.6			29.2		901.7			28.8
Other operating revenues	224.7			7.1		202.8			6.3		187.4			6.0
Total revenues	3,163.0			100.0		3,197.1			100.0		3,127.3			100.0
Operating expenses:
Film rental and advertising costs(1)	1,067.8			53.2		1,107.3			53.7		1,093.1			53.6
Cost of concessions(2)	123.8			13.3		119.5			12.8		114.4			12.7
Rent expense(3)	426.8			13.5		427.6			13.4		421.5			13.5
Other operating expenses(3)	912.6			28.9		883.2			27.6		863.7			27.6
General and administrative expenses (including share-based compensation expense of $9.2 million, $8.8 million and $8.3 million for the Fiscal 2017 Period, the Fiscal 2016 Period and the Fiscal 2015 Period, respectively)(3)	86.6			2.7		84.6			2.6		78.8			2.5
Depreciation and amortization(3)	249.7			7.9		230.7			7.2		216.8			6.9
Net loss on disposal and impairment of operating assets and other(3)	24.0			0.8		4.8			0.2		19.7			0.6
Total operating expenses(3)	2,891.3			91.4		2,857.7			89.4		2,808.0			89.8
Income from operations(3)	271.7			8.6		339.4			10.6		319.3			10.2
Interest expense, net(3)	125.1			4.0		128.1			4.0		129.6			4.1
Loss on extinguishment of debt(3)	1.3			—		2.9			0.1		5.7			0.2
Earnings recognized from NCM(3)	(24.1		)	0.8		(29.4		)	0.9		(31.0		)	1.0
Gain on sale of Open Road Films Investment(3)	(17.8		)	0.6		—			—		—			—
Equity in income of non-consolidated entities and other, net(3)	(39.2		)	1.2		(43.9		)	1.4		(38.3		)	1.2
Merger related expenses(3)	12.5			0.4		—			—		—			—
Provision for income taxes(3)	101.6			3.2		111.2			3.5		100.1			3.2
Net income attributable to controlling interest(3)	$	112.3		3.6		$	170.4		5.3		$	153.4		4.9
Attendance	196.9			*		210.9			*		216.7			*
Average ticket price(4)	$	10.20		*		$	9.78		*		$	9.41		*
Average concessions per patron(5)	$	4.72		*		$	4.42		*		$	4.16		*

	Fiscal 2016 Period					Fiscal 2015 Period					Fiscal 2014 Period
	$			% ofRevenue		$			% ofRevenue		$			% ofRevenue
Revenues:
Admissions	$	2,061.7		64.5	%	$	2,038.2		65.2	%	$	1,998.9		66.9	%
Concessions	932.6			29.2		901.7			28.8		829.6			27.7
Other operating revenues	202.8			6.3		187.4			6.0		161.6			5.4
Total revenues	3,197.1			100.0		3,127.3			100.0		2,990.1			100.0
Operating expenses:
Film rental and advertising costs(1)	1,107.3			53.7		1,093.1			53.6		1,047.1			52.4
Cost of concessions(2)	119.5			12.8		114.4			12.7		111.1			13.4
Rent expense(3)	427.6			13.4		421.5			13.5		423.4			14.2
Other operating expenses(3)	883.2			27.6		863.7			27.6		813.2			27.2
General and administrative expenses (including share-based compensation expense of $8.8 million, $8.3 million and $9.4 million for the Fiscal 2016 Period, the Fiscal 2015 Period and the Fiscal 2014 Period, respectively)(3)	84.6			2.6		78.8			2.5		74.4			2.5
Depreciation and amortization(3)	230.7			7.2		216.8			6.9		207.2			6.9
Net loss on disposal and impairment of operating assets and other(3)	4.8			0.2		19.7			0.6		7.3			0.2
Total operating expenses(3)	2,857.7			89.4		2,808.0			89.8		2,683.7			89.8
Income from operations(3)	339.4			10.6		319.3			10.2		306.4			10.2
Interest expense, net(3)	128.1			4.0		129.6			4.1		126.5			4.2
Loss on extinguishment of debt(3)	2.9			0.1		5.7			0.2		62.4			2.1
Earnings recognized from NCM(3)	(29.4		)	0.9		(31.0		)	1.0		(32.1		)	1.1
Provision for income taxes(3)	111.2			3.5		100.1			3.2		73.4			2.5
Net income attributable to controlling interest(3)	$	170.4		5.3		$	153.4		4.9		$	105.6		3.5
Attendance	210.9			*		216.7			*		220.2			*
Average ticket price(4)	$	9.78		*		$	9.41		*		$	9.08		*
Average concessions per patron(5)	$	4.42		*		$	4.16		*		$	3.77		*

_______________________________________________________________________________


*	Not meaningful


(1)	Percentage of revenues calculated as a percentage of admissions revenues.


(2)	Percentage of revenues calculated as a percentage of concessions revenues.


(3)	Percentage of revenues calculated as a percentage of total revenues.


(4)	Calculated as admissions revenues/attendance.


(5)	Calculated as concessions revenues/attendance.

Fiscal ~~2016~~2017 Period Compared to Fiscal ~~2015~~2016 Period

Admissions

During the Fiscal ~~2016~~2017 Period, total admissions revenues ~~increased~~decreased $2353.56 million, or 1.2.6%, to $2,~~061~~008.71 million, from $2,~~038~~061.27 million in the Fiscal ~~2015~~2016 Period. A 36.96% decrease in attendance (approximately $136.1 million of total admissions revenues), partially offset by a 4.3% increase in average ticket prices (approximately $7882.5 million of total admissions

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~~admissions~~ revenues), ~~partially~~led ~~offset~~to bythe aoverall ~~2.7%~~ decrease in ~~attendance~~the ~~(approximately~~Fiscal ~~$55.0~~2017 ~~million~~Period ~~of total~~ admissions revenues). ~~led~~Attendance toduring the ~~overall~~Fiscal ~~increase~~2017 Period in comparison to that of the Fiscal 2016 Period ~~admissions~~was ~~revenues.~~negatively impacted by the weaker overall film slate during the Fiscal 2017 Period. For the Fiscal ~~2016~~2017 Period, the 34.93% average ticket price increase was due to selective price increases identified during our ongoing periodic pricing reviews (particularly at locations featuring luxury reclining seats), partially offset by a decrease in the percentage of our admissions revenues generated by premium format films exhibited during the Fiscal ~~2016~~2017 Period. The decrease in attendance during the Fiscal 2016 Period was primarily attributable to the strong attendance generated by the commercial appeal of the top tier films exhibited during the Fiscal 2015 Period including, most notably, Star Wars: The Force Awakens and Jurassic World. Based on our review of certain industry sources, the ~~increase~~decrease in our admissions revenues on a per screen basis was slightly ~~ahead~~greater ofthan the industry’s per screen results for the Fiscal ~~2016~~2017 Period as compared to the Fiscal ~~2015~~2016 Period. We are optimistic that the industry's investment in new theatres and customer amenities and other recent industry initiatives and trends will drive continued growth and strength for the domestic motion picture industry. To that end, our market share may be positively or negatively impacted by such initiatives and trends during any given quarter.

Concessions

Total concessions revenues ~~increased~~decreased $302.94 million, or 30.43%, to $~~932~~930.62 million during the Fiscal ~~2016~~2017 Period, from $~~901~~932.76 million for the Fiscal ~~2015~~2016 Period. A 6.36% ~~increase~~decrease in ~~average~~attendance ~~concessions revenues per patron~~ (approximately $5561.26 million of total concessions revenues), partially offset by a 26.78% ~~decrease~~increase in ~~attendance~~average concessions revenues per patron (approximately $2459.32 million of total concessions revenues) led to the overall ~~increase~~decrease in the Fiscal ~~2016~~2017 Period concessions revenues. The 6.38% increase in average concessions revenues per patron for the Fiscal ~~2016~~2017 Period was primarily attributable to an increase in beverage, ~~popcorn,~~ and ~~candy~~popcorn sales, selective price increases and the continued rollout of our expanded food and alcohol menu.

Other Operating Revenues

Other operating revenues increased $1521.49 million, or 810.28%, to $~~202~~224.87 million during the Fiscal ~~2016~~2017 Period, from $~~187~~202.48 million for the Fiscal ~~2015~~2016 Period. Included in other operating revenues are revenues from our vendor marketing programs, other theatre revenues (consisting primarily of internet ticketing surcharges, theatre rentals and arcade games), theatre access fees paid by National CineMedia (net of payments for ~~onscreen~~on-screen advertising time provided to our beverage concessionaire) and revenues related to our gift card and bulk ticket programs. ~~During~~The increase in other operating revenues during the Fiscal ~~2016~~2017 Period, ~~the~~was due to an increase in ~~other~~internet ~~operating~~ticketing ~~revenues~~surcharges ~~was~~(approximately ~~primarily~~$13.6 ~~due~~million), to an increase in revenues ~~related~~from to our ~~gift~~vendor ~~card~~marketing programs (approximately $9.4 million) and ~~bulk~~incremental ~~ticket~~National ~~programs~~CineMedia revenues (approximately $101.25 million), ~~and~~partially anoffset ~~increase~~by a decrease in revenues related to ~~internet~~our ~~ticketing~~gift ~~surcharges~~card and bulk ticket programs (approximately $34.92 million).

Film Rental and Advertising Costs

Film rental and advertising costs as a percentage of admissions revenues ~~was~~decreased to 53.72% during the Fiscal 2017 Period from 53.7% in the Fiscal 2016 Period. The decrease in film rental and ~~was~~advertising ~~consistent~~costs ~~with~~as ~~that~~a percentage of admissions revenues was primarily attributable to weaker than expected attendance generated by the top tier films exhibited during the Fiscal ~~2015~~2017 Period.

Cost of Concessions

During the Fiscal ~~2016~~2017 Period, cost of concessions increased $54.13 million, or 43.56%, to $~~119~~123.58 million as compared to $~~114~~119.45 million during the Fiscal ~~2015~~2016 Period. Cost of concessions as a percentage of concessions revenues for the Fiscal ~~2016~~2017 Period was approximately 13.3% compared to 12.8% ~~and~~during ~~was~~the Fiscal 2016 Period. The increase in ~~line~~cost ~~with~~of ~~that~~concessions as a percentage of concessions revenues during the Fiscal ~~2015~~2017 Period was primarily related to increases in packaged goods and raw material costs and the impact of incremental expanded food and alcohol sales during such periods, partially offset by selective price increases during such periods.

Rent Expense

Rent expense ~~increased~~decreased $60.18 million, or 10.42%, to $~~427~~426.68 million in the Fiscal ~~2016~~2017 Period, from $~~421~~427.56 million in the Fiscal ~~2015~~2016 Period. The ~~increase~~decrease in rent expense in the Fiscal ~~2016~~2017 Period was primarily ~~impacted~~attributed byto ~~incremental rent associated with~~ the ~~opening~~permanent closure of ~~two~~ten ~~new~~ theatres with 1988 screens subsequent to the end of the Fiscal ~~2015~~2016 Period, ~~and~~along ~~higher~~with reductions of contingent rent, ~~associated~~partially ~~with~~offset by incremental rent from the ~~increase~~opening inof ~~total~~two ~~revenues,~~new ~~partially~~theatres ~~offset~~with by26 screens and the ~~closure~~acquisition of 13nine theatres with ~~118~~134 screens subsequent to the end of the Fiscal ~~2015~~2016 Period.

Other Operating Expenses

Other operating expenses increased $1929.54 million, or 23.3%, to $~~883~~912.26 million in the Fiscal ~~2016~~2017 Period, from $~~863~~883.72 million in the Fiscal ~~2015~~2016 Period. ~~During~~The increase in other operating expenses during the Fiscal ~~2016~~2017 Period, ~~the~~was primarily due to an increase in other operating expenses ~~was~~from ~~primarily~~the ~~attributable~~Fiscal to2017 Period acquisitions (approximately $17.7 million), increases in ~~theatre~~non-rent occupancy and other costs (approximately $13.8 million) and increased theatre-level payroll and benefit costs (approximately $2.6 million), partially offset by decreased costs associated with lower premium format film revenues (approximately $4.7 million) during the Fiscal 2017 Period.

General and Administrative Expenses

General and administrative expenses increased $52.80 million, or 72.4%, to $8486.6 million in the Fiscal ~~2016~~2017 Period, from $7884.86 million in the Fiscal ~~2015~~2016 Period. The increase in general and administrative expenses during the Fiscal ~~2016~~2017 Period was ~~primarily attributable to higher legal and professional fees.~~

~~Depreciation and Amortization~~22

Depreciation and amortization expense increased $13.9 million, or 6.4%, to $230.7 million for the Fiscal 2016 Period, from $216.8 million in the Fiscal 2015 Period. The increase in depreciation and amortization expense during the Fiscal 2016

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~~Period was~~ primarily ~~related~~attributable to ~~the~~expenses ~~impact of increased capital expenditures~~ associated with the ~~installation~~Santikos ofTheaters, ~~luxury~~Inc. ~~reclining~~and ~~seats~~Warren ~~subsequent~~Theatres toacquisitions ~~the~~described ~~Fiscal~~in ~~2015~~Note ~~Period,~~3 ~~and~~ to ~~a lesser extent,~~ the ~~opening~~consolidated offinancial ~~two~~statements ~~new~~included ~~theatres~~in ~~with~~Part 19II, ~~screens~~Item ~~(partially~~8 ~~offset by the closure~~ of 13this ~~theatres~~Form ~~with 118 screens) subsequent to the end of the Fiscal 2015 Period~~10-K.

Depreciation and Amortization

Depreciation and amortization expense increased $19.0 million, or 8.2%, to $249.7 million for the Fiscal 2017 Period, from $230.7 million in the Fiscal 2016 Period. The increase in depreciation and amortization expense during the Fiscal 2017 Period was primarily related to incremental depreciation and amortization expense associated with increased capital expenditures related to the installation of luxury reclining seats, the acquisition of nine theatres with 134 screens and the opening of two new theatres with 26 screens subsequent to the end of the Fiscal 2016 Period, and accelerated depreciation on certain identified assets, partially offset by permanent closure of 10 theatres with 88 screens subsequent to the end of the Fiscal 2016 Period.

Net Loss on Disposal and Impairment of Operating Assets and Other

Net loss on disposal and impairment of operating assets and other ~~decreased~~increased $1419.92 million, to $424.80 million for the Fiscal ~~2016~~2017 Period, from $194.78 million in the Fiscal ~~2015~~2016 Period. Included in net loss on disposal and impairment of operating assets and other during the Fiscal 2017 Period was a $913.85 million ~~gain~~impairment onof ~~the~~long-lived ~~early~~assets, ~~termination~~a $7.3 million impairment of goodwill related to one of the Company's reporting units, and a ~~theatre~~$1.4 million favorable lease ~~during~~impairment ~~the~~charge ~~Fiscal~~related ~~2016~~to ~~Period~~a theatre scheduled to be closed.

Interest Expense, net

During the Fiscal ~~2016~~2017 Period, net interest expense decreased $13.50 million, or 1.2.3%, to $~~128~~125.1 million, from $~~129~~128.61 million in the Fiscal ~~2015~~2016 Period. The decrease in net interest expense during the Fiscal ~~2016~~2017 Period was primarily due to ~~interest~~the ~~savings~~impact ~~associated~~of ~~with~~ a lower effective interest rate under the Amended Senior Credit Facility during such periods, partially offset by additional interest expense attributable to incremental borrowings under the Amended Senior Credit Facility in connection with the June 2017 Refinancing Agreement.

Loss on Extinguishment of Debt

~~During~~ As described more fully in Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, during the Fiscal ~~2016~~2017 Period, the Company recorded ana ~~aggregate~~ loss on debt extinguishment of ~~approximately~~ $21.93 million in connection with the June ~~2016~~2017 ~~refinancing~~Refinancing ~~and~~Agreement. During ~~December~~the Fiscal 2016 ~~refinancing~~Period, ofthe ~~our~~Company ~~Amended~~recorded ~~Senior~~an ~~Credit~~aggregate ~~Facility~~loss ason ~~further~~debt ~~described~~extinguishment inof ~~Note~~approximately 5$2.9 tomillion ~~the~~in ~~consolidated~~connection ~~financial~~with ~~statements~~the ~~included~~June in2016 ~~Part~~refinancing ~~II,~~and ~~Item~~December 82016 refinancing of ~~this~~our ~~Form~~Amended ~~10-K~~Senior Credit Facility.

Gain on Sale of Open Road Films Investment

As described more fully in Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, during the quarter ended September 30, 2017, the Company recorded a gain on the sale of its investment in Open Road Films of $17.8 million.

Earnings Recognized from NCM

Earnings recognized from NCM decreased $15.63 million, or 518.20%, to $2924.41 million in the Fiscal ~~2016~~2017 Period, from $3129.04 million in the Fiscal ~~2015~~2016 Period. The decrease in earnings recognized from ~~NCM~~National CineMedia during the Fiscal ~~2016~~2017 Period was primarily attributable to lower ~~cash~~equity ~~distributions~~income (including a $5.6 million change in interest loss as described further in Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K) from National CineMedia, partially offset by ~~higher~~an ~~equity~~increase ~~income~~in cash distributions from National CineMedia during the Fiscal 2017 Period as compared to that of the Fiscal 2016 Period.

Merger Related Expenses

As discussed in Part I of this Form 10-K, on December 5, 2017, Regal entered into the Merger Agreement and as a result, incurred merger related expenses of approximately $12.5 million during the year ended December 31, 2017.

Income Taxes

The provision for income taxes of $~~111~~101.26 million and $~~100~~111.12 million for the Fiscal ~~2016~~2017 Period and the Fiscal ~~2015~~2016 Period, respectively, reflect effective tax rates of approximately 47.5% and 39.5%, respectively. The increase in the effective tax rate for the Fiscal 2017 Period is primarily attributable to the remeasurement of deferred tax assets and liabilities resulting from the U.S. Tax Cuts and Jobs Act, the nondeductible goodwill impairment charge of approximately $7.3 million described further in Note 2 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, and nondeductible merger related expenses. The effective tax rates for such periods reflect the impact of certain other non-deductible expenses and other income tax credits.

~~Fiscal 2015 Period Compared to Fiscal 2014 Period~~23

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Fiscal 2016 Period Compared to Fiscal 2015 Period

Admissions

During the Fiscal ~~2015~~2016 Period, total admissions revenues increased $3923.35 million, or 21.02%, to $2,~~038~~061.27 million, from $12,~~998~~038.92 million in the Fiscal ~~2014~~2015 Period. A 3.69% increase in average ticket prices (approximately $7178.35 million of total admissions revenues), partially offset by a 12.67% decrease in attendance (approximately $3255.0 million of total admissions revenues) led to the overall increase in the Fiscal ~~2015~~2016 Period admissions revenues. For the Fiscal ~~2015~~2016 Period, the 3.69% average ticket price increase was due to selective price increases identified during our ongoing periodic pricing reviews ~~and~~(particularly anat ~~increase~~locations featuring luxury reclining seats), partially offset by a decrease in the percentage of our admissions revenues generated by premium format films exhibited during the Fiscal ~~2015~~2016 Period. The decrease in attendance during the Fiscal ~~2015~~2016 Period ~~as compared to the Fiscal 2014 Period~~ was primarily ~~related~~attributable to the ~~timing~~strong ofattendance ~~our~~generated ~~fiscal~~by ~~calendar. The Fiscal 2014 Period included seven additional days of operations in comparison to that of~~ the ~~Fiscal~~commercial ~~2015~~appeal ~~Period. The seven days~~ of ~~operations were significant in that they accounted for approximately 9.1 million attendees, or 4.1%, of~~ the ~~Fiscal~~top ~~2014~~tier ~~Period~~films ~~total~~exhibited ~~attendance~~during ~~and contributed approximately $80.1 million, or 4.0%, of~~ the Fiscal ~~2014~~2015 Period total admissions revenues. Notwithstanding the timing of our fiscal calendar, the Company's box office results for 2015 were positively impacted by strong attendance from the breadth and commercial success of the overall film slate during 2015 including, most notably, Star Wars: The Force Awakens and Jurassic World. Based on our review of certain industry sources, the increase in our admissions revenues on a per screen basis was inslightly ~~line~~ahead ~~with~~of the industry’s per screen results for the Fiscal ~~2015~~2016 Period as compared to the Fiscal ~~2014~~2015 Period.

Concessions

Total concessions revenues increased $7230.19 million, or 83.74%, to $~~901~~932.76 million during the Fiscal ~~2015~~2016 Period, from $~~829~~901.67 million for the Fiscal ~~2014~~2015 Period. A 106.3% increase in average concessions revenues per patron (approximately $8555.42 million of total concessions revenues), partially offset by a 12.67% decrease in attendance (approximately $1324.3 million of total concessions revenues) led to the overall increase in the Fiscal ~~2015~~2016 Period concessions ~~revenue~~revenues. The ~~decrease~~6.3% increase in ~~attendance~~average ~~during~~concessions revenues per patron for the Fiscal ~~2015~~2016 Period was primarily ~~related~~attributable to ~~the~~an ~~timing~~increase ofin ~~our~~beverage, ~~fiscal~~popcorn, ~~calendar~~and ~~described~~candy ~~above.~~sales, ~~Attendance~~selective ~~for~~price ~~the~~increases ~~seven~~and ~~additional days of operations during~~ the ~~Fiscal~~continued ~~2014~~rollout ~~Period contributed approximately $32.1 million, or 3.9%,~~ of ~~the~~our ~~Fiscal~~expanded ~~2014~~food ~~Period~~and ~~total~~alcohol ~~concessions revenues~~menu. ~~The~~ ~~increase in average concessions revenues per patron for the Fiscal 2015~~

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Period was primarily attributable to an increase in popcorn and beverage sales volume, selective price increases and the continued rollout of our expanded food and alcohol menu.

Other Operating Revenues

Other operating revenues increased $2515.84 million, or 168.02%, to $~~187~~202.48 million during the Fiscal ~~2015~~2016 Period, from $~~161~~187.64 million for the Fiscal ~~2014~~2015 Period. ~~During~~ ~~the~~Included ~~Fiscal~~in ~~2015~~other ~~Period,~~operating ~~the~~revenues ~~increase~~are inrevenues from our vendor marketing programs, other ~~operating~~theatre revenues ~~was~~(consisting ~~due~~primarily of internet ticketing surcharges, theatre rentals and arcade games), theatre access fees paid by National CineMedia (net of payments for onscreen advertising time provided to anour ~~increase~~beverage inconcessionaire) and revenues related to our gift card and bulk ticket programs. ~~(approximately~~During ~~$10.2~~the ~~million)~~Fiscal 2016 Period, anthe increase in other ~~theatre~~operating revenues ~~(approximately~~was ~~$8.1 million)~~ primarily ~~related~~due to ~~internet ticketing surcharges,~~ an increase in revenues ~~from~~related to our ~~vendor~~gift ~~marketing~~card and bulk ticket programs (approximately $310.82 million) and ~~incremental~~an ~~National~~increase ~~CineMedia~~in revenues related to internet ticketing surcharges (approximately $3.69 million).

Film Rental and Advertising Costs

Film rental and advertising costs as a percentage of admissions revenues ~~for~~was ~~the Fiscal 2015 Period increased to~~ 53.67% during the Fiscal ~~2015~~2016 Period ~~from 52.4% in the Fiscal 2014 Period. The increase in film rental~~ and ~~advertising costs as a percentage of box office revenues during the Fiscal 2015 Period~~ was ~~primarily~~consistent ~~attributable to higher film costs associated~~ with ~~the~~that ~~success~~ of the ~~top tier films exhibited during the~~ Fiscal 2015 Period.

Cost of Concessions

During the Fiscal ~~2015~~2016 Period, cost of concessions increased $35.31 million, or 34.05%, to $~~114~~119.45 million as compared to $~~111~~114.14 million during the Fiscal ~~2014~~2015 Period. Cost of concessions as a percentage of concessions revenues for the Fiscal ~~2015~~2016 Period was approximately 12.78%, ~~compared~~and towas ~~13.4% during the Fiscal 2014 Period. The decrease~~ in ~~cost~~line ofwith ~~concessions~~that ~~as a percentage~~ of ~~concessions revenues during~~ the Fiscal 2015 Period was primarily due to the amount of vendor marketing revenues recorded as a reduction of cost of concessions and the impact of the aforementioned price increases during such periods, partially offset by slightly higher raw material and packaged good costs for certain items and the related mix of concession products sold.

Rent Expense

Rent expense ~~decreased~~increased $16.91 million, or 01.4%, to $~~421~~427.56 million in the Fiscal ~~2015~~2016 Period, from $~~423~~421.45 million in the Fiscal ~~2014~~2015 Period. The ~~decrease~~increase in rent expense in the Fiscal ~~2015~~2016 Period was primarily impacted by ~~the~~incremental ~~restructuring~~rent ofassociated anwith ~~existing master lease covering nine operating properties described further in Note 6 to~~ the ~~consolidated~~opening ~~financial statements included in Part II, Item 8~~ of ~~this~~two ~~Form~~new ~~10-K and the closure of nine~~ theatres with 9119 screens subsequent to the end of the Fiscal ~~2014~~2015 Period, ~~partially~~and ~~offset~~higher bycontingent ~~incremental~~ rent associated with the ~~opening~~increase ofin ~~two~~total ~~new~~revenues, ~~theatres~~partially ~~with~~offset 24by ~~screens and~~ the ~~acquisition~~closure of ~~five~~13 theatres ~~and~~with 61118 screens subsequent to the end of the Fiscal ~~2014~~2015 Period.

