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

SCHEDULE 14A
(Rule 14a-101)

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934

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As of November 22, 2004, there were outstanding 34,019,497 shares of Common Stock; 3,051,597 shares of Class B Stock and 305,548 shares of Series A Convertible Preferred Stock. The filing fee was determined by adding (x) the product of (i) the 37,071,094 shares of Common and Class B Stock proposed to be acquired in the merger and (ii) the merger consideration of $19.50 in cash per share of Common and Class B Stock, plus (y) the product of (i) the 338,960 shares of Series A Convertible Preferred Stock proposed to be acquired in the merger (consisting of the 305,548 shares of Series A Convertible Preferred Stock outstanding on November 22, 2004, plus the 33,412 shares of Series A Convertible Preferred Stock to be issued as a special distribution prior to the consummation of the merger) and (ii) the merger consideration of $2,727.27 in cash per share of Series A Convertible Preferred Stock, plus (z) $18,041,155 payable to holders of outstanding stock option, warrants and deferred stock units granted by AMCE in exchange for the cancellation of such options, warrants and deferred stock units. The payment of the filing fee, calculated in accordance with Fee Rate Advisory #7 for Fiscal Year 2004 (Updated), equals $126.70 per million of the aggregate merger consideration calculated pursuant to the preceding sentence.

AMC ENTERTAINMENT INC.

920 MAIN STREET

KANSAS CITY, MISSOURI 64105

        You are cordially invited to attend a special meeting of the stockholders of AMC Entertainment Inc., a Delaware corporation ("AMCE"), to be held on December 23, 2004, at 9:00 a.m. local time at AMC Town Center 20 Theatres, 11701 Nall Avenue, Leawood, Kansas 66211.

        At the special meeting, you will be asked to consider and vote upon a merger agreement dated as of July 22, 2004, by and among AMCE, Marquee Holdings Inc. and Marquee Inc., a direct wholly-owned subsidiary of Marquee Holdings Inc., pursuant to which Marquee Inc. will be merged with and into AMCE, with AMCE as the surviving corporation in the merger. Upon completion of the merger, (1) each issued and outstanding share of AMCE common stock and AMCE Class B stock will be converted into the right to receive $19.50 in cash and (2) each issued and outstanding share of AMCE series A convertible preferred stock will be converted into the right to receive $2,727.27 in cash. A copy of the merger agreement is included as Annex A to these materials.

        Following completion of the merger, AMCE will continue its operations as a privately-held company, wholly owned by Marquee Holdings Inc. Marquee Holdings Inc. is a newly-formed corporation that is jointly owned by funds affiliated with J.P. Morgan Partners and funds affiliated with Apollo. Funds affiliated with Apollo are collectively one of our principal stockholders. It is anticipated that certain members of our management may purchase or be granted equity interests in Marquee Holdings Inc. If the merger is completed, AMCE will no longer have its stock quoted on the American Stock Exchange. After the merger, you will no longer have an equity interest in AMCE and will not participate in any potential future earnings and growth of AMCE.

        On May 25, 2004, our Board of Directors formed an Independent Committee consisting of two of our independent directors, Messrs. Charles S. Sosland and Paul E. Vardeman, to review, evaluate and make recommendations to the Board of Directors on behalf of our stockholders (other than the Apollo Funds and the Durwood Voting Trust) with respect to a possible sale of AMCE. The Independent Committee believes the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to and in the best interests of AMCE and its common stockholders, other than those stockholders described in the attached document. Our Independent Committee recommends to the holders of our common stock, other than those stockholders described in the attached document, that they vote "FOR" adoption of the merger agreement.

        Our Board of Directors believes the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to and in the best interests of AMCE and its stockholders. Based in part on the recommendation of the Independent Committee, our Board of Directors has adopted the merger agreement and unanimously (with the three directors affiliated with Apollo choosing to abstain) recommends that you vote "FOR" adoption of the merger agreement.

        In arriving at their respective recommendations of the merger agreement and the merger, each of our Board of Directors and the Independent Committee carefully considered a number of factors which are described in the accompanying proxy statement. You should read these factors, as well as all of the other information contained in the attached document, in their entirety.

        Your vote is very important. The merger cannot be completed unless the merger agreement is adopted by the affirmative vote of a majority of the votes entitled to be cast by the following stockholders (in each case as of the record date), voting together as a single class: (1) holders of the outstanding shares of AMCE common stock, (2) holders of the outstanding shares of AMCE Class B stock and (3) holders of outstanding shares of AMCE preferred stock who are not affiliated with Apollo. The Durwood Voting Trust, which as of November 22, 2004, the record date for the special meeting, owned 100% of the outstanding shares of AMCE Class B stock, representing approximately 45.5% of the votes entitled to be cast at the special meeting, has entered into a voting agreement pursuant to which it has agreed, among other things, to vote all its shares in favor of the adoption of the merger agreement and the transactions contemplated by the merger agreement. In addition, the Apollo Funds, which as of the record date owned shares of AMCE common stock representing in the aggregate approximately 0.2% of the outstanding votes entitled to be cast at the special meeting, have also entered into a consent and voting agreement pursuant to which they have agreed, among other things, to vote all of their shares of AMCE common stock in favor of the adoption of the merger agreement and the transactions contemplated by the merger agreement.

        If you do not expect to attend the meeting in person, it is important that your shares be represented. Please use the enclosed proxy card to vote on the matters to be considered at the meeting, sign and date the proxy card and mail it promptly in the enclosed envelope, which requires no postage if mailed in the United States. You may also vote via the internet as indicated on the proxy card instructions. You may revoke your proxy at any time before the meeting by written notice to such effect, by submitting a subsequently dated proxy or by attending the meeting and voting in person. If your shares are held in "street name," you should instruct your broker how to vote in accordance with your voting instruction form.

        The accompanying proxy statement explains the proposed merger and provides specific information concerning the special meeting. I urge you to read these materials carefully.

	Sincerely,
	Peter C. Brown Chairman of the Board

Kansas City, Missouri
November 24, 2004

        Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved the merger, passed upon the merits or fairness of the merger agreement or the transactions contemplated thereby, including the proposed merger, or passed upon the adequacy or accuracy of the information contained in this document. Any representation to the contrary is a criminal offense.

        The accompanying proxy statement is dated November 24, 2004 and is first being mailed to stockholders of AMCE on or about November 26, 2004.

AMC ENTERTAINMENT INC.

920 MAIN STREET

KANSAS CITY, MISSOURI 64105

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER 23, 2004

To the Stockholders of AMC Entertainment Inc.:

        Notice is hereby given that a special meeting of the stockholders of AMC Entertainment Inc., a Delaware corporation ("AMCE"), will be held on December 23, 2004 at 9:00 a.m. local time at AMC Town Center 20 Theatres, 11701 Nall Avenue, Leawood, Kansas 66211, for the following purposes:

        1.     To consider and vote upon a proposal to adopt the Agreement and Plan of Merger, dated as of July 22, 2004, by and among AMCE, Marquee Holdings Inc. and Marquee Inc., pursuant to which Marquee Inc., a direct wholly-owned subsidiary of Marquee Holdings Inc., will be merged with and into AMCE, with AMCE as the surviving corporation. Upon completion of the merger, (1) each issued and outstanding share of AMCE common stock and AMCE Class B stock will be converted into the right to receive $19.50 in cash and (2) each issued and outstanding share of AMCE Series A convertible preferred stock will be converted into the right to receive $2,727.27 in cash.

        2.     To consider and vote upon any other matters that properly come before the special meeting or any adjournments or postponements of the special meeting.

        Only holders of record of AMCE common stock, Class B stock and Series A convertible preferred stock not held by affiliates of Apollo Management IV, L.P. or Apollo Management V, L.P. at the close of business on November 22, 2004, the record date of the special meeting, are entitled to notice of, and to vote at, the special meeting or any adjournments or postponements of the special meeting. A complete list of stockholders entitled to vote at the AMCE special meeting will be available for examination at our headquarters, 920 Main Street, Kansas City, Missouri after December 9, 2004 and at the special meeting.

	By order of the Board of Directors,
	Kevin M. Connor Senior Vice President, General Counsel and Secretary

Kansas City, Missouri

November 24, 2004

YOUR VOTE IS IMPORTANT

        Even if you do not expect to attend the meeting in person, it is important that your shares be represented. Please use the enclosed proxy card to vote on the matters to be considered at the meeting, sign and date the proxy card and mail it promptly in the enclosed envelope, which requires no postage if mailed in the United States. You may also vote via the internet as indicated on the proxy card instructions. You may revoke your proxy at any time before the meeting by written notice to such effect, by submitting a subsequently dated proxy or by attending the meeting and voting in person.

Proxy Statement

Table of Contents

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AMC ENTERTAINMENT INC.

PROXY STATEMENT

Summary Term Sheet

        This Summary Term Sheet highlights selected information contained in this proxy statement and may not contain all of the information that is important to you. You are urged to read this entire proxy statement carefully, including the appendices. In addition, we incorporate by reference important business and financial information about us into this proxy statement. You may obtain the information incorporated by reference into this proxy statement without charge by following the instructions in the section entitled "Where Stockholders Can Find More Information." In this proxy statement, the terms "we," "us," "our," "AMCE" and the "Company" refer to AMC Entertainment Inc. We refer to J.P. Morgan Partners (BHCA), L.P. and certain affiliated funds that will own an equity interest in AMCE following the merger collectively as the "JPMP Investors" and to J.P. Morgan Partners, LLC, which serves as the investment advisor for the JPMP Investors, as "J.P. Morgan Partners." We refer to Apollo Management IV, L.P. and Apollo Management V, L.P. as "Apollo Management", to certain related investment funds and AP Entertainment, LLC, an affiliate of Apollo Management V, L.P., which each currently own an equity interest in AMCE collectively as the "Apollo Funds," and to Apollo Management and the Apollo Funds collectively as "Apollo." We also refer to Apollo Investment Fund V, L.P. and certain related investment funds that will own an equity interest in AMCE following the merger as the "Apollo Investors." We refer to Marquee Holdings Inc. as "Holdings" and to Marquee Inc. as "Marquee." We refer to Mr. Peter C. Brown, our Chief Executive Officer, and Mr. Philip M. Singleton, our Chief Operating Officer, both of whom will purchase an equity interest in Holdings immediately prior to consummation of the merger, as "The Management Investors." We refer to the stockholders of AMCE, other than Apollo, Holdings, Marquee and the Management Investors, and their respective affiliates, as "the unaffiliated AMCE stockholders."

