Mail Stop 03-05
May 3, 2005
Via U.S. Mail
Mr. Craig R. Ramsey
Executive Vice President and Chief Financial Officer
AMC Entertainment Inc.
920 Main Street
Kansas City, Missouri 64105
Re: AMC Entertainment Inc.
Amendment No. 2 to Form S-2, filed on April 18, 2005, File
No.
333-122389
Amendment No. 2 to Form S-4, filed on April 18, 2005, File
No.
333-122376
Form 10-Q for the quarterly period ended December 30, 2004,
File
No. 001-08747
Dear Mr. Ramsey,
We have reviewed your Form S-2 and Form 10-Q and have the
following comments. We are also monitoring your Form S-4 for
compliance with the comments below and for the signature page.
Where
indicated, we think you should revise your document in response to
these comments. If you disagree, we will consider your
explanation
as to why our comment is inapplicable or a revision is
unnecessary.
Please be as detailed as necessary in your explanation. In some
of
our comments, we may ask you to provide us with supplemental
information so we may better understand your disclosure. After
reviewing this information, we may or may not raise additional
comments.
The purpose of our review process is to assist you in your
compliance with the applicable disclosure requirements and to
enhance
the overall disclosure in your filing. We look forward to working
with you in these respects and welcome any questions you may have
about our comments or on any other aspect of our review. Feel
free
to call us at the telephone numbers listed at the end of this
letter.
FORM S-2
Risk Factors, page 15
Our substantial debt could adversely affect our operations, page
15
1. We note your revisions made in response to prior comment 2,
however, please also revise the corresponding risk factor on your
Form S-4 on page 19.
Unaudited Pro Forma Condensed Consolidated Financial Information,
pages 32 - 38
2. We note that the pro forma statements of operations have been
appropriately revised to reflect the impact of your recent
contribution to National CineMedia, LLC. In view of the relative
significance of this transaction, it appears that these activities
should be reflected in a pro forma balance sheet as well. Please
revise or advise.
3. As your pro forma statements of operations now reflect the
occurrence of two individually significant transactions, please
expand your presentation to separately reflect the impact of each
transaction. Specifically, please present the pro forma
adjustments
attributable to the merger and related transactions followed by a
subtotal. The pro forma adjustments related to the recent
contribution to National CineMedia, LLC should then be presented
and
followed by a column containing the final "pro forma" balances.
Please revise accordingly.
4. As a related matter, the purpose of Rule 3-10 of Regulation S-X
is
to provide financial information that allows investors to evaluate
a
guarantor`s ability to honor their commitment under the guarantee.
We require condensed consolidated information so that the reader
can
clearly distinguish the assets, liabilities, revenues, expenses
and
cash flows of the entities that are legally obligated under the
indenture from those that are not. This information also
facilitates
analysis of trends affecting subsidiary guarantors and
relationships
among the various components of a consolidated entity. Given the
nature and relative significance of the transactions reflected in
your pro forma financial statements, the condensed consolidating
financial information presented in the historical financial
statements no longer appears to adequately achieve these purposes.
Accordingly, please expand your pro forma presentation to also
include condensed consolidating financial information on a pro
forma
basis for the most recent fiscal year and interim period.
December 30, 2004 Interim Financial Statements, page F-13
Note 2. Acquisitions, page F-19
5. Refer to our prior comments 31 and 32. It appears that your
transaction was approximately 46% debt financed. Please confirm
or
advise supplementally.
6. As a related matter, we understand that the ownership interests
in
Holdings were initially held by JPMP (50.1%) and Apollo (49.9%).
These ownership interests subsequently appear to have fallen to
approximately 34.6% each as a result of sales to related parties,
affiliates and management. Supplementally tell us the percentage
controlled by each of the sponsors subsequent to the above
referenced
sales. That is, we assume that JPMP and its affiliates continue
to
hold a greater combined ownership interest than the combined
ownership interest held by Apollo and its affiliates. Please
confirm
or advise, supplementally.
7. We note your revised disclosures in response to prior comment
36.
Please further expand the discussion on page F-21 and in the pro
forma footnote 3(a) on page 37 to describe your method of
determining
the useful life of the MovieWatcher (i.e., loyalty program)
customer
relationship intangible asset. In this regard, where you have
disclosed in the table on page 37 that the estimated useful life
is 8
years, describe in detail how you determined the amortization
period
to be less than 8 years, as specifically discussed in the second
and
third paragraphs of your response.
Exhibit 5.1
8. We note your response to prior comments 10, 12, 15 and 20.
Please
be aware for your planning purposes that we will review and may
comment on Exhibits 5.1, 5.2, 5.3 and 5.5 prior to the time you
are
declared effective.
Exhibit 5.6
9. On page 2, please delete section (c) that begins with "Our
knowledge of the business, records, transactions..." It is
inappropriate to limit your opinion to the items that Premium has
brought to your attention or the documents specifically referred
to
in your opinion.
10. We reissue prior comment 22. Please revise to omit the next-
to-
last paragraph or refile the opinion dated the date of
effectiveness.
Other
11. Please continue to consider the financial statement updating
requirements set forth in Rule 3-12 of Regulation S-X.
12. Amendments should contain currently dated accountants`
consents.
Manually signed consents should be kept on file for five years.
Reference is made to Rule 402 of Regulation C.
FORM S-4
General
13. Please amend this Registration Statement on Form S-4 to
reflect
comments issued on your Registration Statement on Form S-2.
14. Please continue to consider the financial statement updating
requirements set forth in Rule 3-12 of Regulation S-X.
15. Amendments should contain currently dated accountants`
consents.
Manually signed consents should be kept on file for five years.
Reference is made to Rule 402 of Regulation C.
* * * * *
As appropriate, please amend the registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
You may contact Beverly Singleton at (202) 551-3328 or
Margery
Reich at (202) 551-3347 if you have questions regarding comments
on
the financial statements and related matters. Please contact
Rolaine
Bancroft at (202) 551-3313 or me at (202) 551-3755 with any other
questions.
Regards,
Max A. Webb
Assistant Director
cc: Gregory Ezring, Esq.
Monica K. Thurmond, Esq.
Latham & Watkins LLP
via facsimile: (212) 751-4864
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Mr. Craig R. Ramsey
AMC Entertainment Inc.
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