Other Operating Expenses

Other operating expenses increased $5019.5 million, or 6.2.3%, to $~~863~~883.72 million in the Fiscal ~~2015~~2016 Period, from $~~813~~863.27 million in the Fiscal ~~2014~~2015 Period. During the Fiscal ~~2015~~2016 Period, the increase in other operating expenses was primarily attributable to ~~to the impact of a State of New York sales tax refund received by the Company during the Fiscal 2014 Period totaling approximately $16.8 million,~~ increases in theatre level payroll ~~expenses~~and ~~(approximately~~benefit ~~$14.0 million), increases in non-rent occupancy~~ costs ~~(approximately $7~~.0 million), increases in credit card fees and incremental expenses associated with increased internet ticketing surcharge fees (approximately $4.8 million) and increases in other theatre operating expenses (approximately $5.5 million).

General and Administrative Expenses

General and administrative expenses increased $45.48 million, or 57.94%, to $7884.86 million in the Fiscal ~~2015~~2016 Period, from $7478.48 million in the Fiscal ~~2014~~2015 Period. The increase in general and administrative expenses during the Fiscal ~~2015~~2016 Period was primarily attributable to higher legal and professional fees ~~(approximately $4~~.8 ~~million) and corporate payroll costs (approximately $1.5 million), partially offset by lower share-based compensation expense (approximately $1.1 million).~~

Depreciation and Amortization

Depreciation and amortization expense increased $9.6 million, or 4.6%, to $216.8 million for the Fiscal 2015 Period, from $207.2 million in the Fiscal 2014 Period. The increase in depreciation and amortization expense during the Fiscal 2015 Period was primarily related to the impact of increased capital expenditures associated with the installation of luxury reclining seats subsequent to the Fiscal 2014 Period, and the opening of two new theatres with 24 ~~screens (partially offset by the closure of nine theatres with 91 screens) subsequent to the end of the Fiscal 2014 Period.~~

Income from Operations

Income from operations increased $12.9 million, or 4.2%, to $319.3 million during the Fiscal 2015 Period, from $306.4 million in the Fiscal 2014 Period. The increase in income from operations during the Fiscal 2015 Period was primarily

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~~attributable~~Depreciation and amortization expense increased $13.9 million, or 6.4%, to $230.7 million for the Fiscal 2016 Period, from $216.8 million in the Fiscal 2015 Period. The increase in ~~total~~depreciation ~~revenues~~and amortization expense during the Fiscal 2016 Period was primarily related to the impact of increased capital expenditures associated with the installation of luxury reclining seats subsequent to the Fiscal 2015 Period, and to a lesser extent, the opening of two new theatres with 19 screens (partially offset by ~~increases~~the inclosure ~~certain~~of ~~variable~~13 ~~operating~~theatres ~~expense~~with ~~line~~118 ~~items~~screens) ~~described~~subsequent ~~above~~to the end of the Fiscal 2015 Period.

Net Loss on Disposal and Impairment of Operating Assets and Other

Net loss on disposal and impairment of operating assets and other decreased $14.9 million, to $4.8 million for the Fiscal 2016 Period, from $19.7 million in the Fiscal 2015 Period. Included in net loss on disposal and impairment of operating assets and other was a $9.8 million gain on the early termination of a theatre lease during the Fiscal 2016 Period.

Interest Expense, net

During the Fiscal ~~2015~~2016 Period, net interest expense ~~increased~~decreased $3.1.5 million, or 21.52%, to $~~129~~128.61 million, from $~~126~~129.56 million in the Fiscal ~~2014~~2015 Period. The ~~increase~~decrease in net interest expense during the Fiscal ~~2015~~2016 Period was primarily due to ~~incremental~~ interest savings associated with a ~~higher~~lower effective interest rate under the ~~New~~Amended ~~Term Facility, partially offset by interest savings associated with the refinance of approximately $711.4 million aggregate principal amount of the Company's 91/8%~~ Senior ~~Notes~~Credit ~~and 85/8% Senior Notes with the March 2014 issuance of our 53/4% Senior Notes Due 2022~~Facility.

Loss on Extinguishment of Debt

During the Fiscal ~~2015~~2016 Period, the Company recorded aan aggregate loss on debt extinguishment of approximately $52.79 million in connection with athe June 2016 refinancing and December 2016 refinancing of our Amended Senior Credit Facility as further described in Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

Earnings Recognized from NCM

Earnings recognized from NCM decreased $1.16 million, or 35.42%, to $3129.04 million in the Fiscal ~~2015~~2016 Period, from $3231.10 million in the Fiscal ~~2014~~2015 Period. The decrease in earnings recognized from NCM during the Fiscal ~~2015~~2016 Period was primarily attributable to lower ~~earnings~~cash ofdistributions from National CineMedia, partially offset by higher equity income from National CineMedia during the ~~period~~Fiscal 2016 Period.

Income Taxes

The provision for income taxes of $~~100~~111.12 million and $73100.41 million for the Fiscal ~~2015~~2016 Period and the Fiscal ~~2014~~2015 Period, respectively, reflect effective tax rates of approximately 39.5% ~~and 41~~.~~1%,~~ ~~respectively.~~ The ~~decrease in the~~ effective tax rate for the Fiscal 2015 Period is primarily attributable to a decrease in the effective tax rate in certain states during the Fiscal 2015 Period and the state tax effects of the $62.4 million ($39.2 million after related tax effects) loss on debt extinguishment associated with the repurchase of approximately $711.4 million aggregate principal amount of the Company's 91/8% Senior Notes and 85/8% Senior Notes that occurred during the Fiscal 2014 Period, which was not deductible in certain states. The effective tax rates for such periods ~~also~~ reflect the impact of certain non-deductible expenses and other income tax credits.

Quarterly Results

The following table sets forth selected unaudited quarterly results for the eight quarters ended December 31, ~~2016~~2017. The quarterly financial data as of each period presented below have been derived from Regal's unaudited condensed consolidated financial statements for those periods. Results for these periods are not necessarily indicative of results for the full year. The comparability of our results between quarters is impacted by certain factors described below and to a lesser extent, seasonality. The quarterly financial data should be read in conjunction with the consolidated financial statements of Regal and notes thereto included in Part II, Item 8 of this Form 10-K.

	Dec. 31, 2016 (1)		Sept. 30, 2016		June 30, 2016 (2)		March 31, 2016		Dec. 31, 2015		Sept. 30, 2015		June 30, 2015 (3)		March 31, 2015
	Dec. 31, 2017(1)		Sept. 30, 2017(2)		June 30, 2017 (3)		March 31, 2017		Dec. 31, 2016 (4)		Sept. 30, 2016		June 30, 2016 (5)		March 31, 2016
	In millions (except per share data)
Total revenues	$	~~812~~861.6	$	~~811~~716.50	$	~~785~~764.92	$	~~787~~821.12	$	~~848~~812.26	$	~~725~~811.05	$	~~862~~785.89	$	~~691~~787.31
Income from operations(4)	95.0		87.2		76.6		80.6		101.9		51.9		115.1		50.4
Income from operations(6)	90.7		22.5		59.0		99.5		95.0		87.2		76.6		80.6
Net income attributable to controlling interest(4)	53.9		42.3		33.5		40.7		55.0		21.9		53.4		23.1
Net income attributable to controlling interest(6)	28.9		11.4		23.6		48.4		53.9		42.3		33.5		40.7
Diluted earnings per share(4)	0.34		0.27		0.21		0.26		0.35		0.14		0.34		0.15
Diluted earnings per share(6)	$	0.19	$	0.07	$	0.15	$	0.31	$	0.34	$	0.27	$	0.21	$	0.26
Dividends per common share	$	0.22	$	0.22	$	0.22	$	0.22	$	0.22	$	0.22	$	0.22	$	0.22

_______________________________________________________________________________

(1) As ~~described~~discussed ~~further~~ in ~~Note 5 to the consolidated financial statements included in~~ Part ~~II,~~I ~~Item 8~~ of this Form 10-K, on December 25, ~~2016~~2017, Regal ~~Cinemas~~ entered into ~~a permitted secured refinancing agreement with REH,~~ the ~~guarantors~~Merger ~~party~~Agreement ~~thereto, Credit Suisse AG~~ and ~~the~~as ~~lenders~~a ~~party thereto. The permitted secured refinancing agreement further amends the Amended Senior Credit Facility~~result, ~~which~~incurred ~~was~~merger ~~amended~~related byexpenses ~~the June 2016 Refinancing Agreement described in (2) below. In connection with the execution~~ of ~~the permitted secured refinancing agreement, the Company recorded a loss on debt extinguishment of~~ approximately $112.45 million during the quarter ended December 31, ~~2016~~2017.

33(2) As described more fully in Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, during the quarter ended September 30, 2017, the Company recorded a gain on the sale of its investment in Open Road Films of $17.8 million.

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(23) As described further in Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, on June 16, ~~2016~~2017, Regal Cinemas entered into a permitted secured refinancing and incremental joinder agreement with REH, the guarantors party thereto, Credit Suisse AG and the lenders party thereto. The permitted secured refinancing agreement further amends the Amended Senior Credit Facility, which was amended by the June 2016 and December 2016 Refinancing Agreements described in (2) and (3) below. In connection with the execution of the permitted secured refinancing agreement, the Company recorded a loss on debt extinguishment of approximately $1.53 million during the quarter ended June 30, ~~2016~~2017.

(34) As described further in Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, on ~~April~~December 2, ~~2015~~2016, Regal Cinemas entered into a ~~seventh~~permitted ~~amended~~secured ~~and~~refinancing ~~restated credit~~ agreement with ~~Credit~~REH, ~~Suisse~~the AGguarantors asparty ~~Administrative~~thereto, ~~Agent~~Credit Suisse AG and the lenders party thereto. ~~which~~The ~~amended,~~permitted ~~restated~~secured ~~and~~refinancing ~~refinanced~~agreement further amends the ~~sixth~~Amended Senior Credit Facility, which was amended ~~and~~by ~~restated~~the ~~credit~~June ~~agreement~~2016 Refinancing Agreement described in (2) below. AsIn aconnection ~~result~~with the execution of the ~~amendment~~permitted secured refinancing agreement, the Company recorded a loss on debt extinguishment of approximately $51.74 million during the quarter ended ~~June~~December 3031, ~~2015~~2016.

(45) ~~During~~As ~~the~~described ~~eight~~further ~~quarters~~in ~~ended~~Note ~~December~~5 ~~31,~~to ~~2016,~~the weconsolidated ~~recorded~~financial ~~impairment~~statements ~~charges~~included ofin ~~$3.2~~Part ~~million~~II, ~~$3.4~~Item ~~million, $0.~~8 ~~million,~~of ~~$2.2~~this ~~million,~~Form ~~$4.5 million~~10-K, ~~$9.2~~on ~~million,~~June $1.9, ~~million~~2016, ~~$0.0~~Regal ~~million,~~Cinemas ~~respectively,~~entered ~~specific~~into toa ~~theatres~~permitted ~~that~~secured ~~were~~refinancing ~~directly~~agreement ~~and~~with ~~individually~~REH, ~~impacted~~the byguarantors ~~increased~~party ~~competition~~thereto, ~~adverse~~Credit ~~changes~~Suisse inAG ~~market~~and ~~demographics~~the orlenders ~~adverse~~party ~~changes~~thereto. inIn ~~the~~connection ~~development~~with or the ~~conditions~~execution of the ~~areas~~permitted ~~surrounding~~secured ~~the~~refinancing ~~theatre.~~agreement, ~~See Note 2 to~~ the ~~consolidated~~Company ~~financial~~recorded ~~statements~~a ~~included~~loss inon ~~Part~~debt ~~II,~~extinguishment ~~Item 8~~ of ~~this~~approximately ~~Form~~$1.5 ~~10-K~~million ~~for~~during ~~further~~the ~~information~~quarter ~~related~~ended toJune ~~our~~30, ~~impairment policies~~2016.

(6)

During the eight quarters ended December 31, 2017, we recorded long-lived asset and favorable lease impairment charges of $6.5 million, $4.4 million, $2.0 million, $2.1 million, $1.5 million, $3.4 million, $0.8 million, $2.2 million, respectively, specific to theatres that were directly and individually impacted by increased competition, adverse changes in market demographics or adverse changes in the development or the conditions of the areas surrounding the theatre. In addition, during the quarter ended September 30, 2017 and the quarter ended December 31, 2016, we recorded goodwill impairment charges of $7.3 million and $1.7 million, respectively, as the carrying value of one of its reporting units exceeded its estimated fair value. See Note 2 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for further information related to our impairment policies.

Liquidity and Capital Resources

OnThe a consolidated basis, we expect our primary uses of cash to be for operating expenses, capital expenditures, investments, acquisitions, general corporate purposes related to corporate operations, debt service and the Company's ~~dividend~~believes ~~payments. The principal sources of liquidity are~~ cash generated from operations, ~~cash on hand~~ and borrowings under the Amended Senior Credit Facility described below. Under the terms of the Amended Senior Credit Facility, Regal Cinemas is restricted as to how much it can advance or distribute to Regal, its ~~indirect~~existing ~~parent.~~balance ~~Since Regal is a holding company with no significant assets other than the stock~~ of ~~its~~cash ~~subsidiaries,~~and ~~this~~cash ~~restriction~~equivalents ~~could~~will ~~impact~~be ~~Regal's~~sufficient ~~ability~~ to ~~effect~~satisfy ~~future debt or dividend payments, pay corporate expenses, repurchase or retire for cash~~ its ~~53/4%~~working ~~Senior~~capital ~~Notes Due 2022~~needs, ~~its~~outstanding ~~53/4%~~commitments ~~Senior Notes Due 2023~~ and its 53/4% Senior Notes Due 2025. In addition, as described further below, the indentures under which the 53/4% Senior Notes Due 2022, the 53/4% Senior Notes Due 2023, and the 53/4% Senior Notes Due 2025 are issued limit the Company's (and its restricted subsidiaries') ability to, among other ~~things,~~liquidity ~~incur~~requirements ~~additional~~associated ~~indebtedness,~~with ~~pay dividends on or make other distributions in respect of~~ its ~~capital~~existing ~~stock,~~operations ~~purchase~~over orthe ~~redeem~~next ~~capital~~12 ~~stock, make loans or advances to its subsidiaries, or purchase, redeem or otherwise acquire or retire certain subordinated obligations~~months.

Operating Activities

Our revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit cards at the point of sale and through our internet ticketing partners. Our operating expenses are primarily related to film and advertising costs, rent and occupancy and payroll. Film costs are ordinarily paid to distributors within 30 days following receipt of admissions revenues and the cost of the Company’s concessions are generally paid to vendors approximately 30 to 35 days from purchase. Our current liabilities include items that will become due within 12 months. In addition, from time to time, we use cash from operations to fund dividends in excess of net income attributable to controlling interest and to fund dividends in excess of cash flows from operating activities less capital expenditures (net of proceeds from asset sales). ~~As a result, at any given time, our balance sheet may reflect a working capital deficit.~~

Net cash flows provided by operating activities totaled approximately $~~410~~409.59 million, $~~434~~410.45 million and $~~349~~434.14 million for the Fiscal ~~2016~~2017 Period, the Fiscal ~~2015~~2016 Period and the Fiscal ~~2014~~2015 Period, respectively. The $0.6 million decrease in net cash flows generated by operating activities for the Fiscal ~~2016~~2017 Period as compared to the Fiscal ~~2015~~2016 Period was caused by a ~~negative~~decrease in net income excluding non-cash items, partially offset by a positive fluctuation in working capital activity (primarily related to the timing of vendor payments, including film payables, as a result of increased attendance and admissions revenues at our theatres during the latter part of the Fiscal ~~2015~~2017 Period), ~~partially~~and ~~offset by~~ an increase in landlord contributions ~~and~~related anto ~~increase~~our inluxury ~~net~~reclining ~~income~~seating ~~excluding non-cash items~~initiative. The ~~increase~~decrease in net cash flows generated by operating activities for the Fiscal ~~2015~~2016 Period as compared to the Fiscal ~~2014~~2015 Period was caused by a ~~positive~~negative fluctuation in working capital activity (primarily related to the timing of vendor payments, including film payables, as a result of increased attendance and admissions revenues at our theatres during the latter part of the Fiscal 2015 Period), partially offset by an increase in landlord contributions and an increase in net income excluding non-cash items.

Investing Activities

Our capital requirements have historically arisen principally in connection with acquisitions of theatres, new theatre construction, strategic partnerships, the addition of luxury amenities in select theatres, other upgrades to the Company’s theatre facilities and ~~replacing~~ equipment replacement. We fund the cost of capital expenditures through internally generated cash flows, cash on ~~hand, landlord contributions, proceeds from the disposition of assets and financing activities.~~

3426

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Wehand, ~~intend~~landlord tocontributions, ~~continue~~proceeds tofrom ~~grow our theatre circuit through selective expansion and acquisition opportunities. The Company has a formal and intensive review procedure for~~ the ~~authorization~~disposition of ~~capital~~assets ~~projects,~~and ~~with~~financing the most important financial measure of acceptability for a discretionary non-maintenance capital project being whether its projected discounted cash flow return on investment meets or exceeds the Company’s internal rate of return targetsactivities. We ~~currently~~intend ~~expect~~to ~~capital~~continue ~~expenditures~~to ~~(net~~grow ofour ~~proceeds~~theatre ~~from~~circuit ~~asset~~through ~~sales~~selective ~~and landlord contributions) for theatre development,~~ expansion, ~~upgrading~~ and ~~replacements~~acquisition ~~to be in the range of approximately $130~~opportunities.~~0 million to $145.0 million in fiscal year 2017, exclusive of acquisitions.~~

During the Fiscal ~~2016~~2017 Period, we received approximately 0.75 million newly issued common units of National CineMedia in accordance with the annual adjustment provisions of the Common Unit Adjustment Agreement. This transaction ~~caused~~increased aour ~~proportionate increase in the Company's~~ ownership share in National CineMedia to approximately 27.16 million common units. On a fully diluted basis, we own a 1917.79% interest in NCM, Inc. as of December 31, ~~2016~~2017.

~~During~~As ~~the~~described ~~Fiscal~~further ~~2016~~in ~~Period,~~Note ~~RealD,~~3 ~~Inc.~~to ~~stockholders~~the ~~approved~~consolidated anfinancial ~~all-cash~~statements ~~merger~~included ~~whereby~~in ~~Rizvi~~Part ~~Traverse Management~~II, ~~LLC~~Item ~~acquired~~8 ~~RealD~~of this Form 10-K, ~~Inc.~~on ~~for~~April ~~$11.00~~13, ~~per~~2017, ~~share.~~the ~~Under~~Company completed the ~~terms~~acquisition of ~~the~~two ~~merger~~theatres ~~agreement~~with 41 screens located in Houston, ~~RealD~~Texas from Santikos Theaters, Inc. ~~shareholders~~for ~~received~~an ~~$11.00~~aggregate innet cash ~~for~~purchase ~~each~~price ~~share~~ of ~~RealD, Inc~~$29.’s8 ~~common stock~~million. ~~During~~In ~~the~~addition, ~~Fiscal~~on ~~2016~~April ~~Period~~18, 2017, the Company ~~received~~purchased ~~approximately~~a ~~$3.6~~parcel ~~million~~of land located in ~~cash~~Montgomery ~~consideration~~County, ~~for~~Texas ~~its~~from ~~remaining~~an ~~322,780~~entity ~~RealD~~affiliated with Santikos Theaters, Inc. ~~common~~for ~~shares.~~a Asnet acash ~~result~~purchase price, before post-closing adjustments, of ~~the~~approximately ~~transaction~~$7.3 million. Finally, on May 18, 2017, the Company ~~recorded~~completed athe ~~gain~~acquisition of ~~approximately~~seven ~~$1.0~~theatres ~~million~~with ~~during~~93 ~~the~~screens ~~Fiscal~~located ~~2016~~in ~~Period~~Kansas and Oklahoma from Warren Theatres for an aggregate net cash purchase price, before post-closing adjustments, of $134.5 million.

~~Net~~On ~~cash~~August ~~flows~~4, ~~used in investing activities totaled approximately $223.6 million~~2017, ~~$183.3~~the ~~million~~Company ~~and~~sold ~~$150.4~~all ~~million~~of ~~for~~its ~~the~~50% ~~Fiscal~~equity ~~2016~~interest ~~Period,~~in ~~the~~Open ~~Fiscal~~Road ~~2015~~Films ~~Period~~to ~~and~~a ~~the~~third ~~Fiscal~~party ~~2014~~for ~~Period,~~total ~~respectively.~~proceeds ~~The~~of approximately $4014.30 million. ~~increase~~In inaccordance ~~cash~~with ~~flows used in investing activities during~~ the ~~Fiscal~~purchase ~~2016 Period~~agreement, asapproximately ~~compared to the Fiscal 2015 Period, was primarily attributable to a~~ $393.87 million ~~increase~~of inthe ~~capital expenditures (~~net of proceeds ~~from~~received ~~disposals)~~were ~~and~~in ~~higher~~satisfaction ~~capital~~of ~~investments~~various inreceivables ~~certain~~and ~~non-consolidated~~other ~~entities,~~amounts ~~partially~~due ~~offset~~to by the ~~impact~~Company ofrelated ~~$9.2~~to ~~million~~film ofmarketing ~~cash~~services ~~used~~provided ~~for~~to aOpen ~~fiscal~~Road ~~2015~~Films ~~acquisition~~prior ~~and~~to ~~$3.6~~the ~~million~~closing indate. ~~proceeds~~As ~~received~~a ~~related~~result toof the sale ~~of RealD~~, ~~Inc.~~the ~~common~~Company ~~stock~~recorded ~~during~~a ~~the~~gain ~~Fiscal~~of ~~2016~~approximately ~~Period. The~~ $3217.98 million, ~~increase~~representing ~~in cash flows used in investing activities during~~ the ~~Fiscal~~difference ~~2015~~between ~~Period, as compared to~~ the ~~Fiscal~~net ~~2014~~proceeds ~~Period,~~received ~~was~~of ~~primarily attributable to a~~ $1810.63 million ~~increase~~(after insatisfaction ~~capital~~of ~~expenditures~~the ~~(net~~above ofamounts ~~proceeds~~due ~~from~~the ~~disposals~~Company) ~~during~~and the ~~Fiscal~~carrying ~~2015~~amount ~~Period,~~of ~~$9.2~~the ~~million~~Company's ofinvestment ~~cash~~in ~~used~~Open ~~for~~Road ~~the~~Films ~~acquisition~~(approximately of$(7.5) ~~five~~million) ~~theatres~~as ~~with~~of 61the ~~screens~~closing ~~from~~date. ~~entities~~Also ~~affiliated~~effective with ~~Georgia~~closing, ~~Theatre~~the Company, and ~~the~~Open ~~impact~~Road ofFilms ~~$6.0~~entered ~~million~~into ina ~~proceeds~~new ~~received~~marketing ~~related~~agreement towith ~~the~~respect ~~sale~~to offilms ~~RealD,~~released ~~Inc.~~by ~~common~~Open ~~stock~~Road ~~during~~Films after the ~~Fiscal~~closing ~~2014 Period~~date.

Net cash flows used in investing activities totaled approximately $410.6 million, $223.6 million and $183.3 million for the Fiscal 2017 Period, the Fiscal 2016 Period and the Fiscal 2015 Period, respectively. The $187.0 million increase in cash flows used in investing activities during the Fiscal 2017 Period, as compared to the Fiscal 2016 Period, was primarily attributable to $171.6 million of net cash used to fund acquisitions, a $20.8 million increase in capital expenditures (net of proceeds from disposals), partially offset by approximately $10.3 million of proceeds received from the sale of our Open Road Films investment. The $40.3 million increase in cash flows used in investing activities during the Fiscal 2016 Period, as compared to the Fiscal 2015 Period, was primarily attributable to a $39.8 million increase in capital expenditures (net of proceeds from disposals) and higher capital investments in certain non-consolidated entities, partially offset by the impact of $9.2 million of cash used for a fiscal 2015 acquisition and $3.6 million in proceeds received related to the sale of RealD, Inc. common stock during the Fiscal 2016 Period.

Financing Activities

As described further in Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, on June 1, 2016 Regal Cinemas entered into a permitted secured refinancing agreement with REH, the guarantors party thereto, Credit Suisse AG and the lenders party thereto (the "June 2016 Refinancing Agreement"). Pursuant to the June 2016 Refinancing Agreement, Regal Cinemas consummated a permitted secured refinancing of the Term Facility under the Amended Senior Credit Facility, which had an aggregate principal balance of approximately $958.5 million, and in accordance therewith, received term loans in an aggregate principal amount of approximately $958.5 million with a final maturity date in April 2022. Together with other amounts provided by Regal Cinemas, proceeds of the term loans were applied to repay all of the outstanding principal and accrued and unpaid interest on the Term Facility under the Amended Senior Credit Facility. In connection with the execution of the June 2016 Refinancing Agreement, the Company recorded a loss on debt extinguishment of approximately $1.5 million during the quarter ended June 30, 2016.