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Certain Questions and Answers About the Merger

        The following questions and answers are for your convenience only, and briefly address some commonly asked questions about the merger. You should still carefully read this entire proxy statement, including the attached appendices.

Q:

Why am I receiving these materials?

A:

Our Board of Directors is providing these proxy materials to give you information for use in determining how to vote in connection with the special meeting of our stockholders.

Q:

When and where is the special meeting?

A:

The special meeting of our stockholders will be held at 9:00 a.m. local time on December 23, 2004, at AMC Town Center 20 Theatres, 11701 Nall Avenue, Leawood, Kansas, 66211.

Q:

What am I being asked to vote upon?

A:

You are being asked to consider and vote upon a proposal to adopt the merger agreement, pursuant to which Marquee will merge with and into AMCE, with AMCE as the surviving corporation in the merger.

Q:

Who can vote on the merger agreement?

A:

All holders of AMCE common stock and Class B stock, and those holders of AMCE preferred stock that are not affiliated with Apollo, in each case, at the close of business on November 22, 2004, the record date for the special meeting, may vote in person or by proxy on the adoption of the merger agreement at the special meeting.

Q:

What vote is required to adopt the merger agreement?

A:

The merger agreement must be adopted by the affirmative vote of a majority of the votes entitled to be cast by the following stockholders (in each case as of the record date), voting together as a single class: (1) holders of the outstanding shares of AMCE common stock, (2) holders of the outstanding shares of AMCE Class B stock and (3) holders of outstanding shares of AMCE preferred stock who are not affiliated with Apollo. The Durwood Voting Trust which, as of the record date, owned 3,051,597 shares of AMCE class B stock, representing approximately 45.5% of the outstanding votes entitled to be cast, has entered into a voting agreement pursuant to which, on the terms and subject to the conditions contained therein, it has agreed, among other things, to vote all of its shares in favor of adoption of the merger agreement. See "The Voting Agreements—Durwood Trust Voting Agreement" on page 144. In addition, the Apollo Funds, which, as of the record date, owned an aggregate of 166,258 shares of AMCE common stock, representing approximately 0.2% of the outstanding votes entitled to be cast, and Apollo Management have entered into a consent and voting agreement pursuant to which, on the terms and subject to the conditions contained therein, they have agreed, among other things, to vote all of their shares in favor of adoption of the merger agreement. See "The Voting Agreements—Apollo Consent and Voting Agreement" on page 143. Assuming compliance by the Durwood Voting Trust and the Apollo Funds with the terms of their respective voting agreements, an additional 2,849,143 votes, representing approximately 4.3% of the total votes entitled to be cast at the meeting, must be voted in favor of adoption of the merger agreement by the other holders of AMCE common stock and AMCE preferred stock in order to complete the merger. Of this amount, we note that those directors and executive officers (including the Management Investors) who owned AMCE common stock, as of the record date, representing in the aggregate approximately 1% of the outstanding votes entitled to be cast, have indicated that, although they are not obligated to do so, they intend to vote their shares of AMCE common stock in favor of adoption of the merger agreement but make no recommendation as to how any holder of AMCE stock should vote on the merger.

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Q:

What will happen in the merger?

A:

In the merger, Marquee will be merged with and into AMCE, with AMCE surviving the merger. Upon completion of the merger, (1) each issued and outstanding share of AMCE common stock and AMCE Class B stock will be converted into the right to receive $19.50 in cash and (2) each issued and outstanding share of AMCE preferred stock will be converted into the right to receive $2,727.27 in cash. As a result, following the merger, AMCE will be wholly-owned by Holdings. See "Special Factors—Certain Effects of the Merger" beginning on page 30.

Following completion of the merger, AMCE, as the surviving corporation, will no longer have common stock quoted on the American Stock Exchange. Our existing stockholders, other than the Apollo Investors, the Management Investors and certain other members of AMCE management who may purchase or be granted equity interests in Holdings prior to or upon consummation of the merger, will no longer have an equity interest in AMCE and will not participate in any potential future earnings and growth of AMCE.

Q:

What will I receive in the merger?

A:

Upon completion of the merger, you will receive (1) $19.50 in cash for each issued and outstanding share of AMCE common stock and AMCE Class B stock you own and (2) $2,727.27 in cash for each issued and outstanding share of AMCE preferred stock you own. See "Special Factors—Certain Effects of the Merger" beginning on page 30.

Q:

What are the reasons for the merger?

A:

In approving the merger agreement and related agreements, and recommending that AMCE's stockholders vote for the adoption of the merger agreement, the Board of Directors of AMCE considered a number of factors, including, among other factors, the Independent Committee's recommendation of the merger and the fairness opinion delivered to the Board of Directors by Goldman Sachs. For a discussion of the factors considered by our Board of Directors and the Independent Committee see "Special Factors—Reasons for the Board's Recommendation; Factors Considered" beginning on page 60 and "Special Factors—Reasons for the Independent Committee's Recommendation; Factors Considered" beginning on page 55.

Q:

What was the role of the Independent Committee?

A:

The Independent Committee of our Board of Directors, consisting of Messrs. Charles S. Sosland and Paul E. Vardeman, two members of our Board of Directors who are not employed by, or otherwise affiliated with, any of AMCE, Apollo or the Durwood Voting Trust, was formed to review, evaluate and make recommendations to the Board of Directors with respect to the transaction on behalf of the stockholders of AMCE (other than the Apollo Funds and the Durwood Voting Trust).

Q:

What is the recommendation of the Independent Committee?

A:

Based on a number of factors, including the fairness opinion received from Lazard Frères & Co. LLC, referred to as "Lazard" in this proxy statement, which acted as investment banker to the Independent Committee, and the other factors set forth in the section entitled "Special Factors—Recommendations of the Independent Committee and of our Board of Directors; Fairness of the Merger," the Independent Committee unanimously concluded that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are substantively and procedurally fair to and in the best interests of the unaffiliated AMCE stockholders and recommended that (1) our Board of Directors approve and adopt the merger agreement and the transactions contemplated thereby, including the merger, and (2) that the holders of AMCE common stock (other than Holdings, Marquee, the Apollo Funds, holders of the AMCE Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect

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holders of interests in Holdings, Marquee or AMCE, as the surviving corporation in the merger, and affiliates of any of the foregoing) adopt the merger agreement. See the section entitled "Special Factor—Recommendations of the Independent Committee and the Board of Directors; Fairness of the Merger" beginning on page 67.

Q:

What is the recommendation of our Board of Directors?

A:

Our Board of Directors unanimously (with the three directors affiliated with Apollo choosing to abstain) recommends that you vote "FOR" adoption of the merger agreement. In the opinion of our Board of Directors, based on a number of factors, including the opinion as to fairness received from Goldman, Sachs & Co., referred to as "Goldman Sachs" in this proxy statement, which acted as financial advisor to AMCE, and the other factors set forth in the section entitled "Special Factors—Recommendations of the Independent Committee and the Board of Directors; Fairness of the Merger," the merger agreement and the transactions contemplated by the merger agreement, including the merger, are substantively and procedurally fair to and in the best interests of AMCE and the unaffiliated AMCE stockholders. Peter C. Brown, our chairman and CEO, who it is anticipated will acquire and/or be granted an equity interest in Holdings and continue as an executive officer of AMCE following completion of the merger, participated in the Board of Directors' vote and recommendation. The Board members affiliated with Apollo chose to abstain and not to participate in the meeting at which the merger agreement was approved. See the section entitled "Special Factors—Recommendations of the Independent Committee and the Board of Directors; Fairness of the Merger" beginning on page 67.

Q:

What are the consequences of the merger to present members of management and our Board of Directors?

A:

Following the merger, it is expected that most of the members of our current management will continue as management of the surviving corporation. Like all our other stockholders, members of management and our Board of Directors will be entitled to receive $19.50 per share in cash for each of their shares of AMCE common stock. However, Mr. Brown and certain other members of our senior management (including Mr. Singleton) will acquire, or be given the opportunity to acquire, Holdings stock in connection with the merger. In addition, certain members of our Board of Directors affiliated with Apollo, Messrs. Black, Berg and Rowan, have interests in the merger different from the interests of our unaffiliated shareholders generally. See "Interests of Certain Persons in the Merger" beginning on page 107.

All options (whether or not vested) to acquire AMCE common stock held by members of management, all other employees and our Board of Directors will be cancelled at the effective time of the merger and holders of such options will be entitled to receive a cash payment equal to the amount by which $19.50 exceeds the exercise price of the option, multiplied by the number of shares of AMCE common stock underlying the options (less any required tax withholding). Each AMCE deferred stock unit (whether or not vested) held by members of management, all other employees and our Board of Directors will be cancelled at the effective time of the merger and holders of such deferred stock units will be entitled to receive a payment of $19.50 per deferred stock unit (less any required tax withholding).

For more information, see the section entitled "Interests of Certain Persons in the Merger" beginning on page 107.

Q:

Is the merger subject to the satisfaction of any conditions?

A:

Yes. Before completion of the transactions contemplated by the merger agreement, a number of closing conditions must be satisfied or waived. These conditions include, among others, obtaining stockholder approval; obtaining approvals under antitrust and competition laws of the U.S. and certain foreign jurisdictions; the absence of any law or governmental order prohibiting or enjoining

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the merger; the number of shares with respect to which AMCE stockholders have exercised rights of appraisal not exceeding an agreed upon maximum level and the receipt by Holdings and Marquee of financing proceeds sufficient to pay the merger consideration and related expenses. If these conditions are not satisfied or waived, the merger will not be completed even if our stockholders vote to adopt the merger agreement. See the section entitled "The Merger Agreement—Conditions to the Completion of the Merger" beginning on page 138.

Q:

When do you expect the merger to be completed?

A:

The parties to the merger agreement are working to complete the merger as soon as practicable. If the merger agreement is adopted and the other conditions to the merger are satisfied or waived, the merger is expected to be completed promptly after the special meeting. Because the merger is subject to certain conditions, the exact timing of the merger cannot be determined.

Q:

What are the U.S. federal income tax consequences of the merger to holders of AMCE stock?

