A new Cinema City multiplex to be run in Romania - Memorandum of understanding with respect to lease agreement
The Board of Managing Directors of Cinema City International N.V. (the "Company") informs that on May 2007 Cinema City Romania S.R.L, a wholly-owned subsidiary of the Company incorporated and existing under the laws of Romania, executed the binding memorandum of understanding providing general and most crucial terms and conditions for lease (the "Agreement") with SC Arena City Center SRz., a company incorporated and existing under the laws of Romania.
In accordance with the Agreement Cinema City Romania S.R.L will be leasing areas in the Arena City Center shopping mall in Bacau - one of the largest city in Romania with the population of 200 thousand inhabitants. The rent areas will be used by the Company to operate a multiplex cinema as specified below:
|No.||City||Leased area (ca. in sqm)||Number of screens||Number of seats||Expected opening date|
|1.||BACAU||2,300||8||1380||First quarter 2008|
The detailed terms and conditions of the lease will be determined in the lease agreement to be concluded in the foreseeable future and in accordance with all terms and conditions of the Agreement.
The Agreement contains standard provisions, typical for agreements of such kind and gives the Company the right to lease the cinema space for 25 years (the lease agreement will be concluded for ten years with three options of extending a lease term, each for another five years). The Company will be required to pay a monthly rent on a market standards consisting of a fixed rent calculated on the basis of the leased area and the management fee for the benefit of the management company of the shopping mall.
The Agreement will enable the Company to run another cinema multiplex located in the new EU member state - Romania and will strengthen the Company's position in Romanian developing cinema industry.
Legal grounds: Art. 56.1.1 of the Act of 29 July 2005 on the public offering, conditions governing the introduction of financial instruments to organised trading system and on public companies.
A signature of persons authorised to represent the Company: Mr. Israel Greidinger-a Managing Director, proxy