On December 2, 2016, Regal Cinemas entered into a permitted secured refinancing agreement (the “"December 2016 Refinancing Agreement”") with REH, the guarantors party thereto, Credit Suisse AG and the lenders party thereto. ~~The~~ ~~December 2016 Refinancing Agreement further amends the Amended Senior Credit Facility, which was amended by the June 2016 Refinancing Agreement.~~ Pursuant to the December 2016 Refinancing Agreement, Regal Cinemas consummated a permitted secured refinancing of the Term Facility, which had an aggregate principal balance of approximately $956.1 million, and in accordance therewith, ~~the~~received ~~Lenders advanced~~ term loans in an aggregate principal amount of approximately $956.1 million with a final maturity date in April 2022 ~~(the “New Term Loans”)~~. Together with other amounts provided by Regal Cinemas, proceeds of the ~~New~~term ~~Term~~loans ~~Loans~~ were applied to repay all of the outstanding principal and accrued and unpaid interest on the ~~existing~~Term ~~term~~Facility ~~facility~~ under the Amended Senior Credit Facility ~~in effect immediately prior to the making of the New Term Loans~~. The New Term Loans amortize in equal quarterly installments in an aggregate annual amount equal to 1.0% of the original principal amount of the New Term Loans, with the balance payable on the maturity date of the New Term Loans. The December 2016 Refinancing Agreement also amends the Amended Senior Credit Facility by reducing the interest rate on the New Term Loans, by providing, at Regal Cinemas’ option, either a base rate or an adjusted LIBOR rate plus, in each case, an applicable margin. Such applicable margin will be either 1.50% in the case of base rate loans or 2.50% in the case of LIBOR rate loans. The December 2016 Refinancing Agreement also provides for a 1% prepayment premium applicable in the event that Regal Cinemas enters into a refinancing or amendment of the New Term Loans on or prior to the sixth-month anniversary of the closing of the December 2016 Refinancing Agreement that, in either case, has the effect of reducing the interest rate on the New Term Loans. In connection with the execution of the December 2016 Refinancing Agreement, the Company recorded a loss on debt extinguishment of approximately $1.4 million during the quarter ended December 31, 2016.

35On June 6, 2017, Regal Cinemas entered into a permitted secured refinancing and incremental joinder agreement (the "June 2017 Refinancing Agreement") with REH, the guarantors party thereto, Credit Suisse AG and the lenders party thereto. Pursuant to the June 2017 Refinancing Agreement, Regal Cinemas consummated a permitted secured refinancing of the Term Facility, which had an aggregate principal balance of approximately $953.7 million, and in accordance therewith, received term

Table of Contents

Asloans ofin ~~December 31,~~an ~~2016,~~aggregate weprincipal ~~had~~amount of approximately $~~954~~953.7 million ~~aggregate~~with ~~principal~~a ~~amount~~final ~~outstanding~~maturity ~~(net~~date ofin ~~debt~~April ~~discount)~~2022 ~~under~~ (the ~~New~~"Refinanced Term Loans~~, $775~~").0 ~~million~~Together ~~aggregate~~with ~~principal~~other ~~amount~~amounts ~~outstanding~~provided ~~under~~by ~~the~~Regal ~~53/4%~~Cinemas, ~~Senior~~proceeds ~~Notes~~of ~~Due~~the ~~2022,~~Refinanced ~~$250.0~~Term ~~million~~Loans ~~aggregate~~were ~~principal~~applied ~~amount~~to ~~outstanding~~repay ~~under~~all of the ~~53/4%~~outstanding ~~Senior~~principal ~~Notes~~and ~~Due~~accrued ~~2023~~ and ~~$250.0~~unpaid ~~million~~interest ~~aggregate~~on ~~principal~~the ~~amount~~existing ~~outstanding~~term facility under the ~~53/4%~~Amended Senior ~~Notes~~Credit ~~Due~~Facility ~~2025. As of December 31, 2016, we had approximately $2.7 million outstanding~~ in ~~letters~~effect ofimmediately ~~credit,~~prior ~~leaving~~to ~~approximately $82.3 million available for drawing under~~ the ~~Revolving~~making ~~Facility. As~~ of ~~December 31,~~the ~~2016,~~Refinanced weTerm ~~are in full compliance with all agreements, including all related covenants, governing our outstanding debt obligations~~Loans.

~~The~~Pursuant ~~Company~~to isthe ~~rated~~June by2017 ~~nationally~~Refinancing ~~recognized~~Agreement, ~~rating~~Regal ~~agencies.~~Cinemas ~~The~~also ~~significance~~exercised ofthe ~~individual~~"accordion" ~~ratings~~feature ~~varies~~under ~~from~~the ~~agency~~Amended Senior Credit Facility to ~~agency.~~increase ~~However,~~the ~~companies~~aggregate ~~assigned~~amount ~~ratings~~of atterm ~~the~~loans ~~top~~thereunder ~~end~~by of$150.0 million (the ~~range~~"2017 ~~have,~~Accordion"). inThe ~~the~~"accordion" ~~opinion~~feature ofprovided ~~certain~~Regal ~~rating~~Cinemas ~~agencies,~~with the ~~strongest~~option ~~capacity~~to ~~for~~borrow ~~repayment~~additional ofterm ~~debt~~loans orunder ~~payment~~the Amended Senior Credit Facility in an amount of ~~claims~~up to $200.0 million, ~~while~~plus ~~companies~~additional atamounts ~~the~~as ~~bottom~~would ~~end~~not ofcause the ~~range~~consolidated ~~have~~total ~~the~~leverage ~~weakest~~ratio ~~capability~~to exceed 3.00:1.00, ~~Ratings~~in ~~are~~each ~~always~~case, subject to ~~change~~lenders ~~and~~providing ~~there~~additional ~~can~~commitments befor nosuch ~~assurance~~amounts ~~that~~and the ~~Company's~~satisfaction ~~current~~of ~~ratings~~certain ~~will~~other ~~continue~~customary ~~for~~conditions. ~~any~~The ~~given~~entire ~~period~~$150.0 ofmillion ~~time.~~under Anthe ~~upgrade~~2017 orAccordion ~~downgrade~~was offully ~~the~~drawn ~~Company's~~on ~~debt~~June ~~ratings~~6, ~~depending~~2017 on the ~~extent~~same terms as the Refinanced Term Loans (such amounts drawn, ~~could~~the ~~affect~~"Incremental Term Loans", and together with the ~~cost~~Refinanced toTerm ~~borrow~~Loans, ~~funds~~the "New Term Loans"). ~~There~~A portion of the proceeds of the Incremental Term Loans were noused ~~upgrades~~by orRegal ~~downgrades~~Cinemas to ~~the~~pay ~~Company's~~fees ~~debt~~and ~~ratings~~expenses ~~that~~related ~~materially~~to ~~impacted~~the ~~our~~June ~~ability~~2017 orRefinancing ~~cost~~Agreement, with the remainder to ~~borrow~~be ~~funds~~used ~~during~~for ~~the~~general ~~fiscal~~corporate ~~year~~purposes ~~ended~~of ~~December 31,~~Regal ~~2016~~Cinemas and its subsidiaries.

~~During~~The ~~the~~New ~~Fiscal~~Term ~~2016~~Loans ~~Period,~~amortized ~~Regal~~in ~~paid~~equal ~~four~~ quarterly ~~cash~~installments ~~dividends~~in ofan ~~$0.22~~aggregate ~~per~~annual ~~share~~amount onequal ~~each~~to ~~outstanding~~1.0% ~~share~~ of the ~~Company's~~original ~~Class A~~principal ~~and~~amount ~~Class B~~of ~~common stock, or approximately $138.9 million in~~ the ~~aggregate.~~New OnTerm ~~February 9~~Loans, ~~2017,~~with the ~~Company~~balance ~~declared~~payable ~~a cash dividend of $0.22 per share~~ on ~~each share of~~ the ~~Company's~~maturity ~~Class A~~date ~~and Class B common stock (including outstanding restricted stock), payable on March 15, 2017 to stockholders~~ of ~~record~~the onNew ~~March 3,~~Term ~~2017~~Loans. ~~Declared~~In ~~dividends~~connection ~~have~~with ~~been or will be funded through cash flow from operations and available cash on hand. We, at~~ the ~~discretion~~execution of ~~our~~the ~~Board~~June of2017 ~~Directors~~Refinancing ~~and subject to applicable law~~Agreement, ~~anticipate~~the ~~paying~~Company ~~regular~~recorded ~~quarterly~~a ~~dividends~~loss on ~~our~~debt ~~Class A~~extinguishment ~~and~~of ~~Class B~~approximately ~~common stock for the foreseeable future~~$1.3 ~~The~~million ~~amount,~~during ~~if any, of~~ the ~~dividends~~quarter toended beJune ~~paid in the future will depend upon our then available cash~~30, ~~anticipated cash needs, overall financial condition, loan agreement restrictions, future prospects for earnings and cash flows, as well as other relevant factors~~2017.

~~Net~~As ~~cash~~of ~~flows~~December 31, ~~provided~~2017, ~~used~~we inhad ~~financing activities were~~ approximately $~~160.0 million~~1, ~~$178~~097.62 million ~~and~~aggregate ~~$332.5~~principal ~~million~~amount ~~for~~outstanding ~~the~~(net ~~Fiscal~~of ~~2016~~debt ~~Period,~~discount) ~~the~~under ~~Fiscal 2015 Period and~~ the ~~Fiscal~~New ~~2014~~Term ~~Period~~Loans, ~~respectively~~$775.0 ~~The~~million ~~net~~aggregate ~~decrease~~principal inamount ~~cash~~outstanding ~~flows~~under ~~used in financing activities during~~ the ~~Fiscal~~53/4% ~~2016~~Senior ~~Period~~Notes asDue ~~compared~~2022, ~~to the Fiscal 2015 Period of~~ $18250.60 million ~~was~~aggregate ~~primarily~~principal ~~attributable~~amount tooutstanding ~~the~~under ~~net impact of~~ the ~~Amended~~53/4% Senior ~~Credit~~Notes ~~Facility~~Due ~~refinancing~~2023 ~~effected~~and ~~during the Fiscal 2015 Period~~$250. ~~The~~0 ~~net~~million ~~decrease~~aggregate inprincipal ~~cash~~amount ~~flows~~outstanding ~~used~~under ~~in financing activities during~~ the ~~Fiscal~~53/4% ~~2015~~Senior ~~Period~~Notes asDue ~~compared~~2025. As ~~to the Fiscal 2014 Period~~ of ~~$153.9~~December 31, ~~million~~2017, ~~was~~we ~~primarily~~had ~~attributable~~approximately ~~to a~~ $~~155~~2.7 million ~~decrease~~outstanding in ~~dividends~~letters ~~paid~~of tocredit, ~~stockholders~~leaving ~~during~~approximately ~~the~~$82.3 million ~~2015~~available ~~Fiscal~~for ~~Period~~drawing asunder ~~compared~~the toRevolving ~~the~~Facility. As ~~2014~~of ~~Fiscal~~December 31, ~~Period~~2017, ~~lower~~we ~~payments~~are ~~on long-term obligations and landlord contributions received~~ in ~~connection~~full compliance with ~~amended~~all ~~lease financing arrangements~~agreements, ~~partially~~including ~~offset~~all byrelated ~~the~~covenants, ~~net~~governing ~~impact~~our ofoutstanding ~~the~~debt ~~Amended Senior Credit Facility refinancing effected during the Fiscal 2015 Period~~obligations.

~~EBITDA~~In connection with the consummation of the Merger, on February 28, 2018, all amounts outstanding under the Amended Senior Credit Facility were repaid in full, and the Amended Senior Credit Facility was terminated. Additionally, on February 28, 2018: (i) we notified Wilmington Trust National Association, in its capacity as trustee (the “Trustee”), under the indentures governing our 53/4% Senior Notes Due 2022, 53/4% Senior Notes Due 2023 and 53/4% Senior Notes Due 2025 (collectively, the “Notes”) of our intention to redeem all of the aggregate principal amounts outstanding under the Notes, (ii) at our request, the Trustee distributed an irrevocable notice of redemption to holders of the Notes, and (iii) we deposited with the Trustee funds in trust solely for the benefit of the holders of the Notes sufficient to pay and discharge the entire indebtedness on the Notes and thereby satisfied and discharged the indentures pursuant to the terms therein. The Notes will be redeemed in full on March 30, 2018. For more information regarding financing activities occurring after December 31, 2017, in connection with the Merger, refer to Note 16 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

~~Net~~During ~~income~~the ~~attributable~~Fiscal to2017 ~~controlling~~Period, ~~interest~~Regal ~~adjusted~~paid ~~for~~four ~~interest~~quarterly ~~expense,~~cash ~~net,~~dividends ~~provision~~of ~~for~~$0.22 ~~income~~per ~~taxes~~share ~~and~~on ~~depreciation~~each outstanding share of the Company's Class A and ~~amortization~~Class B ~~("EBITDA")~~common ~~was~~stock, or approximately $~~640~~138.49 million, ~~$599~~in the aggregate.9 ~~million~~On ~~and~~February 7, 2018, the Company declared a cash dividend of $~~512~~0.722 ~~million~~per ~~for~~share on each share of the ~~Fiscal~~Company's ~~2016~~Class A ~~Period~~and Class B common stock (including outstanding restricted stock), ~~the~~which ~~Fiscal~~was ~~2015~~paid ~~Period~~on ~~and~~February ~~the~~26, ~~Fiscal~~2018 ~~2014~~to ~~Period~~stockholders of record on February 17, ~~respectively~~2018. Declared dividends have been funded through cash flow from operations and available cash on hand.

~~The~~Net ~~Company~~cash ~~uses~~flows ~~EBITDA~~used asin afinancing ~~supplemental~~activities ~~liquidity~~were ~~and~~approximately ~~performance~~$17.0 ~~measure because we find it useful to understand and evaluate our capacity~~million, ~~excluding~~$160.0 ~~the~~million ~~impact of interest, taxes,~~ and ~~non-cash~~$178.6 ~~depreciation~~million ~~and amortization charges,~~ for ~~servicing~~the ~~our~~Fiscal ~~debt,~~2017 ~~paying dividends and otherwise meeting our cash needs~~Period, ~~prior to our consideration of~~ the ~~impacts~~Fiscal of2016 ~~other~~Period ~~potential sources~~ and ~~uses~~the ofFiscal ~~cash~~2015 Period, ~~such as working capital items~~respectively. WeThe ~~believe~~net ~~that~~decrease ~~EBITDA~~in ~~is useful to investors for these purposes as well. EBITDA should not be considered an alternative to, or more meaningful than, net~~ cash ~~provided~~flows ~~by or~~ used in ~~operating~~financing activities, asduring ~~determined in accordance with GAAP, since it omits~~ the ~~impact~~Fiscal of2017 ~~interest,~~Period ~~taxes and changes in working capital that use or provide cash (such~~ as ~~receivables,~~compared ~~payables~~to ~~and inventories) as well as~~ the ~~sources~~Fiscal or2016 ~~uses~~Period of ~~cash associated with changes in other balance sheet items (such as long-term loss accruals and deferred items)~~$143.0 ~~Because~~million ~~EBITDA~~was ~~excludes~~primarily ~~depreciation~~attributable ~~and~~to ~~amortization,~~incremental ~~EBITDA~~borrowings ~~does~~under ~~not reflect any cash requirements for~~ the ~~replacement~~Amended ofSenior ~~the~~Credit ~~assets~~Facility ~~being depreciated and amortized, which assets will often have to be replaced~~ in ~~the~~connection ~~future.~~with ~~Further, EBITDA, because it also does not reflect~~ the ~~impact~~June of2017 ~~debt~~Refinancing ~~service,~~Agreement. The ~~income~~net ~~taxes,~~decrease ~~cash~~in ~~dividends, capital expenditures and other~~ cash ~~commitments~~flows ~~from~~used ~~time to time as described~~ in ~~more~~financing ~~detail~~activities ~~elsewhere~~during inthe ~~this~~Fiscal ~~Form~~2016 ~~10-K,~~Period ~~does~~as ~~not~~compared ~~represent how much discretionary cash we have available for other purposes. Nonetheless, EBITDA is a key measure expected by and useful~~ to ~~our fixed income investors, rating agencies and~~ the ~~banking~~Fiscal ~~community,~~2015 ~~all~~Period of ~~whom~~$18.6 ~~believe,~~million ~~and~~was weprimarily ~~concur,~~attributable ~~that these measures are critical~~ to the ~~capital~~net markets’ analysis of our ability to service debt, fund capital expenditures, pay dividends and otherwise meet cash needs, respectively. We also evaluate EBITDA because it is clear that movements in this non-GAAP measure impact ~~our ability to attract financing and pay dividends. EBITDA, as calculated, may not be comparable to similarly titled measures reported by other companies. A reconciliation~~ of ~~net~~the ~~income~~Amended ~~attributable~~Senior toCredit ~~controlling~~Facility ~~interest~~refinancing toeffected ~~EBITDA~~during tothe ~~net~~Fiscal ~~cash~~2015 ~~provided by operating activities is calculated as follows (in millions):~~Period.

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	Fiscal 2016 Period			Fiscal 2015 Period			Fiscal 2014 Period
Net income attributable to controlling interest	$	170.4		$	153.4		$	105.6
Interest expense, net	128.1			129.6			126.5
Provision for income taxes	111.2			100.1			73.4
Depreciation and amortization	230.7			216.8			207.2
EBITDA	$	640.4		$	599.9		$	512.7
Interest expense, net	(128.1		)	(129.6		)	(126.5		)
Provision for income taxes	(111.2		)	(100.1		)	(73.4		)
Deferred income taxes	2.4			(10.9		)	6.6
Changes in operating assets and liabilities	(67.4		)	35.5			(42.9		)
Loss on extinguishment of debt	2.9			5.7			62.4
Landlord contributions	75.3			32.2			8.8
Other items, net	(3.8		)	1.7			1.4
Net cash provided by operating activities	$	410.5		$	434.4		$	349.1

Interest Rate Swaps

As described in Note 13 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, as of December 31, 2016, the Company maintained one effective hedging relationship via one distinct interest rate swap agreement (maturity date of June 30, 2018), which requires Regal Cinemas to pay interest at a fixed rate of 2.165% and receive interest at a variable rate. This interest rate swap agreement is designated to hedge $200.0 million of variable rate debt obligations at an effective rate of approximately 4.7% as of December 31, 2016. See Note 14 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for a discussion of the Company's interest rate swap fair value estimation methods and assumptions.

Sale-Leaseback Transactions

For information regarding our various sale and leaseback transactions, refer to Note 6 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

~~Contractual Cash Obligations and Commitments~~28

The Company has assumed long-term contractual obligations and commitments in the normal course of business, primarily debt obligations and non-cancelable operating leases. Other than the operating leases that are detailed below, the Company does not utilize variable interest entities or any other form of off-balance sheet financing. As of December 31, 2016, the Company's estimated contractual cash obligations and commercial commitments over the next several periods are as follows (in millions):

	Payments Due By Period
	Total		Current		13 - 36 months		37 - 60 months		After 60 months
Contractual Cash Obligations:
Debt obligations(1)	$	2,233.8	$	10.9	$	21.8	$	19.2	$	2,181.9
Future interest on debt obligations(2)	627.6		107.9		210.4		207.6		101.7
Capital lease obligations, including interest(3)	15.8		3.1		1.8		1.9		9.0
Lease financing arrangements, including interest(3)	143.6		21.8		42.0		24.9		54.9
Purchase obligations(4)	107.7		76.9		30.8		—		—
Operating leases(5)	2,911.6		426.9		772.5		584.2		1,128.0
FIN 48 liabilities(6)	0.3		0.3		—		—		—
Total	$	6,040.4	$	647.8	$	1,079.3	$	837.8	$	3,475.5

Table of Contents

Contractual Cash Obligations and Commitments

The Company has assumed long-term contractual obligations and commitments in the normal course of business, primarily debt obligations and non-cancelable operating leases. Other than the operating leases that are detailed below, the Company does not utilize variable interest entities or any other form of off-balance sheet financing. As of December 31, 2017, the Company's estimated contractual cash obligations and commercial commitments over the next several periods are as follows (in millions):



	Payments Due By Period
	Total		Current		13 - 36 months		37 - 60 months		After 60 months
Contractual Cash Obligations:
Debt obligations(1)	$	2,375.0	$	12.4	$	23.5	$	1,839.1	$	500.0
Future interest on debt obligations(2)	559.1		114.1		227.7		174.2		43.1
Capital lease obligations, including interest(3)	12.9		1.0		1.8		2.0		8.1
Lease financing arrangements, including interest(3)	129.7		22.2		35.0		19.8		52.7
Purchase obligations(4)	119.8		87.6		32.2		—		—
Operating leases(5)	3,121.6		446.1		763.6		615.1		1,296.8
FIN 48 liabilities(6)	0.4		0.4		—		—		—
Total	$	6,318.5	$	683.8	$	1,083.8	$	2,650.2	$	1,900.7



	Amount of Commitment Expiration per Period
	Total Amounts Available		Current		13 - 36 months		37 - 60 months		After 60 months
Other Commercial Commitments(7)	$	85.0	$	—	$	—	$	85.0	$	—

_______________________________________________________________________________

(1) These amounts are included on our consolidated balance sheet as of December 31, ~~2016~~2017. Our Amended Senior Credit Facility ~~provides~~provided for mandatory prepayments under certain scenarios. See Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for additional information about our long-term debt obligations and related matters.

(2) Future interest payments on the Company's unhedged debt obligations as of December 31, ~~2016~~2017 (consisting of approximately $~~756~~898.12 million of variable interest rate borrowings under the New Term Loans, $775.0 million outstanding under the 53/4% Senior Notes Due 2022, $250.0 million outstanding under the 53/4% Senior Notes Due 2025, $250.0 million outstanding under the 53/4% Senior Notes Due 2023 and approximately $42.18 million of other debt obligations) are based on the stated fixed rate or in the case of the $~~756~~898.12 million of variable interest rate borrowings under the New Term Loans, the current interest rate specified in our Amended Senior Credit Facility as of December 31, ~~2016~~2017 (3.2757%). Future interest payments on the Company's hedged indebtedness as of December 31, ~~2016~~2017 (the remaining $200.0 million of borrowings under the New Term Loans) are based on (i) the applicable margin (as defined in Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K) as of December 31, ~~2016~~2017 (2.500%) and (ii) the expected fixed interest payments under the Company's interest rate swap agreement, which is described in further detail under Note 13 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

(3) The present value of these obligations, excluding interest, is included on our consolidated balance sheet as of December 31, ~~2016~~2017. Future interest payments are calculated based on interest rates implicit in the underlying leases, which have a weighted average interest rate of 11.2322%, maturing in various installments through 2028. Refer to Note 5 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K for additional information about our capital lease obligations and lease financing arrangements.

(4) Includes estimated capital expenditures and investments to which we were contractually obligated as of December 31, ~~2016~~2017, including improvements associated with existing theatres (including luxury reclining seating), the construction of new theatres and investments in non-consolidated entities. Does not include non-committed capital expenditures.

(5)

We enter into operating leases in the ordinary course of business. Such lease agreements provide us with the option to renew the leases at defined or then fair value rental rates for various periods. Our future operating lease obligations would change if we exercised these renewal options or if we enter into additional operating lease agreements. Our operating lease obligations are further described in Note 6 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

(6) The table does not include approximately $6.3 million of recorded liabilities associated with unrecognized state tax benefits because the timing of the related payments was not reasonably estimable as of December 31, ~~2016~~2017.

(7) In addition, as of December 31, 2016, Regal Cinemas had approximately $82.3 million available for drawing under the $85.0 million Revolving Facility. Regal Cinemas also maintains a sublimit within the Revolving Facility of $10.0 million for short-term loans and $30.0 million for letters of credit.29

WeTable ~~believe that the amount~~ of cash and cash equivalents on hand, cash flow expected from operations and availability under our Revolving Facility will be adequate for the Company to execute its business strategy and meet anticipated requirements for lease obligations, capital expenditures, working capital and debt service for the next 12 months.Contents


(7)	In addition, as of December 31, 2017, Regal Cinemas had approximately $82.3 million available for drawing under the $85.0 million Revolving Facility. Regal Cinemas also maintained a sublimit within the Revolving Facility of $10.0 million for short-term loans and $30.0 million for letters of credit.

Off-Balance Sheet Arrangements

Other than the operating leases detailed above in this Form 10-K, under the heading "Contractual Cash Obligations and Commitments," the Company has no other off-balance sheet arrangements.

Recent Accounting Pronouncements

~~For~~Adoption ~~a discussion~~ of ~~the~~New ~~recent~~Accounting accounting pronouncements relevant to our operations, please refer to the information provided under Note 2 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, which information is incorporated herein by reference.Pronouncements

~~Item 7A~~In March 2016, the FASB issued ASU 2016-07, Investments - Equity Method and Joint Ventures (Topic 323). ~~QUANTITATIVE~~ ~~AND~~The ~~QUALITATIVE~~purpose ~~DISCLOSURES~~of ~~ABOUT~~ASU ~~MARKET~~2016-07 ~~RISK~~is to eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment was held. ASU 2016-07 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and early adoption is permitted. The Company's adoption of ASU 2016-07 during the quarter ended March 31, 2017 had no impact on the Company's consolidated financial statements and related disclosures.

In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which relates to the accounting for employee share-based payments. ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and early adoption is permitted. The Company’'s ~~interest~~adoption ~~rate~~of ~~risk~~ASU is2016-09 ~~confined~~had the impact of reducing income tax expense by approximately $1.3 million pertaining to ~~interest~~excess ~~rate~~tax ~~exposure~~benefits related to vesting of ~~its~~493,516 restricted stock awards and ~~its~~to ~~wholly~~a ~~owned~~lesser ~~subsidiaries’~~extent, ~~debt~~dividends ~~obligations~~paid ~~that~~on ~~bear~~restricted ~~interest~~stock ~~based~~during onthe ~~floating~~year ~~rates~~ended December 31, 2017. ~~The~~Historically, ~~Amended~~such ~~Senior~~excess ~~Credit~~tax ~~Facility~~benefits ~~provides~~would ~~variable~~have ~~rate~~been ~~interest~~recorded ~~that~~as a component of additional paid-in capital.

38In October 2016, the FASB issued ASU 2016-17, Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control, which requires when assessing which party is the primary beneficiary in a VIE, the decision maker considers interests held by entities under common control on a proportionate basis instead of treating those interests as if they were that of the decision maker itself, as current U.S. GAAP requires. ASU 2016-17 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and early adoption is permitted. The Company's adoption of ASU 2016-17 during the quarter ended March 31, 2017 had no impact on the Company's consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The purpose of ASU 2017-04 is to simplify the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within that year. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company early adopted ASU 2017-04 in connection with its interim goodwill impairment test performed during the year ended December 31, 2017 as further described in Notes 2 and 14 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K.