A:

The merger will be treated as a taxable transaction to holders of AMCE stock for U.S. federal income tax purposes. A holder of AMCE stock will, subject to certain exceptions, generally recognize gain or loss, for U.S. federal income tax purposes, in an amount equal to the difference between the amount of cash received by such holder in the merger and such holder's tax basis in the AMCE stock surrendered in the merger. Holders should consult their tax advisors as to the tax consequences of the merger to them in light of their particular circumstances. See the section entitled "Material U.S. Federal Income Tax Consequences" beginning on page 124.

Q:

How do I vote my AMCE stock?

A:

Before you vote, you should read this proxy statement in its entirety, including its appendices, and carefully consider how the merger affects you. Then, mail your completed, dated and signed proxy card in the enclosed return envelope promptly so that your shares can be voted at the special meeting. You may also vote via the internet as indicated on the proxy card instructions. For more information on how to vote your shares, see the section entitled "The Special Meeting—Record Date and Voting Information" beginning on page 28.

Q:

What happens if I do not return a proxy card or vote my shares in person at the meeting?

A:

The failure to return your proxy card or vote your shares in person at the meeting will have the same effect as voting against adoption of the merger agreement.

Q:

May I vote in person?

A:

Yes. You may attend the special meeting and vote your shares in person whether or not you sign and return your proxy card. If your shares are held of record by a broker, bank or other nominee and you wish to vote at the special meeting, you must obtain a proxy from the record holder.

Q:

May I change my vote after I have mailed my signed proxy card?

A:

Yes. You may revoke and change your vote at any time before your proxy card is voted at the special meeting. You can do this in one of three ways:

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First, you can send a written notice stating that you would like to revoke your proxy;

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Second, you can complete and submit a later-dated proxy in writing, or submit a later-dated proxy via the internet; or

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Third, if you are a holder of record, you can attend the special meeting and vote in person, which will automatically cancel any proxy previously given, or you may revoke your proxy in person; your attendance alone, however, will not revoke any proxy that you have previously given.

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If you have instructed a broker to vote your shares, you must follow directions received from your broker to change those instructions.

Q:

If my shares are held in "street name" by my broker, will my broker vote my shares for me?

A:

Your broker will not be able to vote your shares without instructions from you. You should instruct your broker to vote your shares, following the procedures provided by your broker. Failure to instruct your broker to vote your shares will have the same effect as voting against adoption of the merger agreement.

Q:

What does it mean if I receive more than one set of materials?

A.

This means you own shares of AMCE stock that are registered under different names. For example, you may own some shares directly as a stockholder of record and other shares through a broker; or you may own shares through more than one broker. In these situations, you will receive multiple sets of proxy materials. You must vote, sign and return all of the proxy cards or follow the instructions for any alternative voting procedure on each of the proxy cards that you receive in order to vote all of the shares you own. Each proxy card you receive comes with its own prepaid return envelope; if you vote by mail, make sure you return each proxy card in the return envelope that accompanies that proxy card.

Q:

If the merger is completed, how will I receive the cash for my shares?

A.

If the merger is completed, you will be contacted by UMB Bank, n.a., which will serve as the exchange agent and will provide instructions that will explain how to surrender stock certificates. You will receive cash for your shares from the exchange agent after you comply with these instructions. If your shares of common stock are held in "street name" by your broker, you will receive instructions from your broker as to how to effect the surrender of your "street name" shares and receive cash for those shares.

Q:

Should I send in my stock certificates now?

A:

No. After the merger is completed, you will receive written instructions for exchanging (1) each issued and outstanding share of AMCE common stock and AMCE Class B stock into $19.50 in cash and (2) each issued and outstanding share of AMCE preferred stock into $2,727.27 in cash. See the section entitled "The Merger—Payment of Merger Consideration and Surrender of Stock Certificates" beginning on page 114.

Q:

What rights do I have to seek appraisal of my shares?

A:

Holders of shares of AMCE stock are entitled to appraisal rights under Delaware law if they follow the requirements specified in Section 262 of the Delaware General Corporation Law, which we refer to as the "DGCL" in this proxy statement. A copy of Section 262 of the DGCL is attached as Appendix E to this proxy statement.

Q:

Who can help answer my questions?

A:

If you would like additional copies, without charge, of this proxy statement or if you have questions about the merger agreement or the merger, including the procedures for voting your shares, you should contact:

Kevin M. Connor, General Counsel & Secretary, AMC Entertainment Inc., at (816) 221-4000.

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Participants

        Set forth below is information regarding the individuals and entities that may be deemed "participants" in the solicitation of proxies from AMCE stockholders in connection with the special meeting pursuant to the rules promulgated under the Securities Exchange Act of 1934, as amended, which we refer to in this proxy statement as the "Exchange Act."

AMC Entertainment Inc.
920 Main Street
Kansas City, MO 64105
Telephone: (816) 221-4000

        AMCE is a leader in the theatrical exhibition industry. As of September 30, 2004, through its circuit of AMC Theatres, AMCE operates 230 theatres with 3,548 screens in the United States, Canada, France, Hong Kong, Japan, Portugal, Spain and the United Kingdom. Shares of AMCE common stock trade on the American Stock Exchange under the symbol "AEN".

        In addition to AMCE, the executive officers and directors of AMCE may also be deemed to be participants in the solicitation of proxies from the AMCE stockholders in connection with the special meeting.

        AMCE and, to its knowledge, each of its directors and executive officers, has not during the past five years been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors), nor has it been a party to any judicial or administrative proceeding (except for matters that were dismissed without sanction or settlement) that resulted in a judgment, decree or final order enjoining AMCE or any such director or executive officer from future violations of, or prohibiting the activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws.

        Additional information about AMCE's business and its directors and executive officers is set forth in AMCE's Annual Report on Form 10-K, and Amendment No. 1 thereto on Form 10-K/A, in each case for the fiscal year ended April 1, 2004, and its Quarterly Report on Form 10-Q for the quarters ended July 1, 2004 and September 30, 2004, each of which are incorporated in this proxy statement by reference. See "Where Stockholders Can Find More Information" on page 156.

Apollo Capital Management IV, Inc.
Apollo Advisors IV, L.P.
Apollo Investment Fund IV, L.P.
Apollo Overseas Partners IV, L.P.
AIF IV Management, Inc.
Apollo Management IV, L.P.
Apollo Capital Management V, Inc.
Apollo Advisors V, L.P.
Apollo Investment Fund V, L.P.
Apollo Overseas Partners V, L.P.
Apollo Netherlands Partners V(A), L.P.
Apollo Netherlands Partners V(B), L.P.
Apollo German Partners V GMBH & CO KG
AP Entertainment, LLC
AIF V Management, Inc.

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Apollo Management V, L.P.

9 West 57th Street
43rd Floor
New York, New York 10019
Attention: Michael D. Weiner
Telephone: (212) 515-3200

        Apollo is engaged in the business of investing in securities and is continuously engaged in the process of identifying, receiving and reviewing potential investment opportunities. Apollo Capital Management IV, Inc. is a Delaware corporation and is the general partner of Apollo Advisors IV, L.P., a Delaware limited partnership which is the general partner of each of Apollo Investment Fund IV, L.P. and Apollo Overseas Partners IV, L.P. AIF IV Management, Inc. is the general partner of Apollo Management IV, L.P. Apollo Capital Management V, Inc. is a Delaware corporation and is the general partner of Apollo Advisors V, L.P., a Delaware limited partnership which is the general partner of each of the Apollo Investors. Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P., Apollo Netherlands Partners V(A), L.P., Apollo Netherlands Partners V(B), L.P., and Apollo German Partners V GMBH & CO KG are the Apollo Investors. Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P. and AP Entertainment, LLC are the Apollo Funds. AIF V Management, Inc. is the general partner of Apollo Management V, L.P. Leon D. Black and John J. Hannan are the directors and principal executive officers of each of Apollo Management IV, L.P., AIF IV Management, Inc., Apollo Management V, L.P., AIF V Management, Inc.

        The business address for each of Apollo Management IV L.P., Apollo Management V, L.P., Leon D. Black and John J. Hannan is 9 West 57^th Street, 43^rd Floor, New York, New York 10019, and their phone number is (212) 515-3200.

J.P. Morgan Partners (BHCA), L.P.
J.P. Morgan Partners Global Investors, L.P.
J.P. Morgan Partners Global Investors (Cayman), L.P.
J.P. Morgan Partners Global Investors A, L.P.
J.P. Morgan Partners Global Investors (Cayman) II, L.P.
J.P. Morgan Partners Global Investors (Cayman) V, L.P.
J.P. Morgan Partners Global Investors (Selldown), L.P.
AMCE (Fred), L.P.
AMCE (Ginger), L.P.
AMCE (Darth), L.P.
AMCE (Luke), L.P.
AMCE (Rhett), L.P.
AMCE (Scarlett), L.P.

1221 Avenue of the Americas
39^th Floor
New York, New York 10020
Attention:  Michael R. Hannon
                   Stephen P. Murray
Telephone: (212) 899-3400

        Information with respect to the JPMP Investors, which are the thirteen entities listed above, as well as each of their controlling persons, directors and executive officers is set forth below.

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        The JPMP Investors are engaged in the venture capital, private equity and leveraged buyout business and are continuously engaged in the process of identifying, reviewing and receiving potential investment opportunities. The general partner of J.P. Morgan Partners (BHCA), L.P. is JPMP Master Fund Manager, L.P., which is also engaged in the venture capital, private equity and leveraged buyout business as the general partner of various investment vehicles. The general partner of each of J.P. Morgan Partners Global Investors, L.P., J.P. Morgan Partners Global Investors (Cayman), L.P., J.P. Morgan Partners Global Investors A, L.P., J.P. Morgan Partners Global Investors (Cayman) II, L.P., J.P. Morgan Partners Global Investors (Cayman) V, L.P. and J.P. Morgan Partners Global Investors (Selldown), L.P. is JPMP Global Investors, L.P., which is engaged in the venture capital, private equity and leveraged buyout business as general partner of each of these funds. AMCE (Fred), L.P., AMCE (Ginger), L.P., AMCE (Darth), L.P., AMCE (Luke), L.P., AMCE (Rhett), L.P. and AMCE (Scarlett), L.P., the general partner of each of which is JPMP Global Investors, L.P., are newly-formed entities which have not engaged in any business except in connection with the merger. The general partner of each of JPMP Master Fund Manager, L.P. and JPMP Global Investors, L.P. is JPMP Capital Corp., which is also engaged in the venture capital, private equity and leveraged buyout business as the general partner of various investment vehicles. JPMP Capital Corp. is a wholly owned subsidiary of JPMorgan Chase & Co., which is engaged (through subsidiaries) in the commercial and investment banking business with its principal office located at 270 Park Avenue, New York, NY 10017.