Recently Issued FASB Accounting Standard Codification Updates

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~~could~~including beinterim ~~adversely~~reporting ~~affected~~periods bywithin anthat ~~increase~~reporting inperiod, ~~interest~~with ~~rates.~~early ~~Borrowings~~adoption ~~under~~permitted ~~the~~as ~~New~~of ~~Term~~the ~~Loans~~original ~~bear~~effective ~~interest~~date. In addition, atamendments ~~Regal~~in ~~Cinemas’~~subsequent ~~option,~~Accounting atStandards ~~either~~Updates ahave ~~base~~either ~~rate~~clarified or anrevised ~~adjusted~~guidance ~~LIBOR~~as ~~rate~~set ~~plus,~~forth in ~~each~~ASU ~~case~~2014-09, anincluding ~~applicable~~ASU ~~margin.~~2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus

~~Under~~Agent ~~the~~Considerations ~~terms of the Company's effective interest rate swap agreement~~ (~~which~~Reporting ~~hedges~~Revenues anGross ~~aggregate~~versus ofNet), ~~$200.0 million~~ASU ~~of variable rate debt obligations as of December 31~~2016-10, ~~2016)~~Revenue ~~described~~from inContracts ~~Note 13~~with toCustomers: ~~the~~Identifying ~~consolidated~~Performance ~~financial~~Obligations ~~statements~~and ~~included~~Licensing inand ~~Part II,~~ASU ~~Item 8 of this Form 10~~2016-K12, ~~Regal~~Revenue ~~Cinemas~~from ~~pays~~Contracts ~~interest~~with atCustomers: aNarrow-Scope ~~fixed~~Improvements ~~rate of 2.165%~~ and ~~receives~~Practical ~~interest at a variable rate~~Expedients.

AsThe Company has selected the modified retrospective method for adoption of ~~December 31,~~ASU ~~2016~~2014-09 and ~~December 31,~~its ~~2015~~related ASU amendments. Under this method, ~~borrowings~~we ofwill ~~$954.7~~recognize ~~million~~the ~~(net~~cumulative effect of ~~debt~~the ~~discount)~~changes ~~and~~in ~~$958.8~~retained ~~million~~earnings ~~(net~~at the date of ~~debt~~adoption ~~discount)~~(January 1, ~~respectively~~2018) as described below, ~~were~~but ~~outstanding~~will ~~under~~not ~~the~~restate ~~New~~prior ~~Term~~periods. The ~~Loans~~adoption of ASU 2014-09 and ~~the~~its ~~Prior~~related ~~Term~~ASU ~~Facility~~amendments atprimarily animpacts ~~effective~~the ~~interest~~Company's ~~rate~~accounting offor ~~3.56%~~its (asi) ofloyalty ~~December 31~~program, ~~2016~~(ii) gift cards and ~~4.17%~~bulk ~~(as~~tickets, ofincluding ~~December~~commissions ~~31,~~paid ~~2015),~~to ~~respectively~~third parties, ~~after~~(iii) the ~~impact~~classification of ~~interest~~internet ~~rate~~ticketing ~~swaps~~surcharges isand ~~taken~~(iv) ~~into~~amounts ~~account. A~~recorded ~~hypothetical~~as ~~change~~deferred revenue and the method of ~~10%~~amortization infor the ~~Company's~~advanced ~~effective~~payment ~~interest~~received ~~rate~~in ~~under~~connection with the ~~New~~2007 ~~Term~~National ~~Loans~~CineMedia asESA modification and subsequent receipts of ~~December 31,~~common ~~2016,~~units ~~would~~of ~~increase~~National orCineMedia ~~decrease~~pursuant ~~interest~~to ~~expense~~the byprovisions $3of the Common Unit Adjustment Agreement.~~4 million~~ ~~for~~While we do not believe the ~~fiscal~~adoption ~~year~~of ~~ended~~ASU ~~December 31~~2014-09 will have a material impact on our net income or cash flows from operations, ~~2016.~~we do expect the standard to materially impact the timing and classification of revenues and related expenses in the following key areas:

39• First, we believe the advanced payment received in connection with the 2007 National CineMedia ESA modification and subsequent receipts of common units of National CineMedia pursuant to the provisions of the Common Unit Adjustment Agreement, each as described in Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, include a significant financing component under ASU 2014-09. Accordingly, we expect advertising revenues will increase materially with a similar offsetting increase in non-cash interest expense beginning January 1, 2018. Through December 31, 2017, the Company utilized the units of revenue method to amortize such amounts, but will change its amortization to a straight-line method under ASU 2014-09 effective January 1, 2018. We do not expect these changes to have a material impact on our net income or cash flows from operations. As of the date of this Form 10-K, the Company expects to reduce its opening January 1, 2018 retained earnings balance (along with a corresponding credit to deferred revenue) by approximately $15 million to $20 million, before related tax effects, to give effect to the change in amortization method with respect to these advanced payments.

•

Second, under ASU 2014-09 and effective January 1, 2018, the Company will record internet ticketing surcharge fees based on the gross transaction price. Previously, the Company recorded such fees net of third-party commission or service fees. This change will have the effect of materially increasing other operating revenues and other operating expenses, but will have no impact on net income or cash flows from operations.

•

Third, with respect to our gift card and bulk ticket programs, the adoption of ASU 2014-09 is not expected to have a material impact on the annual revenue we currently recognize from these programs, but it will change the method in which we recognize revenue from gift cards and bulk tickets. Through December 31, 2017, the Company recognized revenue associated with gift cards and bulk tickets when redeemed, or when the likelihood of redemption became remote (known as "breakage" in our industry) based on historical experience. Under ASU 2014-09 and effective January 1, 2018, the Company will recognize revenue from unredeemed gift cards and bulk tickets as redeemed and will recognize breakage following the proportional method where revenue is recognized in proportion to the pattern of rights exercised by the customer when the Company expects that it is probable that a significant revenue reversal would not occur for any estimated breakage amounts. As of the date of this Form 10-K, the Company expects to reduce its opening January 1, 2018 retained earnings balance (along with a corresponding credit to deferred revenue) by approximately $25 million to $30 million, before related tax effects, to give effect to this change in accounting for our gift card and bulk ticket programs.

With respect to gift card commissions paid to third parties, under ASU 2014-09 and effective January 1, 2018, the Company will begin to amortize the commission fees over the expected redemption period. Previously, such gift card commissions were expensed as incurred. We do not expect these changes to have a material impact on our net income or cash flows from operations, however we do expect to increase our opening January 1, 2018 retained earnings balance (along with a corresponding debit to a gift card commission contract asset) by approximately $18 million to $20 million, before related tax effects, to give effect to this change in accounting for our gift card commissions.

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•

Finally, with respect to other areas impacted by ASU 2014-09 such as our loyalty program, we do not expect those accounting changes to have a material impact on our net income or cash flows from operations. Through December 31, 2017, the Company recorded the estimated incremental cost of providing awards under the Regal Crown Club® loyalty program at the time the awards are earned. Under ASU 2014-09 and effective January 1, 2018, the Company will estimate the fair value of providing such loyalty program awards at the time the related awards are earned. As of the date of this Form 10-K, the Company expects to reduce its opening January 1, 2018 retained earnings balance (along with a corresponding credit to deferred revenue) by approximately $40 million to $50 million, before related tax effects, to give effect to this change in accounting for our loyalty program.

The Company is currently finalizing its review of ASU 2014-09 and its related ASU amendments with respect to required disclosures and financial statement presentation for fiscal 2018.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). ASU 2016-02 establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is evaluating the impact that ASU 2016-02 will have on its consolidated financial statements and related disclosures and believes that the significance of its future minimum rental payments will result in a material increase in ROU assets and lease liabilities.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The purpose of ASU 2016-15 is to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017, including interim periods within that year. The Company is evaluating the impact that ASU 2016-15 will have on its consolidated financial statements and related disclosures.

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which requires that an entity recognize the income tax consequences of intra-entity transfers of assets other than inventory at the time of the transfer instead of deferring the tax consequences until the asset has been sold to an outside party, as current U.S. GAAP requires. ASU 2016-16 is effective for annual periods, and interim periods therein, beginning after December 15, 2017. Early application is permitted in any interim or annual period. The Company is evaluating the impact that ASU 2016-16 will have on its consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The purpose of ASU 2017-01 is to clarify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. ASU 2017-01 is effective for fiscal years beginning after December 15, 2017, including interim periods within that year. The amendments in ASU 2017-01 should be applied prospectively on or after the effective date. Early adoption is permitted. The Company does not expect that the adoption of ASU 2017-01 will have a material impact on its consolidated financial statements and related disclosures.

In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, which is intended to simplify and amend the application of hedge accounting to more clearly portray the economics of an entity’s risk management strategies in its financial statements. ASU 2017-12 also amends the presentation and disclosure requirements and changes how entities assess hedge effectiveness. The effective date of the new standard for public companies is for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition with a cumulative effect adjustment recorded to opening retained earnings as of the initial adoption date. The Company is evaluating the impact that ASU 2017-12 will have on its consolidated financial statements and related disclosures.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Following the consummation of the Merger, the Company believes that its exposure to market risk is not material.

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Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The Board of Directors

Regal Entertainment Group:

Management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended.

Management, including our principal executive officer and principal financial officer, conducted an evaluation of the effectiveness of such controls as of December 31, ~~2016~~2017. This assessment was based on criteria for effective internal control over financial reporting described in the Internal Control - Integrated Framework (2013) by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment, our management believes that the Company's internal control over financial reporting is effective as of December 31, ~~2016~~2017.

KPMG LLP, independent registered public accounting firm of the Company's consolidated financial statements, has issued an audit report on the effectiveness of the Company's internal control over financial reporting as of December 31, ~~2016~~2017, as stated in their report which is included herein.



/s/ AMY E. MILES		/s/ DAVID H. OWNBY
Amy E. Miles		David H. Ownby
Chief Executive Officer (Principal Executive Officer)		Executive Vice President and Chief Financial Officer (Principal Financial Officer)

4033

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Report of Independent Registered Public Accounting Firm

~~The~~To the Stockholder and Board of Directors ~~and Stockholders~~

Regal Entertainment Group:

WeOpinions have audited the accompanying consolidated balance sheets of Regal Entertainment Group and subsidiaries as of December 31, 2016 and 2015, and the related consolidated statements of income, comprehensive income, deficit, and cash flows for each of the years in the three-year period ended December 31, 2016. We also have audited Regal Entertainment Group’s internal control over financial reporting as of December 31, 2016, based on ~~criteria established in Internal Control - Integrated Framework (2013) issued by~~ the ~~Committee~~Consolidated ofFinancial ~~Sponsoring~~Statements Organizations of the Treadway Commission (COSO). Regal Entertainment Group’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and ~~for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on~~ Internal Control ~~over~~Over Financial Reporting. ~~Our responsibility is to express an opinion on these consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.~~

We ~~conducted~~have ~~our~~audited ~~audits~~the inaccompanying ~~accordance~~consolidated ~~with~~balance ~~the~~sheets ~~standards~~ of ~~the~~Regal ~~Public~~Entertainment ~~Company~~Group ~~Accounting~~and ~~Oversight~~subsidiaries ~~Board~~ (~~United~~the ~~States~~Company). ~~Those~~as ~~standards~~of ~~require~~December 31, ~~that~~2017 ~~we plan~~ and ~~perform~~2016, the ~~audits~~related toconsolidated ~~obtain reasonable assurance about whether the financial~~ statements ~~are~~of ~~free~~income, ofcomprehensive ~~material~~income, ~~misstatement~~deficit, and ~~whether~~cash ~~effective~~flows ~~internal~~for ~~control~~each ~~over~~of ~~financial~~the ~~reporting~~years ~~was maintained~~ in ~~all material respects. Our audits of~~ the ~~consolidated~~three-year ~~financial~~period ~~statements~~ended ~~included examining~~December 31, ~~on a test basis~~2017, ~~evidence~~and ~~supporting~~ the ~~amounts~~related ~~and~~notes ~~disclosures~~(collectively, in the consolidated financial statements,). ~~assessing~~We ~~the~~also ~~accounting~~have ~~principles~~audited ~~used and significant estimates made by management, and evaluating~~ the ~~overall~~Company’s ~~financial statement presentation. Our audit of~~ internal control over financial reporting ~~included~~as ~~obtaining an understanding~~ of ~~internal control over financial reporting~~December 31, ~~assessing the risk that a material weakness exists~~2017, ~~and testing and evaluating the design and operating effectiveness of internal control~~ based on ~~the~~criteria ~~assessed~~established ~~risk.~~in ~~Our~~Internal ~~audits~~Control ~~also~~- ~~included~~Integrated ~~performing~~Framework ~~such~~(2013) ~~other~~issued ~~procedures~~by ~~as we considered necessary in~~ the ~~circumstances.~~Committee Weof ~~believe~~Sponsoring ~~that~~Organizations ~~our~~of ~~audits~~the ~~provide~~Treadway ~~a reasonable basis for our opinions~~Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2017, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Mangement’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Regal Entertainment Group and subsidiaries as of December 31, 2016 and 2015, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2016, in conformity with U.S. generally accepted accounting principles. Also in our opinion, Regal Entertainment Group maintained, in all material respects, effective internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

/s/ KPMG LLP

We have served as the Company’s auditor since 2001.

Knoxville, Tennessee

~~February~~March 271, ~~2017~~2018

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REGAL ENTERTAINMENT GROUP

CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

	December 31, 2016			December 31, 2015
	December 31, 2017			December 31, 2016
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	~~246~~228.58		$	~~219~~246.65
Trade and other receivables, net	~~155~~184.10			~~149~~155.61
Income tax receivable	—			3.5
Inventories	22.9			20.9
Inventories	20.9			22.4
Prepaid expenses and other current assets	27.6			24.4
Prepaid expenses and other current assets	23.4			20.9
TOTAL CURRENT ASSETS	463.3			446.9
Assets held for sale	1.0			1.0
Deferred income tax asset	—			21.2
TOTAL CURRENT ASSETS	446.9			438.2
PROPERTY AND EQUIPMENT:
Land	~~131~~154.28			~~132~~131.72
Buildings and leasehold improvements	2,~~319~~478.7			2,~~196~~319.47
Equipment	1,~~065~~083.74			1,~~058~~065.37
Construction in progress	2034.28			1820.2
Total property and equipment	3,~~536~~751.87			3,~~405~~536.68
Accumulated depreciation and amortization	(2,~~146~~238.75		)	(2,~~001~~146.47		)
TOTAL PROPERTY AND EQUIPMENT, NET	1,~~390~~513.12			1,~~404~~390.21
GOODWILL	~~327~~345.08			~~328~~327.70
INTANGIBLE ASSETS, NET	4643.06			5046.20
DEFERRED INCOME TAX ASSET	5654.35			3756.23
OTHER NON-CURRENT ASSETS	~~379~~422.45			~~343~~379.14
TOTAL ASSETS	$	2,~~645~~842.79		$	2,~~601~~645.67
LIABILITIES AND DEFICIT
CURRENT LIABILITIES:
Current portion of debt obligations	$	2526.56		$	2725.45
Accounts payable	~~194~~232.82			~~229~~194.78
Accrued expenses	7073.78			70.87
Deferred revenue	~~192~~186.72			~~203~~192.47
Income taxes payable	62.47			—6.4
Interest payable	19.9			20.0
Other current liabilities	39.9			31.2
TOTAL CURRENT LIABILITIES	~~510~~561.04			~~551~~521.3
LONG-TERM DEBT, LESS CURRENT PORTION	2,~~197~~339.14			2,197.61
LEASE FINANCING ARRANGEMENTS, LESS CURRENT PORTION	8474.85			7784.8
CAPITAL LEASE OBLIGATIONS, LESS CURRENT PORTION	6.97			86.9
NON-CURRENT DEFERRED REVENUE	~~412~~404.36			~~415~~412.23
OTHER NON-CURRENT LIABILITIES	~~273~~312.51			~~228~~262.42
TOTAL LIABILITIES	3,~~484~~698.67			3,~~479~~484.26
COMMITMENTS AND CONTINGENCIES
DEFICIT:
Class A common stock, $0.001 par value; 500,000,000 shares authorized, 133,080,279 and 132,745,481 shares issued and outstanding at December 31, 2016 and December 31, 2015, respectively	0.1			0.1
Class A common stock, $0.001 par value; 500,000,000 shares authorized, 133,306,994 and 133,080,279 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively	0.1			0.1
Class B common stock, $0.001 par value; 200,000,000 shares authorized, 23,708,639 shares issued and outstanding at December 31, 2016 and December 31, 2015	—			—
Class B common stock, $0.001 par value; 200,000,000 shares authorized, 23,708,639 shares issued and outstanding at December 31, 2017 and December 31, 2016	—			—
Preferred stock, $0.001 par value; 50,000,000 shares authorized; none issued and outstanding	—			—
Additional paid-in capital (deficit)	(~~934~~929.4		)	(~~940~~934.04		)
Retained earnings	9670.59			6496.25
Accumulated other comprehensive loss, net	(1.3		)	(2.1		)
Accumulated other comprehensive income (loss), net	2.5			(1.3		)
TOTAL STOCKHOLDERS' DEFICIT OF REGAL ENTERTAINMENT GROUP	(~~839~~855.19		)	(~~877~~839.81		)
Noncontrolling interest	0.21			0.2
TOTAL DEFICIT	(~~838~~855.98		)	(~~877~~838.69		)
TOTAL LIABILITIES AND DEFICIT	$	2,~~645~~842.79		$	2,~~601~~645.67

See accompanying notes to consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

CONSOLIDATED STATEMENTS OF INCOME

(in millions, except share and per share data)

	Year EndedDecember 31, 2016			Year EndedDecember 31, 2015			Year EndedJanuary 1, 2015
	Year EndedDecember 31, 2017			Year EndedDecember 31, 2016			Year EndedDecember 31, 2015
REVENUES:
Admissions	$	2,~~061~~008.71		$	2,~~038~~061.27		$	12,~~998~~038.92
Concessions	~~932~~930.62			~~901~~932.76			~~829~~901.67
Other operating revenues	~~202~~224.87			~~187~~202.48			~~161~~187.64
TOTAL REVENUES	3,~~197~~163.10			3,~~127~~197.31			23,~~990~~127.13
OPERATING EXPENSES:
Film rental and advertising costs	1,~~107~~067.38			1,~~093~~107.13			1,~~047~~093.1
Cost of concessions	~~119~~123.58			~~114~~119.45			~~111~~114.14
Rent expense	~~427~~426.68			~~421~~427.56			~~423~~421.45
Other operating expenses	~~883~~912.26			~~863~~883.72			~~813~~863.27
General and administrative expenses (including share-based compensation of $8.8, $8.3 and $9.4 for the years ended December 31, 2016, December 31, 2015 and January 1, 2015, respectively)	84.6			78.8			74.4
General and administrative expenses (including share-based compensation of $9.2, $8.8 and $8.3 for the years ended December 31, 2017, December 31, 2016 and December 31, 2015, respectively)	86.6			84.6			78.8
Depreciation and amortization	~~230~~249.7			~~216~~230.87			~~207~~216.28
Net loss on disposal and impairment of operating assets and other	424.80			194.78			719.37
TOTAL OPERATING EXPENSES	2,~~857~~891.73			2,~~808~~857.07			2,~~683~~808.70
INCOME FROM OPERATIONS	~~339~~271.47			~~319~~339.34			~~306~~319.43
OTHER EXPENSE (INCOME):
Interest expense, net	~~128~~125.1			~~129~~128.61			~~126~~129.56
Loss on extinguishment of debt	21.93			52.79			625.47
Earnings recognized from NCM	(2924.41		)	(3129.04		)	(3231.10		)
Equity in income of non-consolidated entities and other, net	(43.9		)	(38.3		)	(29.0		)
Gain on sale of Open Road Films investment	(17.8		)	—			—
TOTAL OTHER EXPENSE, NET	57.7			66.0			127.8
Equity in income of non-consolidated entities and other, net	(39.2		)	(43.9		)	(38.3		)
INCOME BEFORE INCOME TAXES	281.7			253.3			178.6
Merger related expenses	12.5			—			—
PROVISION FOR INCOME TAXES	111.2			100.1			73.4
TOTAL OTHER EXPENSE, NET	57.8			57.7			66.0
NET INCOME	170.5			153.2			105.2
INCOME BEFORE INCOME TAXES	213.9			281.7			253.3
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTEREST, NET OF TAX	(0.1		)	0.2			0.4
PROVISION FOR INCOME TAXES	101.6			111.2			100.1
NET INCOME ATTRIBUTABLE TO CONTROLLING INTEREST	$	170.4		$	153.4		$	105.6
NET INCOME	112.3			170.5			153.2
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTEREST, NET OF TAX	—			(0.1		)	0.2
NET INCOME ATTRIBUTABLE TO CONTROLLING INTEREST	$	112.3		$	170.4		$	153.4
EARNINGS PER SHARE OF CLASS A AND CLASS B COMMON STOCK (NOTE 12):
Basic	$	10.0972		$	01.9909		$	0.6899
Diluted	$	10.0972		$	01.9809		$	0.6898
AVERAGE SHARES OUTSTANDING (in thousands):
Basic	~~155~~156,~~995~~336			155,~~680~~995			155,~~287~~680
Diluted	156,~~804~~986			156,~~511~~804			156,~~310~~511
DIVIDENDS DECLARED PER COMMON SHARE	$	0.88		$	0.88		$	10.88

See accompanying notes to consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

	Year EndedDecember 31, 2016			Year EndedDecember 31, 2015			Year EndedJanuary 1, 2015
	Year EndedDecember 31, 2017			Year EndedDecember 31, 2016			Year EndedDecember 31, 2015
NET INCOME	$	~~170~~112.53		$	~~153~~170.25		$	~~105~~153.2
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX
Change in fair value of interest rate swap transactions	(2.30		)	(42.3		)	(24.13		)
Amounts reclassified to net income from interest rate swaps	31.6			43.56			34.25
Change in fair value of available for sale securities	—			~~(0.2~~—		)	1(0.12		)
Reclassification adjustment for gain on sale of available for sale securities recognized in net income	~~(0.5~~—		)	—(0.5		)	~~(0.6~~—		)
Change in fair value of equity method investee interest rate swaps	—0.2			~~(0.6~~—		)	(0.76		)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX	03.8			(0.68		)	(0.96		)
TOTAL COMPREHENSIVE INCOME, NET OF TAX	~~171~~116.31			~~152~~171.63			~~106~~152.16
Comprehensive (income) loss attributable to noncontrolling interest, net of tax	~~(0.1~~—		)	(0.21		)	0.42
COMPREHENSIVE INCOME ATTRIBUTABLE TO CONTROLLING INTEREST, NET OF TAX	$	~~171~~116.21		$	~~152~~171.82		$	~~106~~152.58

See accompanying notes to consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

CONSOLIDATED STATEMENTS OF DEFICIT

(in millions, except amounts of cash dividends declared per share)

	Class ACommon Stock				Class BCommon Stock			AdditionalPaid-InCapital(Deficit)			RetainedEarnings			AccumulatedOtherComprehensiveIncome (Loss)			Total Stockholders'Deficit of RegalEntertainmentGroup			NoncontrollingInterest			TotalDeficit
	Shares		Amount		Shares	Amount
Balances, December 26, 2013	132.1		$	0.1	23.7	$	—	$	(782.9	)	$	71.8		$	(2.4	)	$	(713.4	)	$	(1.9	)	$	(715.3	)
Balances, January 1, 2015	132.5		$	0.1	23.7	$	—	$	(941.8	)	$	48.4		$	(1.5	)	$	(894.8	)	$	(2.5	)	$	(897.3	)
Net income attributable to controlling interest	—		—		—	—		—			105.6			—			105.6			—			105.6
Other comprehensive income (loss)	—		—		—	—		—			—			0.9			0.9			—			0.9
Noncontrolling interest adjustments	—		—		—	—		—			—			—			—			(0.6		)	(0.6		)
Share-based compensation expense	—		—		—	—		7.9			—			—			7.9			—			7.9
Exercise of stock options	—		—		—	—		0.1			—			—			0.1			—			0.1
Tax benefits from exercise of stock options, vesting of restricted stock and other	(0.2	)	—		—	—		(2.3		)	—			—			(2.3		)	—			(2.3		)
Issuance of restricted stock	0.6		—		—	—		—			—			—			—			—			—
Extraordinary cash dividend declared, $1.00 per share	—		—		—	—		(156.2		)	—			—			(156.2		)	—			(156.2		)
Cash dividends declared, $0.88 per share	—		—		—	—		(8.4		)	(129.0		)	—			(137.4		)	—			(137.4		)
Balances, January 1, 2015	132.5		0.1		23.7	—		(941.8		)	48.4			(1.5		)	(894.8		)	(2.5		)	(897.3		)
Net income attributable to controlling interest	—		—		—	—		—			153.4			—			153.4			—			153.4
Other comprehensive income (loss)	—		—		—	—		—			—			(0.6		)	(0.6		)	—			(0.6		)
Purchase of noncontrolling interest	—		—		—	—		(5.5		)	—			—			(5.5		)	2.9			(2.6		)
Other noncontrolling interest adjustments	—		—		—	—		—			—			—			—			(0.2		)	(0.2		)
Share-based compensation expense	—		—		—	—		7.7			—			—			7.7			—			7.7
Tax benefits from vesting of restricted stock and other	(0.3	)	—		—	—		(0.3		)	—			—			(0.3		)	—			(0.3		)
Issuance of restricted stock	0.5		—		—	—		—			—			—			—			—			—
Cash dividends declared, $0.88 per share	—		—		—	—		(0.1		)	(137.6		)	—			(137.7		)	—			(137.7		)
Balances, December 31, 2015	132.7		0.1		23.7	—		(940.0		)	64.2			(2.1		)	(877.8		)	0.2			(877.6		)
Net income attributable to controlling interest	—		—		—	—		—			170.4			—			170.4			—			170.4
Other comprehensive income (loss)	—		—		—	—		—			—			0.8			0.8			—			0.8
Share-based compensation expense	—		—		—	—		7.9			—			—			7.9			—			7.9
Tax benefits from vesting of restricted stock and other	(0.1	)	—		—	—		(2.3		)	—			—			(2.3		)	—			(2.3		)
Issuance of restricted stock	0.5		—		—	—		—			—			—			—			—			—
Cash dividends declared, $0.88 per share	—		—		—	—		—			(138.1		)	—			(138.1		)	—			(138.1		)
Balances, December 31, 2016	133.1		$0.1	~~0.1~~	23.7	$—	—	$(934.4	~~(934.4~~	)	$96.5	~~96.5~~		$(1.3	~~(1.3~~	)	$(839.1	~~(839.1~~	)	$0.2	~~0.2~~		$(838.9	~~(838.9~~	)
Net income attributable to controlling interest	—		—		—	—		—			112.3			—			112.3			—			112.3
Other comprehensive income (loss)	—		—		—	—		—			—			3.8			3.8			—			3.8
Other noncontrolling interest adjustments	—		—		—	—		—			—			—			—			(0.1		)	(0.1		)
Share-based compensation expense	—		—		—	—		8.6			—			—			8.6			—			8.6
Tax benefits from vesting of restricted stock and other	(0.2	)	—		—	—		(3.6		)	0.3			—			(3.3		)	—			(3.3		)
Issuance of restricted stock	0.4		—		—	—		—			—			—			—			—			—
Cash dividends declared, $0.88 per share	—		—		—	—		—			(138.2		)	—			(138.2		)	—			(138.2		)
Balances, December 31, 2017	133.3		$	0.1	23.7	$	—	$	(929.4	)	$	70.9		$	2.5		$	(855.9	)	$	0.1		$	(855.8	)

See accompanying notes to consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

	Year EndedDecember 31, 2016			Year EndedDecember 31, 2015			Year EndedJanuary 1, 2015
	Year EndedDecember 31, 2017			Year EndedDecember 31, 2016			Year EndedDecember 31, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	~~170~~112.53		$	~~153~~170.25		$	~~105~~153.2
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	~~230~~249.7			~~216~~230.87			~~207~~216.28
Amortization of debt discount	0.3			0.3			—0.3
Amortization of debt acquisition costs	4.68			4.76			4.87
Share-based compensation expense	89.82			8.38			98.43
Deferred income tax provision (benefit)	2(0.46		)	~~(10~~2.94		)	6(10.69		)
Net loss on disposal and impairment of operating assets	14.6			19.7			7.3
Net loss on disposal and impairment of operating assets and other	24.0			14.6			19.7
Gain on lease termination	~~(9.8~~—		)	—(9.8		)	—
Equity in income of non-consolidated entities	(5141.42		)	(4451.64		)	(3444.16		)
Loss on extinguishment of debt	2.9			5.7			62.4
Gain on sale of Open Road Films investment	(17.8		)	—			—
Gain on sale of available for sale securities	(1.0		)	—			(2.0		)
Proceeds from business interruption insurance claim	0.3			—			—
Non-cash (gain) loss on interest rate swaps	(0.1		)	0.7			—
Loss on extinguishment of debt	1.3			2.9			5.7
Non-cash rent income	(6.3		)	(6.2		)	(4.0		)
Gain on sale of available for sale securities	—			(1.0		)	—
Cash distributions on investments in other non-consolidated entities	12.0			3.6			6.3
Non-cash (gain) loss on interest rate swaps	(0.6		)	(0.1		)	0.7
Excess cash distribution on NCM shares	13.8			15.4			14.1
Non-cash rent income	(7.0		)	(6.3		)	(6.2		)
Landlord contributions	75.3			32.2			8.8
Cash distributions on investments in other non-consolidated entities	12.3			12.0			3.6
Proceeds from lease termination and other	10.6			—			—
Excess cash distribution on NCM shares	15.6			13.8			15.4
Landlord contributions	91.8			75.3			32.2
Proceeds from litigation settlement	1.9			—			—
Proceeds from lease termination and other	—			10.6			—
Changes in operating assets and liabilities, net of effects of acquisitions:
Trade and other receivables	—(27.7		)	~~(19.0~~—		)	(419.20		)
Inventories	(1.53		)	(41.75		)	1(4.37		)
Prepaid expenses and other assets	(23.56		)	1(2.5		)	(1.85		)
Accounts payable	~~(38~~31.31		)	63(38.13		)	(063.21		)
Income taxes payable	6(3.78		)	06.27			0.32
Deferred revenue	(2320.65		)	3(23.6		)	~~(6.~~3.6		)
Accrued expenses and other liabilities	(1120.26		)	(911.2		)	(329.02		)
NET CASH PROVIDED BY OPERATING ACTIVITIES	~~410~~409.59			~~434~~410.45			~~349~~434.14
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(~~214~~250.94		)	(~~185~~214.79		)	(~~156~~185.87		)
Proceeds from disposition of assets	116.41			121.04			112.70
Investment in non-consolidated entities	(1311.79		)	(013.47		)	(4.0.4		)
Cash used for acquisition	—			(9.2		)	—
Net cash used for acquisitions	(171.6		)	—			(9.2		)
Proceeds from sale of available for sale securities	3.6			—			6.0
Proceeds from sale of Open Road Films investment	10.3			—			—
Changes in other long-term assets	—			—			2.7
Proceeds from sale of available for sale securities	—			3.6			—
NET CASH USED IN INVESTING ACTIVITIES	(223.6		)	(183.3		)	(150.4		)
Change in other long-term assets	(3.1		)	—			—
NET CASH USED IN INVESTING ACTIVITIES	(410.6		)	(223.6		)	(183.3		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash used to pay dividends	(138.9		)	(~~139~~138.19		)	(~~294~~139.81		)
Payments on long-term obligations	(2123.75		)	(2321.37		)	(2923.73		)
Landlord contributions received from lease financing arrangements	62.05			36.90			—3.9
Proceeds from stock option exercises	—			—			0.1
Cash paid for tax withholdings and other	(3.7		)	(3.3		)	(4.4		)
Cash paid for tax withholdings and other	(3.3		)	(4.4		)	(3.9		)
Proceeds from Amended Senior Credit Facility	1,103.7			1,914.6			963.3
Proceeds from Amended Senior Credit Facility	1,914.6			963.3			—
Payoff of Amended Senior Credit Facility	(953.7		)	(1,914.6		)	(963.2		)
Repayment of Amended Senior Credit Facility	(1,914.6		)	(963.2		)	—
Payment of debt acquisition costs	(3.4		)	(2.1		)	(13.2		)
Proceeds from issuance of Regal 53/4% Senior Notes Due 2022	—			—			775.0
Purchase of noncontrolling interest	—			—			(2.6		)
Cash used to repurchase 91/8% Senior Notes	—			—			(336.3		)
NET CASH USED IN FINANCING ACTIVITIES	(17.0		)	(160.0		)	(178.6		)
Cash used to repurchase 85/8% Senior Notes	—			—			(428.0		)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(17.7		)	26.9			72.5
Payment of debt acquisition costs	(2.1		)	(13.2		)	(14.9		)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	246.5			219.6			147.1
Purchase of noncontrolling interest	—			(2.6		)	—
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	228.8		$	246.5		$	219.6
NET CASH USED IN FINANCING ACTIVITIES	(160.0		)	(178.6		)	(332.5		)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	26.9			72.5			(133.8		)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	219.6			147.1			280.9
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	246.5		$	219.6		$	147.1
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income taxes	$	~~101~~105.9		$	~~105~~101.9		$	69105.09
Cash paid for interest, net of amounts capitalized	$	~~124~~121.34		$	~~125~~124.3		$	~~141~~125.03
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES:
Investment in NCM	$	96.93		$	9.09		$	5.9.0
Increase in property and equipment and other from lease financing arrangements	$	133.12		$	313.21		$	143.2

See accompanying notes to consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, ~~2016~~2017, December 31, ~~2015~~2016, and ~~January~~December 131, 2015

1. THE COMPANY AND BASIS OF PRESENTATION

Regal Entertainment Group (the "Company," "Regal," "we" or "us") is the parent company of Regal Entertainment Holdings, Inc. ("REH"), which is the parent company of Regal Cinemas Corporation ("Regal Cinemas") and its subsidiaries. Regal Cinemas' subsidiaries include Regal Cinemas, Inc. ("RCI") and its subsidiaries, which include Edwards Theatres, Inc. ("Edwards") and United Artists Theatre Company ("United Artists"). The terms Regal or the Company, REH, Regal Cinemas, RCI, Edwards and United Artists shall be deemed to include the respective subsidiaries of such entities when used in discussions included herein regarding the current operations or assets of such entities. Certain amounts in prior fiscal years have been reclassified to conform with the presentation adopted in the current year.

Regal operates one of the largest and most geographically diverse theatre circuits in the United States, consisting of 7,~~267~~322 screens in ~~561~~560 theatres in 4243 states along with Guam, Saipan, American Samoa and the District of Columbia as of December 31, ~~2016~~2017. ~~Beginning~~ ~~January 2, 2015, the Company's fiscal year changed from a 52-53 week fiscal year ending on the first Thursday after December 25 of each year to a fiscal year ending on December 31 of each year.~~

During 2001 and 2002, Anschutz Company and its subsidiaries ("Anschutz") acquired controlling equity interests in United Artists, Edwards and RCI upon each of the entities' emergence from bankruptcy reorganization. In May 2002, the Company sold 18.0 million shares of its Class A common stock in an initial public offering at a price of $19.00 per share, receiving aggregate net offering proceeds, net of underwriting discounts, commissions and other offering expenses, of $314.8 million. In 2015, as a result of an internal restructuring, Anschutz Company changed its name to The Anschutz Corporation.

~~Certain~~On ~~amounts~~December 5, 2017, Regal entered into an Agreement and Plan of Merger (the "Merger Agreement") with Cineworld Group plc, a public limited company incorporated in ~~prior~~England ~~fiscal~~and ~~years~~Wales ~~have~~("Cineworld"), ~~been~~Crown ~~reclassified~~Intermediate Holdco, Inc., a Delaware corporation and an indirect wholly owned subsidiary of Cineworld ("US Holdco"), and Crown Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of US Holdco (the "Merger Sub"). The Merger Agreement provides, subject to ~~conform~~its ~~with~~terms and conditions, for the ~~presentation~~acquisition ~~adopted~~of Regal by Cineworld at a price of $23.00 in cash for each share of Regal’s Class A common stock and Class B common stock (each, a "Share"), without interest and subject to deduction for any required withholding tax (the ~~current~~"Merger ~~year~~Consideration"), through the merger of the Merger Sub with and into Regal (the "Merger"), with Regal surviving the Merger as a wholly owned, indirect subsidiary of Cineworld. Regal’s Board of Directors unanimously approved the Merger and the Merger Agreement and recommended that stockholders adopt the Merger Agreement. See Note 16—"Subsequent Events," for further developments occurring after December 31, 2017 with respect to the Merger.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Regal and its subsidiaries. Majority-owned subsidiaries that the Company controls are consolidated while those affiliates of which the Company owns between 20% and 50% and does not control are accounted for under the equity method. Those affiliates of which the Company owns less than 20% are generally accounted for under the cost method, unless the Company is deemed to have the ability to exercise significant influence over the affiliate, in which case the Company would account for its investment under the equity method. The results of these subsidiaries and affiliates are included in the consolidated financial statements effective with their formation or from their dates of acquisition. All significant intercompany accounts and transactions have been eliminated in consolidation.

Revenue Recognition

Revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit card at the point of sale. Other operating revenues consist primarily of product advertising (including vendor marketing programs) and other ancillary revenues that are recognized as income in the period earned. The Company generally recognizes payments received attributable to the marketing and advertising services provided by the Company under certain vendor programs as revenue in the periods in which the advertising is displayed or when the related impressions are delivered. Such impressions are measured by the concession product sales volume, which is a mutually agreed upon proxy of attendance and reflects the Company's marketing and advertising services delivered to its vendors. In instances where the consideration received is in excess of fair value of the advertising services provided, the excess is recorded as a reduction of concession costs.

The Company maintains a deferred revenue balance pertaining to amounts received for agreeing to the 2007 National CineMedia exhibitor services agreement ("ESA") modification, amounts recorded in connection with the receipt of newly issued common units of National CineMedia pursuant to the provisions of the Common Unit Adjustment Agreement described in Note 4—"Investments," and amounts received from the sale of bulk tickets and gift cards that have not been redeemed. Amortization of deferred revenue related to the amount we received for agreeing to the existing National CineMedia exhibitor services agreement modification and amounts recorded in connection with the receipt of newly issued common units of National CineMedia pursuant to the provisions of the Common Unit Adjustment Agreement are described below in this Note 2 under "Deferred Revenue" and in Note 4—"Investments." The Company recognizes revenue associated with bulk tickets and gift cards when redeemed, or when the likelihood of redemption becomes remote. The determination of the likelihood of redemption is based on an analysis of actual historical redemption trends. 41

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

Cash Equivalents

The Company considers all unrestricted highly liquid debt instruments and investments purchased with an original maturity of 3 months or less to be cash equivalents. At December 31, ~~2016~~2017, the Company held substantially all of its cash in temporary cash investments in the form of certificates of deposit and variable rate investment accounts with major financial institutions.

Inventories

Inventories consist of concession products and theatre supplies. The Company states inventories on the basis of first-in, first-out (FIFO) cost, which is not in excess of net realizable value.

Property and Equipment

The Company states property and equipment at cost. Major renewals and improvements are capitalized, while maintenance and repairs that do not improve or extend the lives of the respective assets are expensed currently. Gains and losses from disposition of property and equipment are included in income and expense when realized.

The Company capitalizes the cost of computer equipment, system hardware and purchased software ready for service. During the years ended December 31, ~~2016~~2017 and December 31, ~~2015~~2016, the Company capitalized approximately $814.03 million and $128.60 million, respectively, of such costs, which were associated primarily with (i) new point-of-sale devices at the Company's box offices and concession stands, (ii) new ticketing kiosks, and (iii) computer hardware and software purchased for the Company's theatre locations and corporate office. The Company also capitalizes certain direct external costs associated with software developed for internal use after the preliminary software project stage is completed and Company management has authorized further funding for a software project and it is deemed probable of completion. The Company capitalizes these external software development costs only until the point at which the project is substantially complete and the software is ready for its intended purpose.

The Company records depreciation and amortization using the straight-line method over the following estimated useful lives:



Buildings		20 - 30 years
Equipment		3 - 20 years
Leasehold improvements		Lesser of term of lease or asset life
Computer equipment and software		3 - 5 years

As of December 31, ~~2016~~2017 and December 31, ~~2015~~2016, included in property and equipment is $~~190~~189.63 million and $~~185~~190.96 million of assets accounted for under capital leases and lease financing arrangements, before accumulated depreciation of $~~118~~128.06 million and $~~104~~118.10 million, respectively. The Company records amortization using the straight-line method over the shorter of the lease terms or the estimated useful lives noted above.

~~Impairment of Long-Lived Assets~~42

The Company reviews long-lived assets (including intangible assets, marketable equity securities and investments in non-consolidated entities as described further below) for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. The Company generally evaluates assets for impairment on an individual theatre basis, which management believes is the lowest level for which there are identifiable cash flows. If the sum of the expected future cash flows, undiscounted and without interest charges, is less than the carrying amount of the assets, the Company recognizes an impairment charge in the amount by which the carrying value of the assets exceeds their fair market value.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~continuing~~Impairment ~~use until the expected disposal date or the fair value~~ of ~~furniture,~~Long-Lived fixtures and equipment. The expected disposal date does not exceed the remaining lease period unless it is probable the lease period will be extended and may be less than the remaining lease period when the Company does not expect to operate the theatre to the end of its lease term. The fair value of assets is determined using the present value of the estimated future cash flows or the expected selling price less selling costs for assets of which the Company expects to dispose. Significant judgment is involved in determining whether a triggering event has occurred, estimating future cash flows and determining fair value. Management's estimates (Level 3 inputs as described in FASB Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures) are based on historical and projected operating performance, recent market transactions, and current industry trading multiples.Assets

~~Triggering~~The Company reviews long-lived assets (including intangible assets, marketable equity securities and investments in non-consolidated entities as described further below) for impairment whenever events ~~identified~~or ~~resulted~~changes in circumstances indicate that the ~~recording~~carrying amounts of ~~impairment~~the ~~charges~~assets ofmay ~~$9.6~~not ~~million,~~be ~~$15~~fully recoverable.6 ~~million~~The ~~and~~Company ~~$5.6~~generally ~~million~~evaluates assets for ~~the~~impairment ~~years~~on ~~ended~~an ~~December 31,~~individual ~~2016,~~theatre ~~December 31~~basis, ~~2015~~which ~~and~~management ~~January 1,~~believes ~~2015,~~is ~~respectively.~~the ~~The~~lowest ~~long-lived~~level ~~asset~~for ~~impairment~~which ~~charges~~there ~~recorded~~are ~~during~~identifiable ~~each~~cash flows. If the sum of the ~~periods~~expected ~~presented~~future ~~are~~cash ~~specific~~flows, toundiscounted ~~theatres~~and ~~that~~without ~~were~~interest ~~directly~~charges, ~~and~~is ~~individually~~less ~~impacted~~than bythe ~~increased~~carrying ~~competition,~~amount ~~adverse~~of ~~changes~~the inassets, ~~market~~the ~~demographics~~Company orrecognizes ~~adverse~~an ~~changes~~impairment charge in the ~~development~~amount orby which the ~~conditions~~carrying value of the ~~areas~~assets ~~surrounding~~exceeds ~~the~~their ~~theatre~~fair market value.

The Company considers historical theatre level cash flows, estimated future theatre level cash flows, theatre property and equipment carrying values, intangible asset carrying values, the age of the theatre, competitive theatres in the marketplace, the impact of recent pricing changes, strategic initiatives, available lease renewal options and other factors considered relevant in its assessment of whether or not a triggering event has occurred that indicates impairment of individual theatre assets may be necessary. For theatres where a triggering event is identified, impairment is measured based on the estimated cash flows from continuing use until the expected disposal date or the fair value of furniture, fixtures and equipment. The expected disposal date does not exceed the remaining lease period unless it is probable the lease period will be extended and may be less than the remaining lease period when the Company does not expect to operate the theatre to the end of its lease term. The fair value of assets is determined using the present value of the estimated future cash flows or the expected selling price less selling costs for assets of which the Company expects to dispose. Significant judgment is involved in determining whether a triggering event has occurred, estimating future cash flows and determining fair value. Management's estimates (Level 3 inputs as described in FASB Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures) are based on historical and projected operating performance, recent market transactions, and current industry trading multiples.

The Company's analysis relative to long-lived assets resulted in the recording of impairment charges of $13.5 million, $7.9 million and $15.6 million for the years ended December 31, 2017, December 31, 2016 and December 31, 2015, respectively. The long-lived asset impairment charges recorded were specific to theatres that were directly and individually impacted by increased competition, adverse changes in market demographics or adverse changes in the development or the conditions of the areas surrounding the theatres we deemed other than temporary.

Leases

The majority of the Company's operations are conducted in premises occupied under non-cancelable lease agreements with initial base terms generally ranging from 15 to 20 years. The Company, at its option, can renew a substantial portion of the leases at defined or then fair rental rates for various periods. Certain leases for our theatres provide for contingent rentals based on the revenue results of the underlying theatre and require the payment of taxes, insurance, and other costs applicable to the property. Also, certain leases contain escalating minimum rental provisions. There are no conditions imposed upon us by our lease agreements or by parties other than the lessor that legally obligate the Company to incur costs to retire assets as a result of a decision to vacate our leased properties. None of our lease agreements require us to return the leased property to the lessor in its original condition (allowing for normal wear and tear) or to remove leasehold improvements at our cost.

The Company accounts for leased properties under the provisions of ASC Topic 840, Leases and other authoritative accounting literature. ASC Subtopic 840-10, Leases—Overview requires that the Company evaluate each lease for classification as either a capital lease or an operating lease. The Company performs this evaluation at the inception of the lease and when a modification is made to a lease. As to those arrangements that are classified as capital leases, the Company records property under capital leases and a capital lease obligation in an amount equal to the lesser of the present value of the minimum lease payments to be made over the life of the lease at the beginning of the lease term, or the fair value of the leased property. The property under capital lease is amortized on a straight-line basis as a charge to expense over the lease term, as defined, or the economic life of the leased property, whichever is less. During the lease term, as defined, each minimum lease payment is allocated between a reduction of the lease obligation and interest expense so as to produce a constant periodic rate of interest on the remaining balance of the lease obligation. The Company does not believe that exercise of the renewal options in its leases are reasonably assured at the inception of the lease agreements because such leases: (i) provide for either (a) renewal rents based on market rates or (b) renewal rents that equal or exceed the initial rents, and (ii) do not impose economic penalties upon the determination whether or not to exercise the renewal option. As a result, there are not sufficient economic incentives at the inception of the leases to consider the lease renewal options to be reasonably assured of being exercised and therefore, the initial base term is generally considered as the lease term under ASC Subtopic 840-10.

The Company records rent expense for its operating leases with contractual rent increases in accordance with ASC Subtopic 840-20, Leases—Operating Leases, on a straight-line basis from the "lease commencement date" as specified in the lease agreement until the end of the base lease term.43

The Company accounts for lease incentive payments received from a landlord in accordance with ASC Subtopic 840-20, Leases—Lease Incentives, and records the proceeds as a deferred lease incentive liability and amortizes the liability as a reduction in rent expense over the base term of the lease.

For leases in which the Company is involved with construction of the theatre, the Company accounts for the lease during the construction period under the provisions of ASC Subtopic 840-40, Leases—Sale-Leaseback Transactions. The landlord is typically responsible for constructing a theatre using guidelines and specifications agreed to by the Company and assumes substantially all of the risk of construction. In accordance with ASC Subtopic 840-40, if the Company concludes that it has substantially all of the construction period risks, it records a construction asset and related liability for the amount of total project costs incurred during the construction period. Once construction is completed, the Company considers the requirements

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~under~~The ~~ASC~~Company ~~Subtopic~~records ~~840-40,~~rent expense for ~~sale-leaseback~~its ~~treatment,~~operating ~~and~~leases ifwith ~~the~~contractual ~~arrangement~~rent ~~does~~increases ~~not~~in ~~meet~~accordance ~~such~~with ~~requirements,~~ASC itSubtopic ~~records~~840-20, ~~the~~Leases—Operating ~~project's~~Leases, ~~construction~~on ~~costs~~a ~~funded~~straight-line bybasis from the ~~landlord~~"lease ascommencement adate" ~~financing~~as ~~obligation.~~specified ~~The~~in ~~obligation~~the islease ~~amortized~~agreement ~~over~~until the ~~financing~~end ~~term~~of ~~based on~~ the ~~payments~~base ~~designated~~lease ~~in the contract~~term.

InThe ~~accordance~~Company ~~with~~accounts ~~ASC Subtopic 840-20, we expense rental costs incurred during construction periods~~ for ~~operating~~lease ~~leases~~incentive aspayments ~~such~~received ~~costs~~from ~~are~~a ~~incurred.~~landlord ~~For~~in ~~rental~~accordance ~~costs~~with ~~incurred~~ASC ~~during~~Subtopic ~~construction~~840-20, ~~periods~~Leases—Lease ~~for~~Incentives, ~~both operating~~ and ~~capital~~records ~~leases,~~ the ~~"lease~~proceeds ~~commencement~~as ~~date"~~a isdeferred ~~the~~lease ~~date~~incentive atliability ~~which we gain access to the leased asset. Historically,~~ and ~~for~~amortizes the ~~years~~liability ~~ended~~as ~~December 31,~~a ~~2016,~~reduction ~~December 31,~~in ~~2015~~rent ~~and~~expense ~~January 1,~~over ~~2015,~~the ~~these~~base ~~rental~~term ~~costs~~of ~~have~~the ~~not been significant to our consolidated financial statements~~lease.

In accordance with ASC Subtopic 840-20, we expense rental costs incurred during construction periods for operating leases as such costs are incurred. For rental costs incurred during construction periods for both operating and capital leases, the "lease commencement date" is the date at which we gain access to the leased asset. Historically, and for the years ended December 31, 2017, December 31, 2016 and December 31, 2015, these rental costs have not been significant to our consolidated financial statements.

Sale and Leaseback Transactions

The Company accounts for the sale and leaseback of real estate assets in accordance with ASC Subtopic 840-40. Losses on sale leaseback transactions are recognized at the time of sale if the fair value of the property sold is less than the undepreciated cost of the property. Gains on sale and leaseback transactions are deferred and amortized over the remaining lease term.