        Set forth below are the names, principal occupations and employments of each executive officer and director of JPMP Capital Corp. Except as otherwise indicated, the business address of each such individual is c/o JPMP Capital Corp., 1221 Avenue of the Americas, 39^th Floor, New York, New York, 10020.

*

Principal occupation is officer of JPMorgan Chase & Co. Business address is c/o JPMorgan Chase & Co., 270 Park Avenue, New York, New York 10017.

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Marquee Holdings Inc.
Marquee Inc.

c/o J.P. Morgan Partners (BHCA), L.P.
1221 Avenue of the Americas
39^th Floor
New York, New York 10020
Attention:  Michael R. Hannon
                   Stephen P. Murray
Telephone: (212) 899-3400

        Marquee, a newly formed Delaware corporation, was formed by Holdings solely for the purpose of completing the merger. Marquee is wholly owned by Holdings and has not engaged in any business except in anticipation of the merger.

        Holdings, a newly formed Delaware corporation, was formed by J.P. Morgan Partners (BHCA), L.P. and Apollo Investment Fund V, L.P. solely for the purpose of acquiring us. Holdings has not engaged in any business except in connection with the merger.

        Set forth below are the names of each executive officer and director of Marquee and Holdings.

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Management Investors

        Peter C. Brown and Philip M. Singleton will be given the opportunity to maintain an indirect interest in AMCE through the purchase of, or grant of equity interests in, Holdings. Throughout this proxy statement, we refer to Messrs. Brown and Singleton collectively as the "Management Investors."

        Peter C. Brown is Chairman of the Board, President and Chief Executive Officer of AMCE. Mr. Brown is also Chairman of the Board, Chief Executive Officer and a Director of American Multi-Cinema, Inc., a subsidiary of AMCE.

        Philip M. Singleton is a President, Chief Operating Officer and a Director of American Multi-Cinema, Inc. Mr. Singleton also serves as an Executive Vice President of AMCE.

        The business address of each of the Management Investors is 920 Main Street, Kansas City, Missouri 64105 and his business telephone number is care of AMCE at (816) 221-4000. Both such individuals are citizens of the United States.

        Neither of the Management Investors have, during the past five years, been convicted in a criminal proceeding, nor have any of them been a party to any judicial or administrative proceeding that resulted in a judgment, decree or final order enjoining him from future violations of, or prohibiting the activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws.

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Cautionary Statement Concerning Forward-Looking Information

        This proxy statement includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this proxy statement regarding the prospects of our industry and our prospects, plans, financial position and business strategy may constitute forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "estimate," "anticipate," "plan," "foresee," "believe" or "continue" or the negative of these terms or variations of them or similar terminology. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. In addition to other factors discussed elsewhere in this proxy statement, important factors that could cause actual results to differ materially from our expectations include, among others: (i) our ability to enter into various financing programs; (ii) the cost and availability of films and the performance of films licensed by us; (iii) competition; (iv) construction delays; (v) the ability to open or close theatres and screens as currently planned; (vi) the ability to sub-lease vacant retail space; (vii) domestic and international political, social and economic conditions; (viii) demographic changes; (ix) increases in the demand for real estate; (x) changes in real estate, zoning and tax laws; (xi) unforeseen changes in operating requirements; (xii) our ability to identify suitable acquisition candidates and successfully integrate acquisitions into our operations; (xiii) results of significant litigation and (xiv) our ability to obtain regulatory approvals and to consummate the proposed merger. Readers are urged to consider these factors carefully in evaluating forward-looking statements.

        The safe harbor from liability for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, do not apply to forward-looking statements made in connection with a going-private transaction, including statements made in a proxy statement or documents incorporated by reference therein.

        All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. The forward-looking statements included herein are made only as of the date of this proxy statement, and we do not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Notwithstanding the foregoing, in the event of any material change in any of the information previously disclosed, we will, where relevant and if required by applicable law, (i) update such information through a supplement to this proxy statement and (ii) amend the Transaction Statement on Schedule 13E-3 filed in connection with the merger, in each case, to the extent necessary.

        All information contained in this proxy statement concerning Apollo, the Apollo Investors, the JPMP Investors, J.P. Morgan Partners, Holdings, Marquee, the Management Investors and their respective affiliates and designees has been supplied by the respective parties and has not been independently verified by AMCE.

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The Special Meeting

General

        The enclosed proxy is solicited on behalf of our Board of Directors for use at a special meeting of our stockholders to be held on December 23, 2004, at 9:00 a.m. local time, or at any adjournments or postponements of the special meeting, for the purposes set forth in this proxy statement and in the accompanying notice of special meeting. The special meeting will be held at AMC Town Center 20 Theatres, 11701 Nall Avenue, Leawood, Kansas 66211. AMCE intends to mail this proxy statement and the accompanying proxy card on or about November 26, 2004 to all stockholders entitled to vote at the special meeting.

        At the special meeting, our stockholders are being asked to consider and vote upon a proposal to adopt the merger agreement.

        AMCE does not expect a vote to be taken on any other matters at the special meeting. If any other matters are properly presented at the special meeting for consideration, however, the holders of the proxies, if properly authorized, will have discretion to vote on these matters in accordance with their best judgment.

Record Date and Voting Information

        Only holders of AMCE common stock and Class B stock outstanding on November 22, 2004, the record date for the special meeting, and holders not affiliated with Apollo of preferred stock outstanding on the record date, are entitled to notice of and to vote at the special meeting. At the close of business on the record date, 34,019,497 shares of AMCE common stock, 3,051,597 shares of AMCE class B stock, and 305,548 shares of AMCE preferred stock were outstanding and 20,046 were held by entities not affiliated with Apollo and therefore are entitled to vote. A list of our stockholders will be available for review at AMCE's executive offices during regular business hours for a period of ten days before the special meeting beginning on December 9, 2004 and at the special meeting.

        Each holder of record will have one vote for each share of AMCE common stock owned at the close of business on the record date and ten votes for each share of AMCE class B stock owned at the close of business on the record date. For each share of AMCE preferred stock outstanding on the record date and held of record by an AMCE stockholder not affiliated with Apollo, such stockholder shall have 139.860 votes, which is equal to the number of votes to which such stockholder would be entitled if such share of AMCE preferred stock were to be converted into shares of AMCE common stock in accordance with its terms and immediately prior to the record date. The presence, in person or by proxy, of the holders of a majority of the outstanding shares of AMCE common stock, Class B stock and preferred stock entitled to vote at the special meeting is necessary to constitute a quorum for the transaction of business at the special meeting.

        Properly executed and dated proxies which are received by AMCE prior to the special meeting will be voted in accordance with the instructions thereon. If a proxy is received with no instructions given with respect to the matters to be acted upon, the shares represented by the proxy will be voted in favor of the merger agreement. A proxy may be revoked at any time by written notice to such effect received by the Secretary of AMCE before the proxy is voted at the special meeting, by delivery to AMCE of a subsequently dated proxy or by a vote cast in person at the special meeting by written ballot.

        Adoption of the merger agreement requires the affirmative vote of a majority of the votes entitled to be cast at the meeting, that is, the majority of votes entitled to be cast by the following stockholders (in each case as of the record date), voting together as a single class: (1) holders of the outstanding shares of AMCE common stock, (2) holders of the outstanding shares of AMCE Class B stock and (3) holders of outstanding shares of AMCE preferred stock who are not affiliated with Apollo. The merger is not conditioned upon approval by a separate vote of a majority of the unaffiliated security holders of AMCE (as such term is defined in Rule 13e-3 under the Exchange Act).

        The Durwood Voting Trust which, as of the record date, owned 3,051,597 shares of AMCE Class B stock, representing approximately 45.5% of the outstanding votes entitled to be cast, has entered into a voting agreement pursuant to which, on the terms and conditions contained in the voting agreement, it

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has agreed, among other things, to vote all of its shares in favor of adoption of the merger agreement. See "The Voting Agreements—Durwood Trust Voting Agreement" on page 144. In addition, the Apollo Funds, which, as of the record date, owned 166,258 shares of AMCE common stock, representing less than 0.2% of the outstanding votes entitled to be cast, and Apollo Management have entered into a consent and voting agreement pursuant to which, on the terms and subject to the conditions contained in the voting agreement, it has agreed, among other things, to vote all of its shares in favor of adoption of the merger agreement. See "The Voting Agreements—Apollo Consent and Voting Agreement" on page 143. Assuming compliance by the Durwood Voting Trust and the Apollo Funds with the terms of their respective voting agreements, an additional 2,849,143 votes, representing approximately 4.3% of the total votes entitled to be cast at the meeting, must be voted in favor of adoption of the merger agreement by the other holders of AMCE common stock and AMCE preferred stock in order to complete the merger. In order to obtain the required additional votes (1) assuming all shares of AMCE preferred stock entitled to be voted on the merger are voted in favor of the merger, an additional 321,870 shares of AMCE common stock must be voted in favor of the merger; and (2) assuming no such shares of AMCE preferred stock are voted in favor of the merger, an additional 2,849,143 shares of AMCE common stock must be voted in favor of the merger. Of this amount, we note that those directors and executive officers (including the Management Investors) who owned AMCE common stock, as of the record date, representing in the aggregate approximately 1% of the outstanding votes entitled to be cast, have indicated that, although they are not obligated to do so, they intend to vote their shares of AMCE common stock in favor of adoption of the merger agreement.

        After carefully reading and considering the information contained in this proxy statement, each holder of AMCE stock should complete, date and sign its proxy card and mail the proxy card in the enclosed return envelope as soon as possible so that those shares of AMCE stock can be voted at the special meeting, even if holders plan to attend the special meeting in person. You can also submit your proxy over the internet by visiting the Web site designated on your proxy card. You must have your control number and proxy card available if you intend to vote using the internet; please follow the on-screen instructions and the instructions on your proxy card.