Goodwill

The carrying amount of goodwill at December 31, ~~2016~~2017 and December 31, ~~2015~~2016 was approximately $~~327~~345.08 million and $~~328~~327.70 million, respectively. The $18.8 million net increase in goodwill during year ended December 31, 2017 was primarily attributable to $26.2 million of goodwill recorded in connection with the Company's acquisitions of nine theatres with 134 screens, which are more fully described in Note 3—"Acquisitions," partially offset by a $7.3 million impairment charge to one of the Company’s reporting units as described below. The Company evaluates goodwill for impairment annually or more frequently as specific events or circumstances dictate. Under ASC Subtopic 350-20, Intangibles—-Goodwill and Other—-Goodwill, the Company has identified its reporting units to be the designated market areas in which the Company conducts its theatre operations. Goodwill impairment is evaluated using aan ~~two-step~~ approach requiring the Company to compute the fair value of a reporting unit and compare it with its carrying value. In IfJanuary 2017, the ~~carrying~~FASB ~~value~~issued ofASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the ~~reporting~~Test ~~unit~~for ~~exceeds~~Goodwill ~~its~~Impairment. ~~estimated~~The ~~fair~~purpose ~~value,~~of aASU 2017-04 was to simplify the subsequent measurement of goodwill by removing the second step isof ~~performed~~the totwo-step ~~measure~~impairment ~~the~~test. ~~potential~~The Company early adopted ASU 2017-04 in connection with its interim goodwill impairment test performed during the quarter ended September 30, 2017 as further described below. The Company determines fair value by using an enterprise valuation methodology determined by applying multiples to cash flow estimates less net indebtedness, which the Company believes is an appropriate method to determine fair value. There is considerable management judgment with respect to cash flow estimates and appropriate multiples and discount rates to be used in determining fair value and such management estimates fall under Level 3 within the fair value measurement hierarchy.

As part of the Company’s ongoing operations, we may close certain theatres within a reporting unit containing goodwill due to underperformance of the theatre or inability to renew our lease, among other reasons. Additionally, we generally abandon certain assets associated with a closed theatre, primarily leasehold improvements. Under ASC Topic 350, Intangibles—Goodwill and Other, when a portion of a reporting unit that constitutes a business is disposed of, goodwill associated with that business shall be included in the carrying amount of the business in determining the gain or loss on disposal. We evaluate whether the portion of a reporting unit being disposed of constitutes a business on the date of closure. Generally, on the date of closure, the closed theatre does not constitute a business because the Company retains assets and processes on that date essential to the operation of the theatre. These assets and processes are significant missing elements impeding the operation of a business. Accordingly, when closing individual theatres, we generally do not include goodwill in the calculation of any gain or loss on disposal of the related assets.

The Company's annual goodwill impairment assessment for the year ended December 31, 2016 indicated that the carrying value of one of its reporting units exceeded its estimated fair value and as a result, the Company recorded a goodwill impairment charge of approximately $1.7 million. The Company's annual goodwill impairment assessments for the years ended December 31, 2015 and January 1, 2015 indicated that the estimated fair value of each of its reporting units exceeded their carrying value and therefore, goodwill was not deemed to be impaired.44

Intangible Assets

As of December 31, 2016 and December 31, 2015, intangible assets totaled $66.8 million and $67.1 million, respectively, before accumulated amortization of $20.8 million and $16.9 million, respectively. Such intangible assets are recorded at fair value and are amortized on a straight-line basis over the estimated remaining useful lives of the assets. The Company's identifiable intangible assets substantially consist of favorable leases acquired in connection with various acquisitions since fiscal 2008. During the years ended December 31, 2016, December 31, 2015 and January 1, 2015, the Company recognized $3.8 million, $3.7 million and $3.7 million of amortization, respectively, related to these intangible assets.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~Estimated~~business ~~amortization~~shall ~~expense~~be ~~for~~included in the ~~next~~carrying ~~five~~amount ~~fiscal~~of ~~years~~the ~~for~~business ~~such~~in ~~intangible~~determining the gain or loss on disposal. We evaluate whether the portion of a reporting unit being disposed of constitutes a business on the date of closure. Generally, on the date of closure, the closed theatre does not constitute a business because the Company retains assets asand processes on that date essential to the operation of ~~December 31~~the theatre. These assets and processes are significant missing elements impeding the operation of a business. Accordingly, ~~2016~~when isclosing ~~projected~~individual ~~below~~theatres, (we generally do not include goodwill in ~~millions):~~the calculation of any gain or loss on disposal of the related assets.

2017	$	3.8
2018	3.8
2019	3.7
2020	3.5
2021	3.3

The Company evaluates goodwill for impairment annually or more frequently as specific events or circumstances dictate. After considering various industry specific factors, the Company conducted an interim goodwill impairment assessment during the quarter ended September 30, 2017, which indicated that the carrying value of one of its reporting units exceeded its estimated fair value. As a result, the Company recorded a goodwill impairment charge of approximately $7.3 million. The Company's annual goodwill impairment assessment for the year ended December 31, 2016 indicated that the carrying value of one of its reporting units exceeded its estimated fair value and as a result, the Company recorded a goodwill impairment charge of approximately $1.7 million. The Company's annual goodwill impairment assessment for the year ended December 31, 2015 indicated that the estimated fair value of each of its reporting units exceeded their carrying value and therefore, goodwill was not deemed to be impaired.

~~During~~Intangible the year ended December 31, 2016, the Company recorded a favorable lease impairment charge of approximately $0.3 million related to a theatre closure. The Company did not record an impairment of any intangible assets during the years ended December 31, 2015 or January 1, 2015. Assets

As of December 31, 2017 and December 31, 2016, intangible assets totaled $69.6 million and $66.8 million, respectively, before accumulated amortization of $26.0 million and $20.8 million, respectively. Such intangible assets are recorded at fair value and are amortized on a straight-line basis over the estimated remaining useful lives of the assets. The Company's identifiable intangible assets substantially consist of favorable leases acquired in connection with various acquisitions since fiscal 2008. During the years ended December 31, 2017, December 31, 2016 and December 31, 2015, the Company recognized $3.8 million, $3.8 million and $3.7 million of amortization, respectively, related to these intangible assets.

Estimated amortization expense for the next five fiscal years for such intangible assets as of December 31, 2017 is projected below (in millions):



2018	$	3.8
2019	3.7
2020	3.5
2021	3.3
2022	3.2

During the year ended December 31, 2017, the Company recorded a favorable lease impairment charge of approximately $1.4 million related to a theatre scheduled to be closed. During the year ended December 31, 2016, the Company recorded a favorable lease impairment charge of approximately $0.3 million related to a theatre closure. The Company did not record an impairment of any intangible assets during the year ended December 31, 2015.

Debt Acquisition Costs

Debt acquisition costs are deferred and amortized to interest expense using the effective interest method over the terms of the related agreements. In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest, which intended to simplify the presentation of debt issuance costs. Prior to the issuance of ASU 2015-03, debt issuance costs were reported on the balance sheet as assets and amortized as interest expense. ASU 2015-03 requires that they be presented on the balance sheet as a direct deduction from the carrying amount of the related debt liability. The costs will continue to be amortized to interest expense using the effective interest method. ~~ASU 2015-03 is to be applied retrospectively and is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015.~~ The Company adopted this guidance during the quarter ended March 31, 2016. Debt issuance costs associated with long-term debt, net of accumulated amortization, were $2523.81 million and $3025.78 million as of December 31, ~~2016~~2017 and December 31, ~~2015~~2016, respectively. The balance sheet as of December 31, 2015 has been recast to reflect the reclassification of debt issuances costs, net of accumulated amortization, from "Other Non-Current Assets" to a reduction of "Long-Term Debt, Less Current Portion."

~~Investments~~45

The Company primarily accounts for its investments in non-consolidated subsidiaries using the equity method of accounting and has recorded the investments within "Other Non-Current Assets" and "Other Non-Current Liabilities" as applicable in its consolidated balance sheets. The Company records equity in earnings and losses of these entities in its consolidated statements of income. As of December 31, 2016, the Company holds a 19.7% interest in National CineMedia, LLC ("National CineMedia" or "NCM"), a 46.7% interest in Digital Cinema Implementation Partners, LLC, a 50% interest in Open Road Films, a 32% interest in AC JV, LLC and a 14.6% interest in Digital Cinema Distribution Coalition (each as described further under Note 4—"Investments"). In addition, as described further under Note 4—"Investments," the Company holds an equity investment in Atom Tickets, LLC, an internet ticketing partner of the Company. Such investment is accounted for under the cost method. The carrying value of the Company's investment in these entities as of December 31, 2016 and December 31, 2015 was approximately $367.7 million and $321.8 million, respectively.

The Company reviews investments in non-consolidated subsidiaries accounted for under the equity method for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be fully recoverable. The Company reviews unaudited financial statements on a quarterly basis and audited financial statements on an annual basis for indicators of triggering events or circumstances that indicate the potential impairment of these investments as well as current equity prices for its investment in National CineMedia and discounted projections of cash flows for certain of its other investees. Additionally, the Company has periodic discussions with the management of significant investees to assist in the identification of any factors that might indicate the potential for impairment. In order to determine whether the carrying value of investments may have experienced an other-than-temporary decline in value necessitating the write-down of the recorded investment, the Company considers various factors, including the period of time during which the fair value of the investment remains substantially below the recorded amounts, the investees' financial condition and quality of assets, the length of time the investee has been operating, the severity and nature of losses sustained in current and prior years, a reduction or cessation in the investees dividend payments, suspension of trading in the security, qualifications in accountant's reports due to liquidity or going concern issues, investee announcement of adverse changes, downgrading of investee debt, regulatory actions,

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

changes in reserves for product liability, loss of a principal customer, negative operating cash flows or working capital deficiencies and the recording of an impairment charge by the investee for goodwill, intangible or long-lived assets. Once a determination is made that an other-than-temporary impairment exists, the Company writes down its investment to fair value.Investments

~~There~~The ~~was~~Company noprimarily ~~impairment~~accounts for its investments in non-consolidated subsidiaries using the equity method of accounting and has recorded the investments within "Other Non-Current Assets" and "Other Non-Current Liabilities" as applicable in its consolidated balance sheets. The Company's ~~investments~~records ~~during~~equity ~~the~~in ~~years~~earnings ~~ended~~and losses of these entities in its consolidated statements of income. As of December 31, ~~2016~~2017, the Company holds a 17.9% interest in National CineMedia, LLC ("National CineMedia" or "NCM") and a 46.7% interest in Digital Cinema Implementation Partners, LLC. The carrying value of the Company's investment in these and other entities as of December 31, ~~2015~~2017 and ~~January~~December 31, 2016 was approximately $407.1 million and $367.7 million, ~~2015~~respectively.

There was no impairment of the Company's investments during the years ended December 31, 2017, December 31, 2016 and December 31, 2015.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance if it is deemed more likely than not that its deferred income tax assets will not be realized. The Company expects that certain deferred income tax assets are not more likely than not to be recovered and therefore has established a valuation allowance. The Company reassesses its need for the valuation allowance for its deferred income taxes on an ongoing basis.

Additionally, income tax rules and regulations are subject to interpretation, require judgment by the Company and may be challenged by the taxation authorities. As described further in Note 7—"Income Taxes," the Company applies the provisions of ASC Subtopic 740-10, Income Taxes—Overview. In accordance with ASC Subtopic 740-10, the Company recognizes a tax benefit only for tax positions that are determined to be more likely than not sustainable based on the technical merits of the tax position. With respect to such tax positions for which recognition of a benefit is appropriate, the benefit is measured at the largest amount of benefit that is greater than 50% ~~percent~~ likely of being realized upon ultimate settlement. Tax positions are evaluated on an ongoing basis as part of the Company's process for determining the provision for income taxes.

Interest Rate Swaps

Regal Cinemas has entered into hedging relationships via interest rate swap agreements to hedge against interest rate exposure of its variable rate debt obligations under Regal Cinemas' Amended Senior Credit Facility. Certain of these interest rate swaps qualify for cash flow hedge accounting treatment and as such, the change in the fair values of the interest rate swaps is recorded on the Company's consolidated balance sheet as an asset or liability with the effective portion of the interest rate swaps' gains or losses reported as a component of other comprehensive income and the ineffective portion reported in earnings. As interest expense is accrued on the debt obligation, amounts in accumulated other comprehensive income/loss related to the interest rate swaps will be reclassified into earnings. In the event that an interest rate swap is terminated or de-designated prior to maturity, gains or losses accumulated in other comprehensive income or loss remain deferred and are reclassified into earnings in the periods during which the hedged forecasted transaction affects earnings. See Note 14—"Fair Value of Financial Instruments" for discussion of the Company’s interest rate swaps’ fair value estimation methods and assumptions. The fair value of the Company's interest rate swaps is based on Level 2 inputs as described in ASC Topic 820, Fair Value Measurements and Disclosures, which include observable inputs such as dealer quoted prices for similar assets or liabilities, and represents the estimated amount Regal Cinemas would receive or pay to terminate the agreements taking into consideration various factors, including current interest rates, credit risk and counterparty credit risk. The counterparties to the Company’s interest rate swaps are major financial institutions. The Company evaluates the bond ratings of the financial institutions and believes that credit risk is at an acceptably low level.

~~Deferred Revenue~~46

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~deferred~~swaps' ~~revenue,~~gains ~~respectively,~~or ~~related~~losses toreported as a component of other comprehensive income and the ~~ESA~~ineffective ~~was~~portion ~~recorded~~reported asin ~~components~~earnings. ofAs ~~current~~interest ~~and~~expense ~~non-current~~is ~~deferred~~accrued ~~revenue~~on the debt obligation, amounts in accumulated other comprehensive income/loss related to the ~~accompanying~~interest ~~consolidated~~rate ~~balance~~swaps ~~sheets~~will be reclassified into earnings. ~~Deferred~~In ~~revenue~~the ~~related~~event that an interest rate swap is terminated or de-designated prior to ~~gift~~maturity, ~~cards~~gains ~~and~~or ~~bulk~~losses ~~ticket~~accumulated ~~sales~~in ~~and~~other ~~vendor~~comprehensive ~~marketing~~income ~~programs~~or isloss ~~recognized~~remain asdeferred ~~revenue~~and asare ~~described~~reclassified ~~above~~into earnings in ~~this~~the periods during which the hedged forecasted transaction affects earnings. See Note 214—"Fair ~~under~~Value of Financial Instruments"~~Revenue~~ ~~Recognition~~for discussion of the Company’s interest rate swaps’ fair value estimation methods and assumptions." AsThe fair value of ~~December~~the Company's interest rate swaps is based on Level 312 inputs as described in ASC Topic 820, ~~2016~~Fair Value Measurements and ~~December 31~~Disclosures, ~~2015,~~which ~~approximately~~include ~~$175.6~~observable ~~million~~inputs such as dealer quoted prices for similar assets or liabilities, and ~~$188.5~~represents ~~million~~the ofestimated ~~deferred~~amount ~~revenue~~Regal Cinemas would receive or pay to terminate the agreements taking into consideration various factors, ~~respectively~~including current interest rates, ~~related~~credit risk and counterparty credit risk. The counterparties to the ~~gift~~Company’s ~~cards~~interest ~~and~~rate ~~bulk~~swaps ~~tickets~~are ~~was~~major ~~recorded~~financial asinstitutions. aThe ~~component~~Company ofevaluates ~~current~~the ~~deferred~~bond ~~revenue~~ratings inof the ~~accompanying~~financial ~~consolidated~~institutions ~~balance~~and ~~sheets~~believes that credit risk is at an acceptably low level.

Deferred Revenue

Deferred revenue relates primarily to the amount we received for agreeing to the 2007 ESA modification, amounts recorded in connection with the receipt of newly issued common units of National CineMedia, cash received from the sale of bulk tickets and gift cards, and amounts received in connection with vendor marketing programs. The amount we received for agreeing to the ESA modification is being amortized to advertising revenue over the 30 year term of the agreement following the units of revenue method. In addition, as described in Note 4—"Investments," amounts recorded as deferred revenue in connection with the receipt of newly issued common units of National CineMedia pursuant to the provisions of the Common Unit Adjustment Agreement are being amortized to advertising revenue over the remaining term of the ESA following the units of revenue method. As of December 31, 2017 and December 31, 2016, approximately $418.5 million and $425.0 million of deferred revenue, respectively, related to the ESA was recorded as components of current and non-current deferred revenue in the accompanying consolidated balance sheets. Deferred revenue related to gift cards and bulk ticket sales and vendor marketing programs is recognized as revenue as described above in this Note 2 under "Revenue Recognition." As of December 31, 2017 and December 31, 2016, approximately $168.6 million and $175.6 million of deferred revenue, respectively, related to the gift cards and bulk tickets was recorded as a component of current deferred revenue in the accompanying consolidated balance sheets.

Deferred Rent

The Company recognizes rent on a straight-line basis after considering the effect of rent escalation provisions resulting in a level monthly rent expense for each lease over its term. The deferred rent liability is included in other non-current liabilities in the accompanying consolidated balance sheets.

Film Costs

The Company estimates its film cost expense and related film cost payable based on management's best estimate of the ultimate settlement of the film costs with the distributors. Generally, less than one-third of our quarterly film expense is estimated at period-end. The length of time until these costs are known with certainty depends on the ultimate duration of the film's theatrical run, but is typically "settled" within 2 to 3 months of a particular film's opening release. Upon settlement with our film distributors, film cost expense and the related film cost payable are adjusted to the final film settlement.

Loyalty Program

Members of the Regal Crown Club® earn credits for each dollar spent at the Company's theatres and can redeem such credits for movie tickets, concession items and movie memorabilia at the theatre or in an online reward center. Because the Company believes that the value of the awards granted to Regal Crown Club® members is insignificant in relation to the value of the transactions necessary to earn the award, the Company records the estimated incremental cost of providing awards under the Regal Crown Club® loyalty program at the time the awards are earned. Historically, and for the years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015, the costs of these awards have not been significant to the Company's consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2017, December 31, 2016 and December 31, 2015

Advertising and Start-Up Costs

The Company expenses advertising costs as incurred. Start-up costs associated with a new theatre are also expensed as incurred.

Share-Based Compensation

As described in Note 9—"Capital Stock ~~And~~and Share-Based Compensation," we apply the provisions of ASC Subtopic 718-10, Compensation—Stock Compensation—Overall. Under ASC Subtopic 718-10, share-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the employee's requisite service period.

Under ASC Subtopic 718-10, the Company elected to adopt the alternative transition method for calculating the tax effects of share-based compensation. The alternative transition method includes a simplified method to establish the beginning balance of the additional paid-in capital pool related to the tax effects of employee share-based compensation, which is available to absorb tax deficiencies that could be recognized subsequent to the adoption of ASC Subtopic 718-10.

Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include, but are not limited to, deferred revenue, property and equipment, goodwill, income taxes and purchase accounting. Actual results could differ from those estimates.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2016, December 31, 2015 and January 1, 2015

Segments

As of December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015, the Company managed its business under one reportable segment: theatre exhibition operations.

Acquisitions

The Company accounts for acquisitions under the acquisition method of accounting. The acquisition method requires that the acquired assets and liabilities, including contingencies, be recorded at fair value determined on the acquisition date and changes thereafter reflected in income. For significant acquisitions, the Company obtains independent third party valuation studies for certain of the assets acquired and liabilities assumed to assist the Company in determining fair value. The estimation of the fair values of the assets acquired and liabilities assumed involves a number of estimates and assumptions that could differ materially from the actual amounts recorded. The results of the acquired businesses are included in the Company's results from operations beginning from the day of acquisition.

Comprehensive Income

Total comprehensive income, net of tax, for the years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015 was $~~171~~116.31 million, $~~152~~171.63 million and $~~106~~152.16 million, respectively. Total comprehensive income consists of net income and other comprehensive income, net of tax, related to the change in the aggregate unrealized gain/loss on the Company's interest rate swap arrangement, the change in fair value of available for sale equity securities (including other-than-temporary impairments), the reclassification adjustment for gain on sale of available for sale securities recognized in net income and the change in fair value of equity method investee interest rate swap transactions during each of the years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015. The Company's interest rate swap arrangements and available for sale equity securities are further described in Note 13—"Derivative Instruments" and Note 14—"Fair Value of Financial Instruments."

Recent Accounting Pronouncements

Adoption of New Accounting Pronouncements

In ~~February~~March ~~2015~~2016, the FASB issued ASU ~~2015~~2016-0207, ~~Consolidation~~Investments ~~(Topic~~- ~~810)~~Equity -Method ~~Amendments~~and toJoint ~~the~~Ventures ~~Consolidation~~(Topic ~~Analysis,~~323). ~~which~~The ~~provides~~purpose ~~guidance~~of onASU ~~evaluating~~2016-07 ~~whether~~is ato ~~reporting~~eliminate ~~entity~~the ~~should~~requirement ~~consolidate~~that ~~certain~~when ~~legal~~an ~~entities.~~investment ~~Specifically,~~qualifies ~~the~~for ~~amendments~~use ~~modify~~of the ~~evaluation~~equity ofmethod ~~whether~~as ~~limited~~a ~~partnerships~~result ~~and~~of ~~similar~~an ~~legal~~increase ~~entities~~in ~~are~~the ~~variable~~level ~~interest~~of ~~entities~~ownership ~~("VIEs")~~interest or ~~voting~~degree ~~interest~~of ~~entities. Further~~influence, ~~the~~an ~~amendments~~investor ~~eliminate~~must adjust the ~~presumption~~investment, ~~that~~results aof ~~general~~operations, ~~partner~~and ~~should~~retained ~~consolidate~~earnings aretroactively ~~limited~~on ~~partnership,~~a asstep-by-step ~~well~~basis as ~~affect~~if the ~~consolidation~~equity ~~analysis~~method ofhad ~~reporting~~been ~~entities~~in ~~that~~effect ~~are~~during ~~involved~~all ~~with~~previous ~~VIEs,~~periods ~~particularly those~~ that ~~have~~the ~~fee~~investment ~~arrangements~~was ~~and related party relationships~~held. ASU ~~2015~~2016-0207 is effective for ~~interim~~fiscal ~~and~~years ~~annual reporting periods~~ beginning after December 15, 2015. Early adoption is permitted. A reporting entity may apply the amendments using a modified retrospective approach or a full retrospective application. The Company's adoption of ASU 2015-02 during the quarter ended March 312016, ~~2016~~including ~~had~~interim ~~no impact on the Company's consolidated financial statements and related disclosures.~~

As further described above in this Note 2 under "Debt Acquisition Costs," in April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest. The Company adopted this guidance during the quarter ended March 31, 2016. Debt issuance costs associated with long-term debt, net of accumulated amortization, were $25.8 million and $30.7 million as of December 31, 2016 and December 31, 2015, respectively. The balance sheet as of December 31, 2015 has been recast to reflect the reclassification of debt issuances costs, net of accumulated amortization, from "Other Non-Current Assets" to a reduction of "Long-Term Debt, Less Current Portion." 48

In August 2015, the FASB issued ASU 2015-15, Interest – Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements. ASU 2015-15 adds clarification to the guidance presented in ASU 2015-03, as that guidance did not address the presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. We adopted ASU 2015-15 along with the original guidance in ASU 2015-03 discussed above. The guidance in ASU 2015-15 did not have an impact on our consolidated financial statements and related disclosures.

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740) - Balance Sheet Classification of Deferred Taxes, which requires the presentation of deferred tax liabilities and assets be classified as non-current in a classified statement of financial position. The amendments in this update are effective for financial statements issued for annual periods beginning

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~after December 15, 2016, and interim~~ periods within those ~~annual~~fiscal ~~periods. Earlier~~years ~~application~~and isearly ~~permitted~~adoption ~~for~~is ~~all entities as of the beginning of an interim or annual reporting period~~permitted. The ~~amendments~~Company's inadoption of ASU ~~2015~~2016-1707 ~~may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. We adopted this guidance~~ during the quarter ended March 31, ~~2016~~2017 ~~and~~had ~~elected~~no ~~the~~impact ~~prospective approach. Therefore, deferred taxes as of December 31, 2016 are recorded as long-term deferred tax assets and long-term deferred tax liabilities~~ on the ~~balance~~Company's ~~sheet. Balances~~consolidated asfinancial ofstatements ~~December 31,~~and ~~2015~~related ~~have not been recast~~disclosures.

In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which relates to the accounting for employee share-based payments. ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and early adoption is permitted. The Company's adoption of ASU 2016-09 had the impact of reducing income tax expense by approximately $1.3 million pertaining to excess tax benefits related to vesting of 493,516 restricted stock awards and to a lesser extent, dividends paid on restricted stock during the year ended December 31, 2017. Historically, such excess tax benefits would have been recorded as a component of additional paid-in capital.

In October 2016, the FASB issued ASU 2016-17, Consolidation (Topic 810): Interests Held through Related Parties That Are under Common Control, which requires when assessing which party is the primary beneficiary in a VIE, the decision maker considers interests held by entities under common control on a proportionate basis instead of treating those interests as if they were that of the decision maker itself, as current U.S. GAAP requires. ASU 2016-17 is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years and early adoption is permitted. The Company's adoption of ASU 2016-17 during the quarter ended March 31, 2017 had no impact on the Company's consolidated financial statements and related disclosures.

Recently Issued FASB Accounting Standard Codification Updates

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The standard permits the use of either the retrospective or modified retrospective transition method. ASU 2014-09 was originally effective for annual and interim reporting periods beginning after December 15, 2016. However, the standard was deferred by ASU 2015-14, issued by the FASB in August 2015, and is now effective for fiscal years beginning on or after December 15, 2017, including interim reporting periods within that reporting period, with early adoption permitted as of the original effective date. ~~The~~In ~~Company believes that the adoption of ASU 2014-09 will primarily impact its accounting for its (i) loyalty program~~addition, ~~(ii)~~amendments ~~gift cards and bulk tickets, (iii) customer incentives and (iv) amounts recorded as deferred revenue and the method of amortization for advanced payments received~~ in ~~connection with the 2007 National CineMedia ESA modification and~~ subsequent ~~receipts~~Accounting ofStandards ~~common~~Updates ~~units~~have ofeither ~~National~~clarified ~~CineMedia~~or ~~pursuant~~revised toguidance ~~the provisions of the Common Unit Adjustment Agreement, each~~ as ~~described~~set forth in ~~Note 4—"Investments." The Company has selected the modified retrospective method for adoption of~~ ASU 2014-09, ~~and~~including ~~is continuing to further evaluate the full impact that~~ ASU ~~2014~~2016-0908, ~~will~~Revenue ~~have~~from onContracts ~~its~~with ~~consolidated~~Customers ~~financial~~(Topic ~~statements~~606): ~~and~~Principal ~~related~~versus ~~disclosures. To~~Agent ~~that~~Considerations ~~end,~~(Reporting ~~the~~Revenues ~~Company~~Gross ~~has~~versus ~~conducted initial analyses~~Net), ~~developed project management relative to the process of adopting~~ ASU ~~2014~~2016-0910, ~~and~~Revenue isfrom ~~currently~~Contracts ~~completing~~with ~~detailed~~Customers: ~~contract~~Identifying ~~reviews~~Performance toObligations ~~determine~~and ~~necessary~~Licensing ~~adjustments to existing accounting policies~~ and toASU ~~support~~2016-12, anRevenue ~~evaluation~~from ofContracts ~~the~~with ~~standard’s~~Customers: ~~impact~~Narrow-Scope onImprovements ~~the Company’s consolidated results of operations~~ and ~~financial~~Practical ~~condition~~Expedients.

InThe ~~February~~Company ~~2016,~~has selected the ~~FASB~~modified ~~issued~~retrospective method for adoption of ASU ~~2016~~2014-~~02,~~09 ~~Leases~~and ~~(Topic~~its ~~842).~~related ASU ~~2016-02~~amendments. ~~establishes~~Under athis ~~right-of-use~~method, ~~("ROU")~~we ~~model~~will ~~that~~recognize ~~requires~~the acumulative ~~lessee~~effect toof ~~record~~the achanges ~~ROU~~in ~~asset~~retained ~~and~~earnings aat ~~lease~~the ~~liability~~date onof ~~the~~adoption ~~balance~~(January ~~sheet~~1, ~~for~~2018) ~~all~~as ~~leases~~described ~~with~~below, ~~terms~~but ~~longer~~will ~~than~~not ~~12 months.~~restate ~~Leases~~prior ~~will~~periods. The beadoption ~~classified~~of asASU ~~either~~2014-09 ~~finance~~and orits ~~operating,~~related ~~with~~ASU ~~classification~~amendments ~~affecting~~primarily impacts the ~~pattern~~Company's ofaccounting ~~expense~~for ~~recognition~~its in(i) ~~the~~loyalty ~~income~~program, ~~statement.~~(ii) ~~The~~gift ~~new~~cards ~~standard~~and isbulk ~~effective~~tickets, ~~for~~including ~~fiscal~~commissions ~~years~~paid ~~beginning~~to ~~after~~third ~~December 15~~parties, ~~2018,~~(iii) ~~including~~the ~~interim~~classification ~~periods~~of ~~within~~internet ~~those~~ticketing ~~fiscal~~surcharges ~~years.~~and A(iv) ~~modified~~amounts ~~retrospective~~recorded ~~transition~~as ~~approach~~deferred isrevenue ~~required~~and ~~for~~the ~~lessees~~method of amortization for ~~capital~~the ~~and~~advanced ~~operating~~payment ~~leases~~received ~~existing~~in ~~at,~~connection orwith ~~entered~~the ~~into~~2007 ~~after,~~National ~~the~~CineMedia ~~beginning~~ESA modification and subsequent receipts of ~~the~~common ~~earliest~~units ~~comparative~~of ~~period~~National ~~presented~~CineMedia inpursuant to the ~~financial~~provisions ~~statements,~~of ~~with~~the ~~certain~~Common ~~practical~~Unit ~~expedients~~Adjustment ~~available~~Agreement. ~~The~~While ~~Company~~we isdo ~~evaluating~~not believe the ~~impact~~adoption ~~that~~of ASU ~~2016~~2014-0209 will have a material impact on ~~its~~our ~~consolidated~~net ~~financial~~income ~~statements~~or ~~and~~cash ~~related~~flows ~~disclosures~~from ~~and~~operations, ~~believes~~we ~~that~~do expect the ~~significance~~standard ofto ~~its~~materially ~~future~~impact ~~minimum~~the ~~rental~~timing ~~payments~~and ~~will~~classification ~~result~~of inrevenues aand ~~material~~related ~~increase~~expenses in ~~ROU~~the ~~assets~~following ~~and~~key ~~lease liabilities.~~ areas:

In March 2016, the FASB issued ASU 2016-07, Investments – Equity Method and Joint Ventures (Topic 323). The purpose of ASU 2016-07 is to eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment was held. ASU 2016-07 is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company does not expect the adoption of ASU 2016-07 to have a material impact on its consolidated financial statements and related disclosures. 49

In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenues Gross versus Net). The purpose of ASU 2016-08 is to clarify the implementation of revenue recognition guidance related to principal versus agent considerations. ASU 2016-08 is effective for fiscal years beginning after December 15, 2017, including interim periods within that year, concurrent with ASU 2014-09. Early adoption is permitted. The Company is evaluating the impact that ASU 2016-08 will have on its consolidated financial statements and related disclosures.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~2016~~• First, we believe the advanced payment received in connection with the 2007 National CineMedia ESA modification and subsequent receipts of common units of National CineMedia pursuant to the provisions of the Common Unit Adjustment Agreement, each as described in Note 4 to the consolidated financial statements included in Part II, Item 8 of this Form 10-K, include a significant financing component under ASU 2014-09. isAccordingly, ~~effective~~we ~~for~~expect ~~fiscal~~advertising ~~years~~revenues will increase materially with a similar offsetting increase in non-cash interest expense beginning ~~after~~January 1, 2018. Through December 1531, ~~2016~~2017, ~~including~~the ~~interim~~Company ~~periods~~utilized ~~within~~the ~~those~~units ~~fiscal~~of ~~years~~revenue ~~and~~method ~~early~~to ~~adoption~~amortize issuch ~~permitted.~~amounts, ~~The~~but ~~Company~~will ischange ~~evaluating~~its ~~the~~amortization ~~impact~~to ~~that~~a straight-line method under ASU ~~2016~~2014-09 ~~will~~effective January 1, 2018. We do not expect these changes to have a material impact on our net income or cash flows from operations. As of the date of this Form 10-K, the Company expects to reduce its ~~consolidated~~opening ~~financial~~January ~~statements~~1, ~~and~~2018 retained earnings balance (along with a corresponding credit to deferred revenue) by approximately $15 million to $20 million, before related ~~disclosures.~~tax effects, to give effect to the change in amortization method with respect to these advanced payments.

In• ~~April 2016~~Second, ~~the~~under ~~FASB issued~~ ASU ~~2016~~2014-~~10,~~09 ~~Revenue~~and ~~from~~effective ~~Contracts~~January ~~with~~1, ~~Customers~~2018, ~~(Topic~~the ~~606):~~Company ~~Identifying~~will ~~Performance~~record ~~Obligations~~internet ~~and~~ticketing ~~Licensing.~~surcharge ~~The~~fees ~~purpose~~based ofon ~~ASU~~the ~~2016-10~~gross istransaction toprice. ~~provide~~Previously, ~~more detailed guidance in~~ the ~~following~~Company ~~key~~recorded ~~areas:~~such ~~identifying~~fees ~~performance~~net ~~obligations~~of ~~and~~third-party ~~licenses~~commission ofor ~~intellectual~~service ~~property~~fees. ~~ASU~~This ~~2016-10~~change iswill ~~effective~~have ~~for~~the ~~fiscal~~effect ~~years~~of ~~beginning~~materially ~~after~~increasing ~~December~~other ~~15,~~operating ~~2017,~~revenues ~~including~~and ~~interim~~other ~~periods~~operating ~~within that year~~expenses, ~~concurrent~~but ~~with~~will ~~ASU~~have ~~2014-09.~~no ~~Early adoption is permitted. The Company is evaluating the~~ impact ~~that ASU 2016-10 will have~~ on ~~its~~net ~~consolidated~~income ~~financial~~or ~~statements~~cash ~~and~~flows ~~related~~from ~~disclosures~~operations.

In• ~~May~~Third, ~~2016~~with respect to our gift card and bulk ticket programs, the ~~FASB~~adoption ~~issued~~of ASU ~~2016~~2014-~~12,~~09 ~~Revenue~~is ~~from~~not ~~Contracts~~expected ~~with~~to ~~Customers~~have ~~(Topic~~a ~~606):~~material ~~Narrow-Scope~~impact ~~Improvements~~on ~~and~~the ~~Practical~~annual ~~Expedients.~~revenue ~~The~~we ~~purpose~~currently ofrecognize ~~ASU~~from ~~2016-12~~these isprograms, tobut ~~address~~it ~~certain~~will ~~narrow~~change ~~aspects~~the ofmethod ~~ASC~~in ~~Topic~~which ~~606~~we ~~including~~recognize ~~assessing~~revenue ~~collectability~~from gift cards and bulk tickets. Through December 31, ~~presentation~~2017, ofthe ~~sales~~Company recognized revenue associated with gift cards and ~~other~~bulk ~~similar~~tickets ~~taxes~~when redeemed, ~~noncash~~or ~~considerations,~~when ~~contract~~the ~~modifications~~likelihood ~~and~~of ~~completed~~redemption ~~contracts~~became atremote ~~transition~~(known as "breakage" in our industry) based on historical experience. Under ASU ~~2016~~2014-1209 isand effective ~~for~~January ~~fiscal~~1, ~~years~~2018, ~~beginning~~the ~~after~~Company ~~December~~will ~~15,~~recognize ~~2017,~~revenue ~~including~~from ~~interim~~unredeemed ~~periods~~gift ~~within~~cards ~~that~~and ~~year,~~bulk ~~concurrent~~tickets ~~with~~as ~~ASU~~redeemed ~~2014-09. Early~~and ~~adoption~~will recognize breakage following the proportional method where revenue is ~~permitted. The~~recognized in proportion to the pattern of rights exercised by the customer when the Company expects that it is ~~evaluating~~probable that a significant revenue reversal would not occur for any estimated breakage amounts. As of the ~~impact~~date ~~that~~of ~~ASU~~this ~~2016~~Form 10-12K, ~~will~~the ~~have~~Company onexpects to reduce its ~~consolidated~~opening ~~financial~~January ~~statements~~1, ~~and~~2018 retained earnings balance (along with a corresponding credit to deferred revenue) by approximately $25 million to $30 million, before related ~~disclosures.~~tax effects, to give effect to this change in accounting for our gift card and bulk ticket programs.

•

The Company is currently finalizing its review of ASU 2014-09 and its related ASU amendments with respect to required disclosures and financial statement presentation for fiscal 2018.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2017, December 31, 2016 and December 31, 2015

recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is evaluating the impact that ASU 2016-02 will have on its consolidated financial statements and related disclosures and believes that the significance of its future minimum rental payments will result in a material increase in ROU assets and lease liabilities.

In ~~October~~January ~~2016~~2017, the FASB issued ASU ~~2016~~2017-1701, ~~Consolidation~~Business Combinations (Topic ~~810~~805): ~~Interests~~Clarifying ~~Held~~the ~~through~~Definition ~~Related~~of ~~Parties~~a ~~That~~Business. ~~Are~~The ~~under~~purpose ~~Common~~of ~~Control,~~ASU ~~which~~2017-01 ~~requires~~is ~~when~~to ~~assessing~~clarify ~~which party is~~ the ~~primary~~definition ~~beneficiary~~of in a ~~VIE,~~business ~~the~~to ~~decision~~assist ~~maker~~entities ~~considers~~with ~~interests~~evaluating ~~held~~whether bytransactions ~~entities~~should ~~under~~be ~~common~~accounted ~~control~~for onas aacquisitions ~~proportionate~~(or ~~basis~~disposals) ~~instead~~ of ~~treating~~assets ~~those~~or ~~interests~~businesses. asASU if2017-01 ~~they~~is ~~were~~effective ~~that~~for offiscal ~~the~~years ~~decision~~beginning ~~maker~~after ~~itself~~December 15, as2017, ~~current~~including ~~GAAP~~interim ~~requires~~periods within that year. ~~ASU~~ ~~2016-17~~The isamendments ~~effective~~in ~~for~~ASU ~~annual~~2017-01 ~~periods,~~should ~~and~~be ~~interim~~applied ~~periods~~prospectively ~~therein,~~on ~~beginning~~or after ~~December~~the ~~15,~~effective ~~2016~~date. Early ~~application~~adoption is permitted ~~in any interim or annual period~~. The Company does not expect that the adoption of ASU ~~2016~~2017-1701 towill have a material impact on its consolidated financial statements and related disclosures.

In ~~January~~August 2017, the FASB issued ASU 2017-0112, Derivatives ~~Business~~and ~~Combinations~~Hedging (Topic ~~805~~815): ~~Clarifying~~Targeted ~~the~~Improvements ~~Definition~~to ofAccounting afor ~~Business.~~Hedging ~~The~~Activities, ~~purpose~~which ofis ~~ASU~~intended ~~2017-01~~to issimplify toand ~~clarify~~amend the ~~definition~~application of ahedge ~~business~~accounting to ~~assist~~more ~~entities~~clearly ~~with~~portray ~~evaluating~~the ~~whether~~economics ~~transactions~~of ~~should~~an beentity’s ~~accounted~~risk ~~for~~management asstrategies ~~acquisitions~~in ~~(or~~its ~~disposals)~~financial ~~of assets or businesses~~statements. ASU 2017-0112 isalso amends the presentation and disclosure requirements and changes how entities assess hedge effectiveness. The effective date of the new standard for public companies is for fiscal years beginning after December 15, ~~2017,~~2018 ~~including~~and interim periods within ~~that~~those ~~year~~fiscal years. ~~The~~Early ~~amendments~~adoption inis ~~ASU~~permitted. ~~2017-01~~The ~~should~~new standard must be ~~applied~~adopted ~~prospectively~~using ona ormodified ~~after~~retrospective transition with a cumulative effect adjustment recorded to opening retained earnings as of the ~~effective~~initial adoption date. The ~~Early~~Company ~~adoption~~ is ~~permitted.~~evaluating Wethe doimpact ~~not~~that ~~expect~~ ASU 2017-0112 towill have ~~an impact~~ on ~~our~~its consolidated financial statements and related disclosures.

~~In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment~~3. The purpose of ASU 2017-04 is to simplify the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within that year. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is evaluating the impact that ASU 2017-04 will have on its consolidated financial statements and related disclosures. ACQUISITIONS

56On April 13, 2017, the Company completed the acquisition of two theatres with 41 screens located in Houston, Texas from Santikos Theaters, Inc. for an aggregate net cash purchase price of $29.8 million. In addition, on April 18, 2017, the Company purchased a parcel of land located in Montgomery County, Texas from an entity affiliated with Santikos Theaters, Inc. for a net cash purchase price of approximately $7.3 million. On May 18, 2017, the Company completed the acquisition of seven theatres with 93 screens located in Kansas and Oklahoma from Warren Theatres for an aggregate net cash purchase price, before post-closing adjustments, of $134.5 million. The Company incurred approximately $1.7 million in transaction costs associated with these acquisitions, which are reflected in "general and administrative expenses" in the accompanying consolidated statements of income for year ended December 31, 2017.

The transactions have been accounted for using the acquisition method of accounting in accordance with ASC 805, Business Combinations, which requires allocation of the purchase price to the estimated fair values of assets and liabilities acquired in each transaction. The allocation of purchase price is based on management’s judgment after evaluating several factors, including preliminary valuation assessments. Any changes in the fair values of assets acquired and liabilities assumed during the measurement period may result in adjustments to goodwill. The allocation of purchase price is preliminary and subject to changes as appraisals of tangible and intangible assets and liabilities including working capital are finalized, purchase price adjustments are completed and additional information regarding the tax bases of assets and liabilities at the acquisition date becomes available. The following is a summary of the final allocation of the aggregate purchase price to the estimated fair values of the assets acquired and liabilities assumed at the respective dates of acquisition (in millions):

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

3. ACQUISITION



Current assets	$	2.1
Land	28.8
Buildings, equipment and leasehold improvements	115.7
Noncompete agreements	2.7
Goodwill (1)	26.2
Other assets	0.1
Current liabilities	(4.0		)
Total purchase price	$	171.6

On September 3, 2015, Regal completed the acquisition of five theatres with 61 screens from entities affiliated with Georgia Theatre Company for an aggregate net cash purchase price of $9.2 million. The acquisition enhanced the Company’s presence in the state of Georgia. The aggregate net cash purchase price was allocated to the identifiable assets acquired for each of the respective theatre locations based on their estimated fair values at the date of acquisition using the acquisition method of accounting. The allocation of the purchase price is based on management’s judgment after evaluating several factors. The results of operations of the five acquired theatres have been included in the Company’s consolidated financial statements for periods subsequent to the acquisition date.________________________________

~~The~~(1) Goodwill ~~following~~represents ~~is a summary of~~ the ~~allocation~~excess ~~of the~~ aggregate ~~net cash~~ purchase price toover the ~~estimated~~amounts ~~fair~~assigned ~~values~~to ~~of the identifiable~~ assets acquired, ~~that~~including ~~have~~intangible ~~been~~assets, ~~recognized~~and byliabilities ~~the~~assumed ~~Company~~and inis ~~its~~fully ~~consolidated~~deductible ~~balance~~for ~~sheet~~tax ~~as of the date of acquisition (in millions):~~ purposes.

Property and equipment	$	0.9
Goodwill	8.3
Total purchase price	$	9.2

The results of operations of the acquired theatre operations have been included in the Company's consolidated financial statements for periods subsequent to the respective acquisition dates. The acquisitions contributed approximately $57.9 million of total revenues for the year ended December 31, 2017. Net income was an immaterial amount for the year ended December 31, 2017.

The following unaudited pro forma results of operations for the years ended December 31, 2017 and December 31, 2016 assume the acquisitions occurred as of the beginning of fiscal 2016. The pro forma results have been prepared for comparative purposes only and do not purport to indicate the results of operations which would actually have occurred had the combination been in effect on the dates indicated, or which may occur in the future.



(in millions, except per share data)	Year Ended December 31, 2017		Year Ended December 31, 2016
Revenues	$	3,196.0	$	3,295.6
Income from operations	272.1		343.4
Net income attributable to controlling interest	112.5		172.7
Diluted earnings per share	$	0.72	$	1.10

4. INVESTMENTS

Investment in National CineMedia, LLC

We maintain an investment in National CineMedia. National CineMedia provides in-theatre advertising for its theatrical exhibition partners, which include us, AMC Entertainment Holdings, Inc. ("AMC") and Cinemark Holdings, Inc. ("Cinemark").

On February 13, 2007, National CineMedia, Inc. ("NCM, Inc."), the sole manager of National CineMedia, completed an initial public offering ("IPO") of its common stock. NCM, Inc. sold 38.0 million shares of its common stock for $21 per share in the IPO, less underwriting discounts and expenses. NCM, Inc. used a portion of the net cash proceeds from the IPO to acquire newly issued common units from National CineMedia. At the closing of the IPO, the underwriters exercised their over-allotment option to purchase an additional 4.0 million shares of common stock of NCM, Inc. at the initial offering price of $21 per share, less underwriting discounts and commissions. In connection with this over-allotment option exercise, Regal, AMC and Cinemark each sold to NCM, Inc. common units of National CineMedia on a pro rata basis at the initial offering price of $21 per share, less underwriting discounts and expenses. Upon completion of this sale of common units, Regal held approximately 21.2 million common units of National CineMedia ("Initial Investment Tranche"). Such common units are immediately redeemable on a one-to-one basis for shares of NCM, Inc. common stock.

As a result of the transactions associated with the IPO and receipt of proceeds in excess of our investment balance, the Company reduced its investment in National CineMedia to zero. Accordingly, we will not provide for any additional losses, as we have not guaranteed obligations of National CineMedia and we are not otherwise committed to provide further financial support for National CineMedia. In addition, subsequent to the IPO, the Company determined it would not recognize its share of any undistributed equity in the earnings of National CineMedia pertaining to the Company's Initial Investment Tranche in National CineMedia until National CineMedia's future net earnings, net of distributions received, equal or exceed the amount of the above described excess distribution. Until such time, equity in earnings related to the Company's Initial Investment Tranche in National CineMedia will be recognized only to the extent that the Company receives cash distributions from National CineMedia. The Company believes that the accounting model provided by ASC 323-10-35-22 for recognition of equity investee losses in excess of an investor's basis is analogous to the accounting for equity income subsequent to recognizing an excess distribution. The Company's Initial Investment Tranche is recorded at $0 cost.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~National~~support ~~CineMedia~~for toNational ~~a monthly theatre access fee~~CineMedia. ~~The~~In ~~theatre access fee is composed of a fixed $0.0756 payment per patron for fiscal 2016 and increases by 8% every 5 years starting at the end of fiscal 2011~~addition, asubsequent ~~fixed~~to ~~$800 payment per digital screen each year, which increases by 5% annually starting at~~ the ~~end of fiscal 2007 (or $1~~IPO,~~241~~ ~~for fiscal 2016) and an additional payment per digital screen of $638 for fiscal 2016. The access fee revenues received by~~ the Company ~~under its contract are~~ determined ~~annually~~it ~~based~~would onnot arecognize ~~combination~~its share of ~~both~~any ~~fixed~~undistributed ~~and~~equity ~~variable~~in ~~factors which include~~ the ~~total~~earnings ~~number~~ of ~~theatre~~National ~~screens,~~CineMedia ~~attendance~~pertaining ~~and~~to ~~actual~~the ~~revenues~~Company's ~~(as~~Initial ~~defined~~Investment Tranche in ~~the~~National ~~ESA)~~CineMedia ~~generated~~until by National CineMedia.'s ~~The~~future ~~ESA~~net ~~does~~earnings, ~~not~~net ~~require us to maintain a minimum number~~ of ~~screens~~distributions ~~and~~received, ~~does~~equal ~~not~~or ~~provide~~exceed athe ~~fixed~~ amount of ~~access fee revenue to be earned by~~ the ~~Company~~above indescribed ~~any~~excess ~~period~~distribution. ~~The~~Until ~~theatre~~such ~~access~~time, ~~fee~~equity ~~paid~~ in ~~the~~earnings ~~aggregate~~related to ~~us,~~the ~~AMC~~Company's ~~and~~Initial ~~Cinemark~~Investment ~~will~~Tranche ~~not~~in beNational ~~less~~CineMedia ~~than~~will ~~12%~~be ofrecognized ~~NCM's~~only ~~aggregate~~to ~~advertising~~the ~~revenue,~~extent orthat itthe ~~will~~Company bereceives ~~adjusted~~cash ~~upward~~distributions tofrom ~~meet~~National ~~this minimum payment~~CineMedia. ~~On-screen~~The ~~advertising~~Company ~~time~~believes ~~provided~~that tothe ~~our~~accounting ~~beverage~~model ~~concessionaire is~~ provided by ~~National~~ASC ~~CineMedia~~323-10-35-22 ~~under~~for ~~the~~recognition ~~terms~~ of ~~the~~equity ~~ESA.~~investee Inlosses ~~addition,~~in weexcess ~~receive~~of ~~mandatory~~an ~~quarterly~~investor's ~~distributions~~basis ofis ~~any~~analogous ~~excess~~to ~~cash~~the ~~from~~accounting ~~National~~for ~~CineMedia. The~~equity ~~modified~~income ~~ESA~~subsequent ~~has,~~to ~~except~~recognizing ~~with~~an ~~respect~~excess todistribution. ~~certain~~The ~~limited~~Company's ~~services,~~Initial aInvestment ~~remaining~~Tranche ~~term~~is ofrecorded ~~approximately~~at 20$0 ~~years~~cost.

In connection with the completion of the IPO, the joint venture partners, including RCI, amended and restated their exhibitor services agreements with National CineMedia in exchange for a significant portion of its pro rata share of the IPO proceeds. The modification extended the term of the exhibitor services agreement ("ESA") to 30 years, provided National CineMedia with a 5-year right of first refusal beginning one year prior to the end of the term and changed the basis upon which RCI is paid by National CineMedia from a percentage of revenues associated with advertising contracts entered into by National CineMedia to a monthly theatre access fee. The theatre access fee is composed of a fixed $0.0816 payment per patron for fiscal 2017 and increases by 8% every 5 years starting at the end of fiscal 2011, a fixed $800 payment per digital screen each year, which increases by 5% annually starting at the end of fiscal 2007 (or $1,304 for fiscal 2017) and an additional payment per digital screen of $670 for fiscal 2017. The access fee revenues received by the Company under its contract are determined annually based on a combination of both fixed and variable factors which include the total number of theatre screens, attendance and actual revenues (as defined in the ESA) generated by National CineMedia. The ESA does not require us to maintain a minimum number of screens and does not provide a fixed amount of access fee revenue to be earned by the Company in any period. The theatre access fee paid in the aggregate to us, AMC and Cinemark will not be less than 12% of NCM's aggregate advertising revenue, or it will be adjusted upward to meet this minimum payment. On-screen advertising time provided to our beverage concessionaire is provided by National CineMedia under the terms of the ESA. In addition, we receive mandatory quarterly distributions of any excess cash from National CineMedia. The modified ESA has, except with respect to certain limited services, a remaining term of approximately 20 years.

The amount we received for agreeing to the ESA modification was approximately $281.0 million, which represents the estimated fair value of the ESA modification payment. We estimated the fair value of the ESA payment based upon a valuation performed by the Company with the assistance of third party specialists. This amount has been recorded as deferred revenue and is being amortized to advertising revenue over the 30 year term of the ESA following the units of revenue method. Under the units of revenue method, amortization for a period is calculated by computing a ratio of the proceeds received from the ESA modification payment to the total expected decrease in revenues due to entry into the new ESA over the 30 year term of the agreement and then applying that ratio to the current period's expected decrease in revenues due to entry into the new ESA.