        Proxies received at any time before the special meeting and not revoked or superseded before being voted will be voted at the special meeting. If the proxy indicates a specification, it will be voted in accordance with the specification. If no specification is indicated, the proxy will be voted "FOR" approval of the merger agreement and in the discretion of the persons named in the proxy with respect to any other business that may properly come before the meeting or any adjournment of the meeting. You may also vote in person by ballot at the special meeting.

        Please do not send in stock certificates at this time. If the merger is completed, you will be sent instructions regarding the procedures for exchanging existing AMCE stock certificates for the appropriate per share cash payment.

Proxies; Revocation

        Any person giving a proxy pursuant to this solicitation has the power to revoke and change it at any time before it is voted. It may be revoked and changed by filing a written notice of revocation with the Secretary of AMCE at AMCE's executive offices located at 920 Main Street, Kansas City, Missouri, 64105, by submitting in writing, or over the Internet a proxy bearing a later date, or by attending the special meeting and voting in person. Attendance at the special meeting will not, by itself, revoke a proxy. If you have instructed a broker to vote your shares, you may revoke and change your proxy by following the directions received from your broker to change those instructions.

Expenses of Proxy Solicitation

        AMCE will bear the entire cost of solicitation of proxies, including preparation, assembly, printing and mailing of this proxy statement, the proxy and any additional information furnished to stockholders.

        Copies of solicitation materials will also be furnished to banks, brokerage houses, fiduciaries and custodians holding in their names shares of AMCE common stock, Class B stock or preferred stock

29

beneficially owned by others to forward to these beneficial owners. AMCE may reimburse persons representing beneficial owners of AMCE common stock, Class B stock or preferred stock for their costs of forwarding solicitation materials to the beneficial owners. Original solicitation of proxies by mail may be supplemented by telephone or personal solicitation by directors, officers or other regular employees of AMCE. No additional compensation will be paid to directors, officers or other regular employees for their services.

Adjournments

        AMCE's restated bylaws provide that if an annual or special meeting of stockholders is adjourned, notice need not be given of any adjourned meeting if the time, date and place are announced at the meeting at which the adjournment occurs, so long as the adjourned meeting is no more than 30 days after the initial meeting date and no new record date is fixed for the adjourned meeting.

Other Matters

        AMCE's Board of Directors is not aware of any business to be brought before the special meeting other than that described in this proxy statement.

Special Factors

Certain Effects of the Merger

Conversion of Outstanding AMCE Stock, Stock Options and Deferred Stock Units

        Upon completion of the merger, each holder of shares of AMCE common stock or AMCE Class B stock will be entitled to receive $19.50 in cash for each such share held and each holder of shares of AMCE preferred stock will be entitled to receive $2,727.27 in cash for each such share held. Any shares owned by Holdings or Marquee will be cancelled. However, the parties to the merger agreement have agreed that until ten (10) business days prior to the special meeting, the Apollo Funds may, provided that certain specific conditions are satisfied, request that the merger agreement and the other documents delivered in connection therewith be amended, and the parties thereto will agree to such amendments, to provide for the Apollo Funds and the Apollo Investors to contribute all or a portion of the AMCE stock owned by them immediately prior to the merger to Holdings in exchange for equity securities of Holdings in lieu of the right to receive cash for such shares in the merger. Such amendments would provide that any shares owned by Holdings would not be affected by the merger and would remain outstanding following the merger. Apollo has advised the Company that the Apollo Funds and the Apollo Investors do not intend to request that the merger agreement be so amended after the date of the mailing of this proxy statement.

        Upon completion of the merger, each option to purchase shares of AMCE common stock which is outstanding prior to the effective time of the merger, whether or not then exercisable, will be cancelled, and each option holder will be entitled to receive a cash payment equal to the amount by which $19.50 exceeds the exercise price of the option, multiplied by the number of shares of AMCE common stock underlying the option, less any income tax or employment tax withholding required under the Code. Each AMCE deferred stock unit which is outstanding immediately prior to the effective time of the merger, whether or not then vested, will be cancelled, and each deferred stock unit holder will be entitled to receive a cash payment equal to the amount by which $19.50 exceeds any income tax or employment tax withholding required under the Code. See "The Merger Agreement—Treatment of AMCE Stock Options and Equity Awards" beginning on page 131.

Effect on Ownership Structure of AMCE

        If the merger is completed, 100% of the equity in AMCE will be owned by Holdings. Except for the Apollo Investors, the Management Investors and certain other members of AMCE senior management who may purchase or be granted equity interests in Holdings prior to or upon consummation of the merger, through their respective interests in Holdings stock, no current AMCE stockholder will have any ownership interest in, or will be a stockholder of, AMCE. As a result, our stockholders (other than the Apollo Investors and the Management Investors, indirectly through their

30

ownership of Holdings stock) will no longer benefit from any increases in AMCE's value, nor will they bear the risk of any decreases in AMCE's value. Following the merger, Holdings will directly benefit from any increases in the value of AMCE and also will bear the risk of any decreases in the value of AMCE.

        The JPMP Investors and the Apollo Investors initially agreed to contribute approximately $393.5 million and approximately $391.9 million, respectively, to Holdings in exchange for ownership percentages of Holdings common stock equal to 50.1% and 49.9%, respectively. These ownership percentages will be reduced to the extent that Holdings common stock is purchased by, or granted to, the Management Investors upon completion of the merger and to the extent certain other members of AMCE senior management purchase or are granted equity interests in Holdings. In addition, the JPMP Investors and the Apollo Investors have agreed to syndicate a portion of their equity investment in Holdings to a number of third party co-investors immediately prior to the completion of the merger, reflecting co-investments of not more than $50 million by any one co-investor and not more than $232 million in the aggregate. See footnote (f) to the table entitled "Effects of Going Private Transaction on Interests in AMCE's Net Book Value and Net Earnings" on page 32 for a list of the third party co-investors. The JPMP Investors and the Apollo Investors are considering causing AMCE, as the surviving corporation in the merger, to pay an annual management fee of up to $2 million in the aggregate to the JPMP Investors and the Apollo Investors, but no final decision has been made in this regard; the payment of any such fee would not affect the merger consideration received by the AMCE stockholders.

Effects of the Merger on the Apollo Funds and the Apollo Investors

        Pursuant to the terms of the certificate of designations for the AMCE preferred stock, the Apollo Funds, as holders of AMCE preferred stock, will receive a one-time distribution of shares of AMCE preferred stock upon the occurrence prior to April 19, 2006 of a "change of control," as such term is defined in the certificate of designations. See "Interests of Certain Persons in the Merger—Interests of Apollo in the Merger—Change of Control Distribution Payable in Connection with the Merger" on page 112. The Apollo Funds will be permitted to, and will, convert their shares of AMCE preferred stock, including the shares of AMCE preferred stock received pursuant to the Changes of Control Distribution, into AMCE common stock immediately prior to the merger. See "Interests of Certain Persons in the Merger—Interests of Apollo in the Merger" on page 111 and "Special Factors—Certain Effects of the Merger—Conversion of Outstanding AMCE Stock, Stock Options and Deferred Stock Units" on page 30 for a description of the effects of the Merger on the AMCE stock held by the Apollo Funds. The Apollo Investors will have the interests in Holdings following completion of the merger described in "Interests of Certain Persons in the Merger—Interests of Apollo in the Merger—The Apollo Investors' Interests in Holdings Following Completion of the Merger: Ownership and Governance" beginning on page 111. The Apollo Funds expect to be taxed on their sale of AMCE stock for cash in the transaction.

Effects of the Merger on the Management Investors

        The Management Investors have relationships with AMCE or interests in the merger that are different from your interests as a shareholder and that may present actual or potential conflicts of interest. These interests are discussed in detail in the sections entitled "Interests of Certain Persons in the Merger—Interests of AMCE Executive Officers" beginning on page 107, "Interests of Certain Persons in the Merger—Interests of AMCE Directors" beginning on page 110, "The Merger Agreement—Treatment of AMCE Stock in the Merger," beginning on page 130, "The Merger Agreement—Treatment of AMCE Stock Options and Equity Awards" beginning on page 131, and "Special Factors—Certain Effects on the Merger—Effects on Interests in AMCE's Net Book Value and Net Earnings" beginning on page 31. The Management Investors expect to be taxed on their sale of AMCE stock for cash in the transaction.

Effects on Interests in AMCE's Net Book Value and Net Earnings

        Prior to the merger, none of Holdings, Marquee or the JPMP Investors has an interest in AMCE's net book value or net earnings. The Apollo Funds, by virtue of their ownership of shares of AMCE

31

common stock and AMCE preferred stock, collectively have an interest of approximately 50.59% of AMCE's net book value and net earnings. The Management Investors, by virtue of their ownership of shares of AMCE common stock, collectively have an interest of approximately 0.90% of AMCE's net book value and net earnings. The unaffiliated AMCE stockholders collectively have an interest of approximately 48.51% of AMCE's net book value and net earnings. If the merger is consummated, 100% of the equity of AMCE will be owned by Holdings, and the unaffiliated AMCE stockholders will cease to have any interest in AMCE's net book value and net earnings. The Apollo Investors, the JPMP Investors and the Management Investors will have an indirect interest in AMCE's net book value and net earnings by virtue of their respective ownership interests in Holdings.

        The table below sets forth the interest in AMCE's net book value and net earnings of Holdings, Marquee, Apollo, the JPMP Investors and the Management Investors before and after the merger, based on the historical net book value of AMCE as of September 30, 2004 and the historical net earnings of AMCE for the six months ended September 30, 2004.

Effects of Going Private Transaction on Interests in AMCE's
Net Book Value and Net Earnings

(a)

Assumes conversion of all shares of AMCE Class B stock into AMCE common stock and the conversion of all shares of AMCE preferred stock into AMCE common stock, in each case in accordance with the terms of such stock.

(b)

Total Shares outstanding prior to merger does not give effect to change of control distribution payable in shares of AMCE preferred stock.

(c)

Ownership after the merger assumes completion of the planned syndication of equity interests in Holdings to third party co-investors, as described under the caption "Special Factors—Certain Effects of the Merger—Effect on Ownership Structure of AMCE" beginning on page 30. Ownership after the merger also assumes anticipated purchases of equity interests in Holdings by the Management Investors, as described under the caption "Interests of Certain Persons in the Merger—Interests of AMCE Executive Officers—Arrangement Following Consummation of the Merger—Management Reinvestment" on page 109, but does not take into account any purchase of equity interests in Holdings by other members of AMCE senior management that may take place prior to or upon consummation of the merger. Ownership after the merger also does not take into account any equity-based awards which may be granted pursuant to the new option program described under the caption "Interests of Certain Persons in the Merger—Interests of AMCE Executive Officers—Arrangement Following Consummation of the Merger—New Option Program" on page 109, which such awards will vest over a five year period from the date of grant.