Also in connection with the IPO, the joint venture partners entered into a Common Unit Adjustment Agreement with National CineMedia. Pursuant to our Common Unit Adjustment Agreement, from time to time, common units of National CineMedia held by the joint venture partners will be adjusted up or down through a formula primarily based on increases or decreases in the number of theatre screens operated and theatre attendance generated by each joint venture partner. The common unit adjustment is computed annually, except that an earlier common unit adjustment will occur for a joint venture partner if its acquisition or disposition of theatres, in a single transaction or cumulatively since the most recent common unit adjustment, will cause a change of two percent or more in the total annual attendance of all of the joint venture partners. In the event that a common unit adjustment is determined to be a negative number, the joint venture partner shall cause, at its election, either (a) the transfer and surrender to National CineMedia a number of common units equal to all or part of such joint venture partner's common unit adjustment or (b) pay to National CineMedia, an amount equal to such joint venture partner's common unit adjustment calculated in accordance with the Common Unit Adjustment Agreement. If the Company elects to surrender common units as part of a negative common unit adjustment, the Company would record a reduction to deferred revenue at the then fair value of the common units surrendered and a reduction of the Company’s Additional Investments Tranche at an amount equal to the weighted average cost for the Additional Investments Tranche common units, with the difference between the two values recorded as a non-operating gain or loss.

As described further below, subsequent to the IPO and through December 31, ~~2016~~2017, the Company received from National CineMedia approximately 12.49 million newly issued common units of National CineMedia ("Additional Investments Tranche") as a result of the adjustment provisions of the Common Unit Adjustment Agreement. The Company follows the guidance in ASC 323-10-35-29 (formerly EITF 02-18, Accounting for Subsequent Investments in an Investee after Suspension of Equity Loss Recognition) by analogy, which also refers to AICPA Technical Practice Aid 2220.14, which indicates that if a subsequent investment is made in an equity method investee that has experienced significant losses, the investor must determine if the subsequent investment constitutes funding of prior losses. The Company concluded that the construction or acquisition of new theatres that has led to the common unit adjustments included in its Additional Investments Tranche equates to making additional investments in National CineMedia. The Company evaluated the receipt of the additional common units in National CineMedia and the assets exchanged for these additional units and has determined that the right to use its incremental new screens would not be considered funding of prior losses. As such, the Additional Investments Tranche is accounted for separately from the Company's Initial Investment Tranche following the equity method with undistributed equity earnings included as a component of "Earnings recognized from NCM" in the accompanying consolidated financial statements.

The NCM, Inc. IPO and related transactions have the effect of reducing the amounts NCM, Inc. would otherwise pay in the future to various tax authorities as a result of an increase in Regal's proportionate share of tax basis in NCM Inc.'s tangible and intangible assets. On the IPO date, NCM, Inc., the Company, AMC and Cinemark entered into a tax receivable agreement. Under the terms of this agreement, NCM, Inc. will make cash payments to us, AMC and Cinemark in amounts equal to 90% of NCM, Inc.'s actual tax benefit realized from the tax amortization of the intangible assets described above. For purposes of the 53

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~tax~~investment ~~receivable~~is ~~agreement,~~made ~~cash~~in ~~savings~~an inequity ~~income~~method ~~and~~investee ~~franchise~~that ~~tax~~has ~~will~~experienced besignificant ~~computed~~losses, bythe ~~comparing~~investor ~~NCM, Inc.'s~~must ~~actual~~determine ~~income~~if ~~and~~the ~~franchise~~subsequent ~~tax~~investment ~~liability~~constitutes tofunding of prior losses. The Company concluded that the ~~amount~~construction or acquisition of ~~such~~new ~~taxes~~theatres that ~~NCM, Inc.~~has ~~would~~led ~~have~~to ~~been~~the ~~required~~common tounit ~~pay~~adjustments ~~had~~included ~~there~~in ~~been~~its noAdditional ~~increase~~Investments Tranche equates to making additional investments in ~~NCM Inc~~National CineMedia.'s ~~proportionate~~The ~~share~~Company evaluated the receipt of ~~tax~~the ~~basis~~additional common units in ~~NCM's~~National ~~tangible~~CineMedia and ~~intangible~~the assets exchanged for these additional units and ~~had~~has determined that the ~~tax~~right ~~receivable~~to ~~agreement~~use its incremental new screens would not ~~been~~be ~~entered~~considered ~~into~~funding of prior losses. ~~The~~As ~~tax~~such, ~~receivable~~the ~~agreement~~Additional ~~shall~~Investments ~~generally~~Tranche ~~apply~~is toaccounted ~~NCM, Inc.~~for separately from the Company's ~~taxable~~Initial ~~years~~Investment upTranche tofollowing ~~and~~the ~~including~~equity ~~the~~method ~~30th anniversary~~with ~~date~~undistributed equity earnings included as a component of ~~the~~"Earnings recognized from NCM~~, Inc.~~" ~~IPO~~in ~~and~~the ~~related~~accompanying ~~transactions.~~consolidated financial statements.

The ~~Company~~NCM, Inc. ~~accounts~~IPO ~~for~~and ~~its~~related ~~investment~~transactions inhave ~~National~~the ~~CineMedia~~effect ~~following~~of reducing the ~~equity~~amounts ~~method~~NCM, Inc. ofwould ~~accounting~~otherwise ~~and~~pay ~~such~~in ~~investment~~the isfuture ~~included~~to various tax authorities as a ~~component~~result of ~~"Other~~an ~~Non-Current~~increase ~~Assets"~~in Regal's proportionate share of tax basis in NCM Inc.'s tangible and intangible assets. On the ~~consolidated~~IPO ~~balance~~date, ~~sheets~~NCM, Inc. ~~Below~~, isthe Company, AMC and Cinemark entered into a ~~summary~~tax receivable agreement. Under the terms of ~~activity~~this ~~with~~agreement, ~~National~~NCM, Inc. ~~CineMedia~~will ~~included~~make cash payments to us, AMC and Cinemark in ~~the~~amounts ~~Company~~equal to 90% of NCM, Inc.'s ~~consolidated~~actual ~~financial~~tax ~~statements~~benefit asrealized from the tax amortization of ~~and~~the ~~for~~intangible assets described above. For purposes of the ~~years~~tax ~~ended~~receivable ~~December 31~~agreement, ~~2016~~cash savings in income and franchise tax will be computed by comparing NCM, Inc.'s ~~December~~actual income and franchise tax liability to the amount of such taxes that NCM, 31Inc. would have been required to pay had there been no increase in NCM Inc.'s proportionate share of tax basis in NCM's tangible and intangible assets and had the tax receivable agreement not been entered into. The tax receivable agreement shall generally apply to NCM, Inc.'s ~~2015~~taxable years up to and ~~January~~including the 30th 1anniversary date of the NCM, Inc. ~~2015~~IPO ~~(in~~and ~~millions):~~related transactions.

	As of the period ended								For the period ended
	Investmentin NCM			DeferredRevenue			CashReceived		Earningsrecognizedfrom NCM			OtherNCMRevenues
Balance as of and for the period ended December 26, 2013	$	158.5		$	(432.2	)	$	93.5	$	(37.5	)	$	(19.9	)
Receipt of additional common units(1)	5.9			(5.9		)	—		—			—
Receipt of excess cash distributions(2)	(10.2		)	—			27.1		(16.9		)	—
Receipt under tax receivable agreement(2)	(3.9		)	—			12.0		(8.1		)	—
Revenues earned under ESA(3)	—			—			14.2		—			(14.2		)
Amortization of deferred revenue(4)	—			9.6			—		—			(9.6		)
Equity income attributable to additional common units(5)	7.1			—			—		(7.1		)	—
Balance as of and for the period ended January 1, 2015	$	157.4		$	(428.5	)	$	53.3	$	(32.1	)	$	(23.8	)
Receipt of additional common units(1)	9.0			(9.0		)	—		—			—
Receipt of excess cash distributions(2)	(11.8		)	—			30.5		(18.7		)	—
Receipt under tax receivable agreement(2)	(3.5		)	—			9.5		(6.0		)	—
Revenues earned under ESA(3)	—			—			16.7		—			(16.7		)
Amortization of deferred revenue(4)	—			10.8			—		—			(10.8		)
Equity income attributable to additional common units(5)	6.3			—			—		(6.3		)	—
Balance as of and for the period ended December 31, 2015	$	157.4		$	(426.7	)	$	56.7	$	(31.0	)	$	(27.5	)
Receipt of additional common units(1)	9.9			(9.9		)	—		—			—
Receipt of excess cash distributions(2)	(9.3		)	—			23.3		(14.0		)	—
Receipt under tax receivable agreement(2)	(4.5		)	—			11.4		(6.9		)	—
Revenues earned under ESA(3)	—			—			16.7		—			(16.7		)
Amortization of deferred revenue(4)	—			11.6			—		—			(11.6		)
Equity income attributable to additional common units(5)	8.5			—			—		(8.5		)	—
Balance as of and for the period ended December 31, 2016	$	162.0		$	(425.0	)	$	51.4	$	(29.4	)	$	(28.3	)

The Company accounts for its investment in National CineMedia following the equity method of accounting and such investment is included as a component of "Other Non-Current Assets" in the consolidated balance sheets. Below is a summary of activity with National CineMedia included in the Company's consolidated financial statements as of and for the years ended December 31, 2017, December 31, 2016 and December 31, 2015 (in millions):

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2017, December 31, 2016 and December 31, 2015



	As of the period ended								For the period ended
	Investment in NCM			Deferred Revenue			Cash Received		Earnings recognized from NCM			Other NCM Revenues
Balance as of and for the period ended January 1, 2015	$	157.4		$	(428.5	)	$	53.3	$	(32.1	)	$	(23.8	)
Receipt of additional common units(1)	9.0			(9.0		)	—		—			—
Receipt of excess cash distributions(2)	(11.8		)	—			30.5		(18.7		)	—
Receipt under tax receivable agreement(2)	(3.5		)	—			9.5		(6.0		)	—
Revenues earned under ESA(3)	—			—			16.7		—			(16.7		)
Amortization of deferred revenue(4)	—			10.8			—		—			(10.8		)
Equity income attributable to additional common units(5)	6.3			—			—		(6.3		)	—
Balance as of and for the period ended December 31, 2015	$	157.4		$	(426.7	)	$	56.7	$	(31.0	)	$	(27.5	)
Receipt of additional common units(1)	9.9			(9.9		)	—		—			—
Receipt of excess cash distributions(2)	(9.3		)	—			23.3		(14.0		)	—
Receipt under tax receivable agreement(2)	(4.5		)	—			11.4		(6.9		)	—
Revenues earned under ESA(3)	—			—			16.7		—			(16.7		)
Amortization of deferred revenue(4)	—			11.6			—		—			(11.6		)
Equity income attributable to additional common units(5)	8.5			—			—		(8.5		)	—
Balance as of and for the period ended December 31, 2016	$	162.0		$	(425.0	)	$	51.4	$	(29.4	)	$	(28.3	)
Receipt of additional common units(1)	6.3			(6.3		)	—		—			—
Receipt of excess cash distributions(2)	(12.2		)	—			29.4		(17.2		)	—
Receipt under tax receivable agreement(2)	(3.4		)	—			8.3		(4.9		)	—
Revenues earned under ESA(3)	—			—			17.1		—			(17.1		)
Amortization of deferred revenue(4)	—			12.8			—		—			(12.8		)
Equity income attributable to additional common units(5)	7.6			—			—		(7.6		)	—
Change in interest loss(6)	(5.6		)	—			—		5.6			—
Balance as of and for the period ended December 31, 2017	$	154.7		$	(418.5	)	$	54.8	$	(24.1	)	$	(29.9	)

_______________________________________________________________________________

(1) On March 1716, ~~2016~~2017, March 17, ~~2015~~2016, and March 1317, ~~2014~~2015, we received from National CineMedia approximately 0.75 million, 0.67 million and 0.46 million, respectively, newly issued common units of National CineMedia in accordance with the annual adjustment provisions of the Common Unit Adjustment Agreement. The Company recorded the additional common units (Additional Investments Tranche) at fair value using the available closing stock prices of NCM, Inc. as of the dates on which the units were issued. As a result of these adjustments, the Company recorded increases to its investment in National CineMedia (along with corresponding increases to deferred revenue) of $96.93 million, $9.09 million and $5.9.0 million during the years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015, respectively. Such deferred revenue amounts are being amortized to advertising revenue over the remaining term of the ESA between RCI and National CineMedia following the units of revenue method as described in (4) below. As of December 31, ~~2016~~2017, we held approximately 27.16 million common units of National CineMedia. On a fully diluted basis, we own a 1917.79% interest in NCM, Inc. as of December 31, ~~2016~~2017.

59(2) During the years ended December 31, 2017, December 31, 2016 and December 31, 2015, the Company received $37.7 million, $34.7 million, $40.0 million, respectively, in cash distributions from National CineMedia, exclusive of receipts for services performed under the ESA (including payments of $8.3 million, $11.4 million, and $9.5 million received under the tax receivable agreement). Approximately $15.6 million, $13.8 million and $15.3 million of these cash distributions received during the years ended December 31, 2017, December 31, 2016 and December 31, 2015, respectively, were attributable to the Additional Investments Tranche and were recognized as a reduction in our investment in National CineMedia. The remaining amounts were recognized in equity earnings during each of these periods and have been included as components of "Earnings recognized from NCM" in the accompanying consolidated financial statements.

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

(23) ~~During~~The ~~the~~Company ~~years~~recorded ~~ended~~other ~~December 31~~revenues, ~~2016,~~excluding ~~December~~the ~~31,~~amortization ~~2015~~of ~~and~~deferred ~~January 1~~revenue, ~~2015,~~of ~~the~~approximately ~~Company received~~ $3417.71 million, $4016.07 million, and $3916.17 million, ~~respectively,~~for inthe ~~cash~~years ~~distributions~~ended ~~from~~December ~~National~~31, ~~CineMedia~~2017, ~~exclusive~~December of31, ~~receipts~~2016 ~~for~~and ~~services~~December ~~performed~~31, ~~under~~2015, ~~the~~respectively, ~~ESA~~pertaining ~~(including~~to ~~payments~~our ofagreements ~~$11.4~~with ~~million~~National CineMedia, ~~$9.5~~including ~~million,~~per patron and ~~$12.0~~per ~~million~~digital ~~received~~screen ~~under~~theatre ~~the~~access ~~tax~~fees ~~receivable~~(net ~~agreement).~~of ~~Approximately~~payments $1312.85 million, $1512.32 million and $1411.18 million offor ~~these cash distributions received during~~ the years ended December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015, respectively, ~~were~~for ~~attributable~~on-screen toadvertising ~~the~~time ~~Additional~~provided ~~Investments~~to ~~Tranche~~our ~~and~~beverage ~~were~~concessionaire) ~~recognized~~and asother aNCM ~~reduction in our investment in National CineMedia~~revenues. ~~The~~These ~~remaining~~advertising ~~amounts~~revenues ~~were~~are ~~recognized~~presented inas ~~equity~~a ~~earnings~~component ~~during each~~ of ~~these periods and have been included as components of~~ "~~Earnings~~Other ~~recognized~~operating ~~from NCM~~revenues" in the ~~accompanying~~Company's consolidated financial statements.

(3) The Company recorded other revenues, excluding the amortization of deferred revenue, of approximately $16.7 million, $16.7 million and $14.2 million for the years ended December 31, 2016, December 31, 2015 and January 1, 2015, respectively, pertaining to our agreements with National CineMedia, including per patron and per digital screen theatre access fees (net of payments $12.2 million, $11.8 million and $14.0 million for the years ended December 31, 2016, December 31, 2015 and January 1, 2015, respectively, for on-screen advertising time provided to our beverage concessionaire) and other NCM revenues. These advertising revenues are presented as a component of "Other operating revenues" in the Company's consolidated financial statements.


(4)	Amounts represent amortization of ESA modification fees received from NCM to advertising revenue utilizing the units of revenue amortization method. These advertising revenues are presented as a component of "Other operating revenues" in the Company's consolidated financial statements.

(5) Amounts represent the Company's share in the net ~~income~~gain (loss) of National CineMedia with respect to the Additional Investments Tranche. Such amounts have been included as a component of "Earnings recognized from NCM" in the consolidated financial statements.

As(6) ofThe ~~December 31,~~Company ~~2016,~~recorded ~~approximately~~a ~~$2.8~~non-cash ~~million~~change ~~and~~in interest loss of $15.36 million ~~due~~during ~~from/to~~the ~~National~~quarter ~~CineMedia~~ended ~~were~~March ~~included~~31, in2017 ~~"Trade~~to ~~and~~adjust ~~other~~the ~~receivables,~~Company's ~~net"~~investment ~~and~~balance ~~"Accounts~~due ~~payable,"~~to ~~respectively. As~~NCM's issuance of ~~December~~common ~~31,~~units ~~2015~~to other founding members, ~~approximately~~at ~~$2.8~~a ~~million~~price ~~and~~per ~~$1.3~~share ~~million~~below ~~due~~the ~~from/to~~Company's ~~National~~average ~~CineMedia~~carrying ~~were~~amount ~~included~~per inshare. ~~"Trade~~Such ~~and~~amount ~~other~~has ~~receivables,~~been ~~net"~~included ~~and~~as a component of "~~Accounts~~Earnings ~~payable,~~recognized from NCM" ~~respectively~~in the consolidated financial statements.

As of ~~the~~December 31, ~~date~~2017, ofapproximately ~~this~~$3.1 ~~Form~~million ~~10-K,~~and no$1.5 ~~summarized~~million ~~financial~~due ~~information~~from/to ~~for~~ National CineMedia ~~was~~were ~~available~~included ~~for~~in ~~the~~"Trade ~~year~~and ~~ended~~other ~~December~~receivables, 31net" and "Accounts payable," ~~2016~~respectively. ~~Summarized~~As ~~consolidated statements~~ of ~~income~~December 31, ~~information~~2016, ~~for~~approximately ~~National~~$2.8 ~~CineMedia~~million ~~for~~and ~~the~~$1.3 ~~years~~million ~~ended~~due ~~December~~from/to ~~31,~~National ~~2015,~~CineMedia ~~January~~were 1,included ~~2015~~in "Trade and ~~December~~other 26receivables, ~~2013~~net" isand as"Accounts ~~follows~~payable," ~~(in millions):~~respectively.

	Year EndedDecember 31, 2015		Year EndedJanuary 1, 2015		Year EndedDecember 26, 2013
Revenues	$	446.5	$	394.0	$	462.8
Income from operations	140.5		159.2		202.0
Net income	87.5		96.3		162.9

As of the date of this Form 10-K, no summarized financial information for National CineMedia was available for the year ended December 31, 2017. Summarized consolidated statements of income information for National CineMedia for the years ended December 29, 2016 December 31, 2015, and January 1, 2015 is as follows (in millions):

	December 31, 2015			January 1, 2015
	Year EndedDecember 29, 2016			Year EndedDecember 31, 2015			Year EndedJanuary 1, 2015
Current assets	$	159.5		$	134.9
Revenues	$	447.6		$	446.5		$	394.0
Noncurrent assets	623.1			546.2
Income from operations	173.0			140.5			159.2
Total assets	782.6			681.1
Net income	109.3			87.5			96.3
Current liabilities	113.1			106.5
Noncurrent liabilities	936.0			892.0
Total liabilities	1,049.1			998.5
Members' deficit	(266.5		)	(317.4		)
Liabilities and members' deficit	782.6			681.1

Summarized consolidated balance sheet information for National CineMedia as of December 29, 2016 and December 31, 2016 is as follows (in millions):



	December 29, 2016			December 31, 2015
Current assets	$	180.9		$	159.5
Noncurrent assets	607.6			612.5
Total assets	788.5			772.0
Current liabilities	121.1			113.1
Noncurrent liabilities	924.3			925.4
Total liabilities	1,045.4			1,038.5
Members' deficit	(256.9		)	(266.5		)
Liabilities and members' deficit	788.5			772.0

Investment in Digital Cinema Implementation Partners

We maintain an investment in Digital Cinema Implementation Partners, LLC, a Delaware limited liability company ("DCIP"). DCIP is a joint venture company formed by Regal, AMC and Cinemark. DCIP funds the cost of digital projection equipment principally through the collection of virtual print fees from motion picture studios and equipment lease payments

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REGAL ENTERTAINMENT GROUP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, ~~2016~~2017, December 31, ~~2015~~2016 and ~~January~~December 131, 2015

~~Investment~~from participating exhibitors, including us. In addition to its U.S. digital deployment, DCIP actively manages the deployment of over 1,800 digital systems in Canada for Canadian Digital Cinema ~~Implementation~~Partnership, ~~Partners~~a joint venture between Cineplex Inc. and Empire Theatres Limited.

WeRegal ~~maintain~~holds ana ~~investment~~46.7% economic interest in ~~Digital~~DCIP ~~Cinema~~as ~~Implementation~~of ~~Partners~~December 31, ~~LLC,~~2017 and a ~~Delaware~~one-third ~~limited~~voting ~~liability~~interest ~~company~~along ~~("DCIP"). DCIP~~with issubsidiaries aof ~~joint~~each ~~venture~~of ~~company formed by Regal,~~ AMC and Cinemark. ~~DCIP~~ ~~funds~~Since the ~~cost~~Company ofdoes ~~digital~~not ~~projection~~have ~~principally~~a ~~through~~controlling ~~the~~financial ~~collection~~interest ofin ~~virtual~~DCIP ~~print~~or ~~fees~~any ~~from~~of ~~motion~~its ~~picture~~subsidiaries, ~~studios~~it ~~and~~accounts ~~equipment~~for ~~lease~~its ~~payments~~investment ~~from~~in ~~participating~~DCIP ~~exhibitors,~~under ~~including~~the ~~us. In~~equity ~~addition~~method toof ~~its U~~accounting.S. ~~digital~~The ~~deployment,~~Company's investment in DCIP ~~actively~~is ~~manages~~included ~~the~~as ~~deployment~~a component of ~~over~~"Other ~~1,800~~Non-Current ~~digital~~Assets" ~~systems~~in the accompanying consolidated balance sheets. The changes in ~~Canada~~the carrying amount of our investment in DCIP for ~~Canadian~~the ~~Digital~~years ~~Cinema~~ended ~~Partnership~~December 31, a2017, ~~joint~~December 31, ~~venture~~2016, ~~between~~and ~~Cineplex~~December 31, ~~Inc.~~2015 ~~and~~are ~~Empire~~as ~~Theatres~~follows ~~Limited.~~ (in millions):

Regal holds a 46.7% economic interest in DCIP as of December 31, 2016 and a one-third voting interest along with each of AMC and Cinemark. Since the Company does not have a controlling financial interest in DCIP or any of its subsidiaries, it accounts for its investment in DCIP under the equity method of accounting. The Company's investment in DCIP is included as a component of "Other Non-Current Assets" in the accompanying consolidated balance sheets. The changes in the carrying amount of our investment in DCIP for the years ended December 31, 2016, December 31, 2015, and January 1, 2015 are as follows (in millions):



Balance as of January 1, 2015	$	126.3
Equity contributions	0.4
Equity in earnings of DCIP(1)	37.0
Receipt of cash distributions(2)	(2.0		)
Change in fair value of equity method investee interest rate swap transactions	(1.0		)
Balance as of December 31, 2015	160.7
Equity contributions	0.5
Equity in earnings of DCIP(1)	41.6
Receipt of cash distributions(2)	(9.7		)
Change in fair value of equity method investee interest rate swap transactions	0.1
Balance as of December 31, 2016	193.2
Equity contributions	1.2
Equity in earnings of DCIP(1)	43.5
Receipt of cash distributions(2)	(9.5		)
Change in fair value of equity method investee interest rate swap transactions	0.3
Balance as of December 31, 2017	$	228.7

Balance as of December 26, 2013	$	101.6
Equity contributions	3.6
Equity in earnings of DCIP(1)	28.6
Receipt of cash distributions(2)	(6.3		)
Change in fair value of equity method investee interest rate swap transactions	(1.2		)
Balance as of January 1, 2015	126.3
Equity contributions	0.4
Equity in earnings of DCIP(1)	37.0
Receipt of cash distributions(2)	(2.0		)
Change in fair value of equity method investee interest rate swap transactions	(1.0		)
Balance as of December 31, 2015	160.7
Equity contributions	0.5
Equity in earnings of DCIP(1)	41.6
Receipt of cash distributions(2)	(9.7		)
Change in fair value of equity method investee interest rate swap transactions	0.1
Balance as of December 31, 2016	$	193.2

_______________________________________________________________________________


(1)	Represents the Company's share of the net income of DCIP. Such amount is presented as a component of "Equity in income of non-consolidated entities and other, net" in the accompanying consolidated statements of income.


(2)	Represents cash distributions from DCIP as a return on its investment.

In accordance with the master equipment lease agreement (the "Master Lease"), the digital projection systems are leased from a subsidiary of DCIP under a 12-year term with ten one-year fair value renewal options. The Master Lease also contains a fair value purchase option. On ~~March~~As of December 31, ~~2014~~2017, ~~the~~under ~~junior capital raised by DCIP in~~ the ~~initial~~Master ~~financing transactions was paid in full by DCIP. In connection with this repayment~~Lease, the ~~Master~~Company ~~Lease~~pays ~~was~~annual ~~amended to eliminate the incremental~~ minimum rent ~~payment provision~~ of $21,000 per digital projection system~~. DCIP~~ ~~incurred~~through athe ~~loss~~end ~~on debt extinguishment~~ of ~~approximately~~the $6lease term.0 The ~~million~~Company asconsiders ~~a result of~~ the ~~debt~~$1,000 ~~repayment~~rent ~~and~~payment ~~Regal~~to ~~recorded~~be ~~its~~a ~~pro~~minimum ~~rata~~rental, ~~share~~and ofaccordingly, records such

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