(d)

The Apollo Investors will own approximately 35.0% of the outstanding shares of Holdings after the merger. Holdings will own 100% of the capital stock of AMCE following the merger.

(e)

The JPMP Investors will own approximately 35.0% of the outstanding shares of Holdings after the merger. Holdings will own 100% of the capital stock of AMCE following the merger.

(f)

The third party co-investors in the aggregate will own approximately 29.5% of the outstanding shares of Holdings after the merger. The third party co-investors (and the aggregate equity investments to be made in Holdings immediately prior to the Merger) are: Weston Presidio Capital IV, L.P. and WPC Entrepreneur Fund II, L.P. ($50.0 million); Co-Investment Partners, L.P. ($50.0 million); Caisse de Depot Et Placement du Quebec ($40.0 million); AlpInvest Partners CS Investments 2003 C.V., AlpInvest Partners Later Stage Co-Investments Custodian II B.V. and AlpInvest Partners Later Stage Co-Investments Custodian IIA B.V. ($35.0 million); SSB Capital Partners (Master Fund) I, L.P. ($25.0 million); CSFB Strategic Partners Holdings II, L.P., CSFB Strategic Partners Parallel Holdings II, L.P., CSFB Credit Opportunities Fund (Employee), L.P. and CSFB Credit Opportunities Fund (Helios), L.P. ($20.0 million); Credit Suisse Anlagestiftung, Pearl Holding Limited, Vega Invest (Guernsey) Limited and Partners Group Private Equity Performance Holding Limited

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($10.0 million); and Screen Investors 2004, LLC ($1.95 million). Holdings will own 100% of the capital stock of AMCE following the merger.

(g)

The Management Investors in the aggregate will own approximately 0.5% of the outstanding shares of Holdings after the merger. Holdings will own 100% of the capital stock of AMCE following the merger.

Effects on Listing, Registration and Status of AMCE Common Stock

        Following the merger, shares of AMCE common stock will be no longer traded on the American Stock Exchange.

        AMCE common stock is currently registered as a class of equity security under the Exchange Act. Registration of the common stock under the Exchange Act may be terminated upon application by AMCE to the SEC if the common stock is not listed on a national securities exchange or quoted on Nasdaq and there are fewer than 300 record holders of the outstanding shares. Termination of registration of the common stock under the Exchange Act would substantially reduce the information required to be furnished by AMCE to its stockholders and the SEC, and would make certain provisions of the Exchange Act, such as the short-swing trading provisions of Section 16(b) of the Exchange Act and the requirement of furnishing a proxy statement in connection with stockholders meeting pursuant to Section 14(a) of the Exchange Act, no longer applicable to AMCE. It is anticipated, however, that AMCE, as an issuer of registered debt securities, would be required to file periodic reports with the SEC under the Exchange Act for so long as its debt securities remain registered.

        AMCE's common stock currently constitutes "margin securities" under the regulations of the Board of Governors of the Federal Reserve System, which has the effect, among other things, of allowing brokers to extend credit on collateral of the common stock. As a result of the merger, AMCE common stock will no longer constitute "margin securities" for purposes of the margin regulations of such Board of Governors and, therefore, will no longer constitute eligible collateral for credit extended by brokers.

Operations of AMCE Following the Merger

        Except as described in this proxy statement, AMCE has no, and Holdings, Marquee, the JPMP Investors, the Apollo Investors and the Management Investors have informed us that they have no, current plans or proposals or negotiations which relate to or would result in an extraordinary corporate transaction, such as a merger, reorganization, or liquidation; a purchase, sale or transfer of a material amount of assets; a material change in AMCE's present dividend rate or policy, or indebtedness or capitalization; a change in AMCE's present board of directors or management; a material change in AMCE's corporate structure or business; any class of AMCE's equity securities being delisted from any national securities exchange or becoming eligible for termination of registration under the Exchange Act; the suspension of AMCE's reporting obligations under Section 15(d) of the Exchange Act; the acquisition by any person of additional securities of AMCE or the disposition of any securities by AMCE; or any change in AMCE's charter or bylaws. The JPMP Investors, the Apollo Investors, the Management Investors and Holdings may initiate from time to time reviews of our assets, corporate structure, capitalization, operations, properties, management and personnel to determine what changes, if any, would be desirable following the merger. They expressly reserve the right to make any changes that they deem necessary or appropriate in the light of their review or in the light of future developments. AMCE and its Board of Directors are continuously engaged in the process of evaluating strategic alternatives and investment opportunities for AMCE. In addition, the JPMP Investors and the Apollo Investors are continuously engaged in the process of identifying, receiving and reviewing potential investment opportunities in companies. In that regard, AMCE, the JPMP Investors, the Apollo Investors, the Management Investors and Holdings expect in the future to explore and discuss with third parties potential investment, acquisition and other opportunities involving companies in the same and related lines of business as AMCE.

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Background of the Merger

        In 1995, AMCE introduced megaplex theatres in the United States. Competitors in the theatrical exhibition industry quickly followed suit, which led to a proliferation of screens in the industry during the late 1990's. While attendance and box office revenues generally increased during that period, the increased revenues of many theatrical exhibition companies were insufficient to offset the costs of operating additional theatres and many operators were unable to rationalize excess screen capacity, leading to a number of major theatrical exhibition companies filing for bankruptcy protection during that period and in the early part of this decade.

        Although AMCE did not file for bankruptcy protection during that period, its management and advisors were concerned that AMCE would be at a competitive disadvantage to other industry participants who had emerged from bankruptcy with reduced debt loads, favorably re-negotiated leases or having been released from unprofitable leases. Further, in the spring of 2001, there was increasing concern over potential Writers Guild of America and Screen Actors Guild strikes, which, had they occurred, could have hurt both earnings and market perceptions of the industry. As a result, AMCE during that time evaluated a number of alternatives intended to strengthen its balance sheet in order to compete effectively. In April 2001, AMCE's Board of Directors approved an investment in AMCE by the Apollo Funds. The additional capital from the transaction with Apollo provided AMCE with greater flexibility to pursue opportunities in a restructuring and consolidating industry environment.

        Following the investment by the Apollo Funds, AMCE continued its normal-course, ongoing evaluation of its business, plans and strategic alternatives. As part of this process, AMCE's management, in consultation with its Board of Directors, periodically evaluated various alternatives for expanding AMCE's business and creating value for AMCE's stockholders, including through acquisitions of, or strategic combinations with, other theatrical exhibition companies. As part of this value-enhancement effort, AMCE completed three acquisitions of theatre circuits between March 2002 and December 2003, including the acquisition of GC Companies, Inc. in March 2002 for a purchase price of approximately $169 million.

        During this period, AMCE also evaluated a number of other transactions, including a strategic combination with Loews Cineplex Entertainment Corp., which we refer to as Loews Cineplex, which emerged from bankruptcy protection in March 2002. AMCE's management and its advisors had continually identified a combination with Loews Cineplex to be an attractive strategic transaction for AMCE and an opportunity to create shareholder value through acquisition-fueled growth. On a number of occasions between April 2002 and January 2004, AMCE pursued preliminary discussions with Loews Cineplex regarding a combination with, or acquisition by, AMCE. Negotiations between the parties were terminated on a number of different occasions as the parties were unable to agree on the terms of any such transaction. No definitive agreements with respect to a transaction were ever reached between the parties.

        In January 2004, Cinemark, Inc., another major domestic theatrical exhibition company, announced that it had engaged financial advisors to develop strategic alternatives for the company in order to enhance value for its shareholders. Shortly thereafter, Cinemark's advisors conducted a managed sale process which ultimately resulted in the announcement of a definitive agreement to sell a majority of the capital stock of Cinemark to affiliates of Madison Dearborn Partners, a private equity firm, in March 2004 in a transaction valued at approximately $1.5 billion. During the Cinemark sale process, AMCE's management and Board of Directors considered pursuing an acquisition of, or combination with, Cinemark, but ultimately concluded that a combination with Cinemark was not an attractive strategic alternative for AMCE and its shareholders. This conclusion was based on a number of factors, including (i) the price which the Board believed Cinemark would likely command in a sale process, which would require AMCE to become more highly levered; (ii) the potential risks of non-consummation posed by a combination with Cinemark; and (iii) the Board's belief that integration of the two companies could be difficult.

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        AMCE also continued to explore other opportunities to create value for its shareholders, including possible recapitalization transactions. In February 2004, AMCE's Board of Directors formed a special committee of independent directors, consisting of Charles Sosland and Paul Vardeman, to consider certain potential transactions relating to AMCE's outstanding classes of capital stock, including certain transactions designed to simplify AMCE's capital structure through the conversion of its outstanding shares of Series A convertible preferred stock into common stock and/or its outstanding shares of Class B stock into common stock. It was the Board's belief that creating a simplified capital structure for AMCE—that is, one with a single class of common stock—would more fully align the interests of all of AMCE's stockholders and might make an investment in AMCE stock more attractive, thereby benefiting all of AMCE's stockholders.

        The committee considered transactions in which AMCE would make a cash payment to the holders of AMCE preferred stock and/or Class B stock in order to induce the holders of such stock to convert their shares into common stock. In connection with the possible recapitalization transaction, Lazard provided the committee with factual information with respect to acquisitions and recapitalization transactions involving dual class stock structures, including information about the voting and economic interest of each class of stock and the premium paid, if any, for the high vote stock.

        With respect to acquisition transactions, Lazard included information for transactions occurring within the last ten years and with a transaction value in excess of $250 million. Lazard calculated the mean and median premium received by the holders of shares of high vote stock in comparison to the holders of shares of low vote stock. The results of these calculations are as follows.

        With respect to recapitalization transactions, Lazard included information for transactions occurring since 1998 and with a transaction value in excess of $100 million. Lazard calculated the mean and median for each of the premium received by the holders of shares of high vote stock in comparison to the holders of shares of low vote stock, the premium received by the holders of shares of high vote stock divided by the market value of the low vote stock, the percentage reduction in the aggregate economic interest held by the holders of low vote common stock, as applicable, and the percentage increase in the aggregate voting interest held by the holders of low vote common stock, as applicable. The results of these calculations are as follows.

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        In connection with the possible recapitalization, Lazard provided the committee with the resulting potential economic and voting interests of the holders of AMCE common stock, holders of Class B stock, the Apollo Funds and stockholders affiliated with Sandler Capital Management (who were collectively a significant stockholder of AMCE) assuming the payment of a three-year payment-in-kind dividend to the holders of AMCE preferred stock, with and without the exchange of shares of Class B stock into shares of AMCE common stock. For illustrative purposes, the calculations also were made showing AP Entertainment separately because it was unclear to Lazard and the committee whether AP Entertainment was controlled by Apollo. The results of these calculations are as follows.

Three-Year Payment-in-Kind Dividend
Without Class B Stock Exchanging into AMCE Common Stock

Three-Year Payment-in-Kind Dividend
With Class B Stock Exchanging into AMCE Common Stock

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        Lazard performed these calculations using the same assumptions but also assuming that the Apollo Funds would purchase an additional 333,742 shares of Class B stock as permitted under the terms of the Apollo standstill agreement. The results of these calculations are as follows.

Three-Year Payment-in-Kind Dividend
Without Class B Stock Exchanging into AMCE Common Stock

Three-Year Payment-in-Kind Dividend
With Class B Stock Exchanging into AMCE Common Stock

        Lazard's calculations illustrated a proposal of how, if the Apollo Funds agreed to a limitation, the voting power could be shared after the exchange of shares of Class B stock into shares of AMCE common stock such that the public shareholders would have a 56.9% voting interest and the Apollo Funds would have a 43.1% voting interest (or, if AP Entertainment were considered separately, the public shareholders would have a 59.6% voting interest and the Apollo Funds would have a 40.4% voting interest).

        In addition, in connection with the possible recapitalization, Lazard calculated for the committee that the present value of the dividends, if paid in cash, on the AMCE preferred stock for the period between April 19, 2004 and April 19, 2006 was approximately $37.5 million. Lazard calculated the economic implications to the holders of the AMCE preferred stock if AMCE declared an annual or

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extraordinary cash dividend prior to the conversion of the AMCE preferred stock into AMCE common stock. The results of these calculations are as follows.

        The Independent Committee considered the costs and benefits of the potential recapitalization transaction; however, the committee and the holders of AMCE preferred stock and the holders of Class B stock were unable to agree on the terms of any such transaction, including with respect to any payment and arrangements with respect to corporate governance.

        In March 2004, AMCE became aware that Loews Cineplex, which was privately held, intended to conduct a managed sale process. On March 23, 2004, AMCE executed a confidentiality agreement with Loews Cineplex and received information concerning Loews Cineplex that AMCE hoped would enable it to explore further a transaction between the two companies. AMCE engaged Goldman, Sachs & Co. to provide financial advisory services in connection with the Loews Cineplex process. AMCE's Board selected Goldman Sachs to act as its financial advisor because of Goldman Sachs' substantial experience in providing financial advisory services to companies engaging in transactions of the type under consideration. Goldman Sachs had previously provided capital raising and other financial advisory services for AMCE since 1998, and as a result was familiar with AMCE and its operations. In addition, the Board recognized that Goldman Sachs had other valuable industry experience, having served as financial advisor to Cinemark in connection with the recently-announced sale of that company.

        On April 8, 2004, AMCE's board of directors met to discuss the Loews Cineplex sale process. The Board considered again the merits of an acquisition of, or combination with, Loews Cineplex, and assessed AMCE's options for participating in the sale process. The Board considered, and discussed, the relative merits of AMCE's options, and the potential challenges inherent in any bid by AMCE (relative to a bid from a non-strategic acquiror of Loews Cineplex). At that meeting, the Board directed AMCE management and Goldman Sachs to continue to evaluate and analyze a potential combination with Loews Cineplex and to formulate an appropriate strategy to proceed in the auction process.

        At the April 8 meeting, the Board also requested that AMCE management, its financial advisors and the members of the independent committee continue to explore the corporate simplification transactions that were under consideration and to negotiate the potential terms thereof with AMCE's significant stockholders.

        On April 16, 2004, representatives of Goldman Sachs and AMCE's legal advisors met with legal and financial advisors to Loews Cineplex to discuss the ongoing Loews Cineplex auction process and AMCE's possible participation in that process.

        Following this meeting, members of AMCE's senior management continued to consider participation in the Loews Cineplex auction, but concluded, after consultation with members of the Board, representatives of Apollo and AMCE's financial advisors, that the potential issues with respect to an AMCE-Loews Cineplex transaction made a bid by AMCE unlikely to be successful, as it could be

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perceived by Loews Cineplex to be at a disadvantage relative to bids from non-strategic buyers. Accordingly, AMCE decided not to participate further in the Loews Cineplex auction process.

        During this period, AMCE and Goldman Sachs were contacted by representatives of a number of private equity firms who expressed interest in making investments in companies in the theatrical exhibition industry. Goldman Sachs was familiar with many of these private equity firms from its prior transaction experience, including as financial adviser to Cinemark in the Cinemark sale process.

        During the week of April 20, 2004, after informal consultation with members of AMCE's Board of Directors, members of AMCE senior management met with representatives of several major private equity firms that had expressed an informal interest in making an investment in the theatrical exhibition industry. AMCE management provided the representatives of such firms with an overview of the industry, AMCE and its historical financial results. AMCE management also discussed with them AMCE's business plan and financial projections.

        From time to time, other private equity firms and investors contacted Apollo to discuss Apollo's views of the industry. On April 21, 2004, Michael R. Hannon, a representative of J.P. Morgan Partners, which is the investment advisor for the JPMP Investors, met with a representative of Apollo to discuss Apollo's views of the industry and investment opportunities therein.

        On April 30, 2004, Mr. Hannon contacted Peter C. Brown, AMCE's Chairman, President and Chief Executive Officer, to request a meeting with representatives of AMCE and its financial advisors to discuss J.P. Morgan Partners' interest in exploring an investment in AMCE. Mr. Brown informally consulted with the members of AMCE's Board of Directors to discuss the planned meeting with J.P. Morgan Partners. On May 4, 2004, J.P. Morgan Partners and AMCE executed a confidentiality agreement, and on May 5 and May 6, 2004, Mr. Brown and other members of senior management met with representatives of J.P. Morgan Partners in AMCE's offices. These members of management provided to J.P. Morgan Partners an overview of the theatrical exhibition industry, AMCE and its historical financial results and shared other non-public information with respect to its business, including financial projections.

        Following these discussions in early May, members of AMCE's management and certain members of the AMCE Board who were nominated by Apollo informally discussed the possibility of a sale of AMCE to one or more of the investors who had expressed an interest in the industry.

        On May 14, 2004, Mr. Brown, Mr. Hannon and representatives of Goldman Sachs held a number of conversations about the possibility of J.P. Morgan Partners engaging in a transaction with AMCE.

        On May 21, 2004, Mr. Brown received from Mr. Hannon a letter which expressed J.P. Morgan Partners' preliminary interest in purchasing the outstanding capital stock of AMCE. The letter indicated that J.P. Morgan Partners, based on publicly available information and the financial forecasts made available to it, valued AMCE at $19.00 - $20.00 per share. The letter also indicated that such valuation and proposed cash purchase price assumed the need for between $700 million and $750 million in equity in such a transaction, of which J.P. Morgan Partners was willing to commit a substantial portion. The letter further expressed J.P. Morgan Partners' desire to conduct its due diligence investigation of AMCE and consummate a transaction on an accelerated basis.

        On May 25, 2004, the Board of Directors of AMCE held a regularly scheduled meeting. At that meeting, representatives of Goldman Sachs provided the Board with an update on the Loews Cineplex auction process and discussed with the Board various reasons for AMCE not to bid in the process, including the fact that potential issues with respect to timing and certainty of a Loews Cineplex-AMCE transaction made a bid by AMCE in this process unlikely to be successful. They also described the inquiries that AMCE had received from private equity investors, and the meeting that had taken place with representatives of J.P. Morgan Partners and other private equity firms to discuss AMCE's business and industry trends. Representatives of Goldman Sachs also provided the members of the Board with an overview of the investment banking climate for theatrical exhibition companies, noting that public

39

companies in the sector were trading at the high end of their 52-week trading history at that time and that the financing markets had been receptive to the transactions in the industry.

        At the May 25, 2004 meeting of AMCE's Board of Directors, Goldman Sachs presented various financial analyses, which analyses were subsequently updated and included in the financial analyses presented by Goldman Sachs to AMCE's Board of Directors on July 19, 2004 in connection with rendering its opinion described under the caption "Opinion of Goldman Sachs" on page 88. The material financial analyses in the May 25, 2004 presentation were subsequently updated in the final presentation made at the July 19, 2004 meeting to reflect the following: more recent historical share price and other financial information for AMCE and the comparable companies; the closing of an additional transaction in the theatre exhibition industry; updated financial forecasts from AMCE management; a decrease in estimated transaction expenses; a decrease in the interest rate applicable to the proposed debt to be incurred in connection with the merger; and the use of 2009 earnings before interest, income taxes, depreciation and amortization (EBITDA) trading multiples in all applicable analyses.

        At the May 25 meeting, utilizing forecasts prepared by AMCE management, the Board and representatives of Goldman Sachs discussed a number of strategic alternatives available to AMCE, including two hypothetical recapitalization transactions which would add leverage and use excess cash from AMCE's balance sheet to provide value to AMCE's stockholders. The first recapitalization transaction involved payment of a special dividend of $552 million to AMCE's stockholders and resulted in high and low present values of the implied prices per share of AMCE common stock, including the dividend, of $22.46 and $14.62, respectively. The second recapitalization transaction involved repurchases by AMCE of 75% of the outstanding AMCE common stock at $19.00 per share with an aggregate purchase price of $562 million, together with a $384 million private equity investment by a third party, and resulted in high and low present values of the implied prices per share of AMCE common stock that would remain outstanding of $22.95 and $4.84, respectively. Similar and updated analyses were performed by Goldman Sachs and presented to the Board at its July 19 meeting, see "Opinion of Goldman Sachs—Hypothetical Alternative Transaction Analysis" beginning on page 94. The Board also considered, and discussed, engaging in a potential strategic combination or merger, but concluded that the potential risks of non-consummation inherent in such a transaction, and the potential delays associated therewith, made it an unattractive alternative for AMCE's stockholders. The Board also considered a sale of AMCE and reviewed a Goldman Sachs analysis of the hypothetical returns to an acquirer in a cash sale of AMCE at a price of $20.00 per share, which returns ranged from 5% to 15.8% based on 2009 EBITDA trading multiples of 5.5x to 7.5x, as well as sensitivity analyses at different prices. See "Opinion of Goldman Sachs—Leveraged Buyout Analysis" on page 94 for a similar analysis at $19.50 per share as provided in the July 19 presentation of Goldman Sachs. The May 25 presentation of Goldman Sachs also included a selected transactions analysis, which resulted in latest twelve months (LTM) EBITDA multiples ranging from 5.0x to 7.5x, for transactions since 2000, and 7.4x to 13.2x for transactions before 2000. These results are identical to those in the July 19 presentation and the July 19 analysis included the Loews transaction which closed after May 25, 2004. See "Opinion of Goldman Sachs—Selected Transactions Analysis" beginning on page 92 for a description of the July 19 analyses. The May 25 presentation also included an analysis of implied premia to prices of AMCE common stock determined as of May 20, 2004 at purchase prices ranging from $15.00 to $25.00 and a comparison of selected publicly available financial information, ratios and multiples for AMCE and Carmike Cinemas Inc. and Regal Entertainment Group, two other publicly traded domestic theatre exhibitors. See "Opinion of Goldman Sachs—Historical Premium Analysis" beginning on page 90 and "Opinion of Goldman Sachs—Comparison of Selected Theatre Exhibitors" beginning on page 91 for similar analyses as provided in the July 19 presentation of Goldman Sachs. Finally, the Board considered maintaining the status quo, i.e., continuing to execute AMCE's business plan without a major transaction, but ultimately concluded that engaging in an extraordinary transaction would provide AMCE's stockholders with the best opportunity to more fully realize value for their shares in the short term.

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        The May 25th analyses presented by Goldman Sachs were preliminary in nature and, accordingly, were not relied upon by the AMCE Board of Directors in making its determination that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to AMCE and the unaffiliated AMCE stockholders. Further, the May 25th preliminary analyses, unlike the July 19th analysis, did not include an analysis for the "status quo" scenario or the blended total value of the $19.00 in cash to be paid for the 75% of the currently outstanding shares of AMCE common stock and the implied value of the shares of AMCE common stock that would remain outstanding, which is summarized under "recapitalization with private equity investment" in the table contained under the caption "Opinion of Goldman Sachs—Hypothetical Alternative Transaction Analysis" on page 94. Goldman Sachs relied upon the accuracy and completeness of all of the financial, accounting, legal, tax and other information discussed with or reviewed by it and assumed such accuracy and completeness for purposes of completing its May 25th presentation.

        Mr. Brown advised the full Board of the letter that he had received from J.P. Morgan Partners on May 21 expressing its interest in AMCE. The members of the Board expressed an interest in exploring a transaction with J.P. Morgan Partners and authorized management and AMCE's advisors to engage in discussions with J.P. Morgan Partners. At this juncture, the Board determined not to further pursue the preliminary inquiries received from other private equity firms, as it was the Board's belief that J.P. Morgan Partners had expressed the strongest interest in engaging in a transaction with AMCE and was a firm of the size and reputation as would be able to engage successfully in the transaction under consideration.

        Also at the May 25 meeting, several members of the Board noted the actual or potential conflicts of interest that could arise in connection with the Board's consideration of a transaction involving the sale of AMCE. As a result, the Board re-chartered the committee which had been formed in February 2004 and which consisted of two independent and disinterested directors, Charles Sosland and Paul Vardeman, to review, evaluate and make recommendations to the Board on behalf of the stockholders of AMCE (other than the Apollo Funds and the Durwood Voting Trust). We refer to this committee of the Board of Directors, as re-chartered, as the "Independent Committee." The Independent Committee was authorized to engage financial and legal advisors to assist it in its work.

        On May 27, 2004, the Independent Committee met by telephone and determined to engage Lazard as its investment banker (subject to agreement on the terms of the engagement, which were formally agreed upon on June 9, 2004), Polsinelli Shalton Welte Suelthaus PC ("Polsinelli") as its legal counsel, and Richards, Layton & Finger, P.A. ("Richards Layton") as its special Delaware legal counsel. In selecting Polsinelli as its legal counsel, the Independent Committee considered the following relationships among Mr. Vardeman, Polsinelli and AMCE and concluded Polsinelli was sufficiently independent of the Company, its management and major stockholders to fairly and effectively represent the interests of the Independent Committee. Mr. Vardeman was a shareholder of the predecessor law firm to Polsinelli from June 1983 until January 1998; however, since 1998, Mr. Vardeman has not been associated with Polsinelli, has not received any compensation from the firm other than deferred compensation and severance payments (all of which have been paid in full) and is not currently compensated by Polsinelli in any manner. Moreover, Mr. Vardeman will not be compensated by Polsinelli in connection with the Independent Committee's engagement of Polsinelli with respect to the merger. Polsinelli performed specific legal assignments on behalf of certain affiliates of the Company during the period from 1986 until 2001. Other than the compensation for those specific assignments and compensation for Polsinelli's work on behalf of the Independent Committee and the other independent committees of the AMCE Board described in this proxy statement, Polsinelli has not received any compensation from AMCE, and no future relationship between Polsinelli and AMCE or its affiliates is currently contemplated. The Independent Committee selected Lazard as its investment banker because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the merger. A previous independent committee of AMCE's board of directors which had been formed in February 2004 in connection with the consideration of possible

41

recapitalization transactions, and which included Mr. Vardeman and Mr. Sosland (the members of the Independent Committee), had engaged Lazard as its investment banker. As a result of this engagement, the Independent Committee believed Lazard had unique familiarity with AMCE and the issues to be considered by the Independent Committee. Accordingly, the Independent Committee resolved to engage Lazard as its investment banker in connection with the merger.

        Also at the May 27, 2004 meeting, a representative of Skadden, Arps, Slate, Meagher & Flom LLP, AMCE's outside special legal counsel ("Skadden Arps"), described for the members of the Independent Committee and its advisors the discussions that had taken place at the May 25 meeting of the Board of Directors.

        During the week of May 31, 2004, AMCE and representatives of Goldman Sachs held discussions with representatives of J.P. Morgan Partners and provided J.P. Morgan Partners with additional financial and operational information concerning AMCE relevant to the formulation of a definitive offer by J.P. Morgan Partners.

        On June 2, 2004, representatives of Goldman Sachs met with representatives of Lazard to discuss the advisors' respective views on the appropriate process for structuring and negotiating a potential transaction with J.P. Morgan Partners.

        On June 3, 2004, the Independent Committee met with its legal and financial advisors. The representatives of Lazard updated the Independent Committee on the meeting that had taken place the previous day with Goldman Sachs. The Independent Committee discussed whether it should insist on a public auction of AMCE. After receiving advice from its financial and legal advisors, the Independent Committee concurred with the full Board's conclusion that, if acceptable pricing and other terms could be negotiated, AMCE and its stockholders would be best served by pursuing a transaction with J.P. Morgan Partners without first soliciting indications of interest in AMCE from other parties.

        The representatives from Lazard reported that they had discussed with Goldman Sachs that Goldman Sachs would relate to J.P. Morgan Partners a per share target price. After the representatives from Lazard made a presentation to the Independent Committee that included several preliminary analyses regarding valuation, the Independent Committee determined that Lazard should report to Goldman Sachs the committee's view of a price target of $20.00. The Independent Committee also discussed several non-price issues of the proposed transaction, including the fact that the potential transaction with J.P. Morgan Partners, as being considered, would be a "change of control" for purposes of AMCE's Series A convertible preferred stock, which pursuant to the terms of the AMCE preferred stock would result in the payment of a special "in-kind" distribution of additional shares of AMCE preferred stock. The committee discussed and considered that this distribution (which would exceed the cost of cash dividends which would otherwise be payable at AMCE's option in cash on the Series A preferred stock) would not be payable if there were no change of control transaction prior to April 19, 2006.

        On June 3, 2004, the Board of Directors met to discuss the status of the discussions with J.P. Morgan Partners and the outcome of the discussions between Goldman Sachs and Lazard. The representatives from Goldman Sachs made an oral presentation to the Board that included a comparison of potential transaction prices to recent comparable transactions. Goldman Sachs also reported that Lazard had informed Goldman Sachs that the Independent Committee had agreed with the strategy of presenting J.P. Morgan Partners with a price target after J.P. Morgan Partners had completed its preliminary financial due diligence. The Board of Directors authorized Goldman Sachs, subject to approval by the Independent Committee, to approach J.P. Morgan Partners with a target price of $20.00.

        In addition, at the June 3 meeting, the Board discussed and considered soliciting or pursuing other indications of interest for AMCE. After consulting with its legal and financial advisors, the Board unanimously believed that it was more likely to achieve a higher value in a negotiated transaction, that

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is, without conducting an auction. The Board also determined that, if AMCE were to pursue a transaction with J.P. Morgan Partners without first soliciting other indications of interest in AMCE, it would require sufficient flexibility to consider, and accept, alternative proposals which might emerge after execution of an agreement with J.P. Morgan Partners.

        On June 3 and June 4, 2004, representatives of J.P. Morgan Partners met with members of AMCE's senior management and representatives of Goldman Sachs in Kansas City to conduct a business and financial due diligence review of AMCE.

        Following these meetings, representatives of Goldman Sachs met with representatives of J.P. Morgan Partners to discuss their respective views with respect to transaction valuation. They also discussed in principle AMCE's requirement that, should it elect to enter into a transaction with J.P. Morgan Partners, any definitive agreement (including voting agreements) with respect to such a transaction would need to provide AMCE and its Board of Directors ample opportunity to consider, and accept, superior proposals or alternative transactions that might emerge (such provisions are often referred to as a "fiduciary out"). Representatives of Goldman Sachs also stressed that AMCE's willingness to proceed with J.P. Morgan Partners was conditioned on proceeding on an accelerated timeline, so as to avoid unnecessary disruption of AMCE's business. Subject to such conditions, Goldman Sachs indicated to J.P. Morgan Partners AMCE's willingness to consider a transaction for all of AMCE's outstanding stock at a price of $20.00 per share.

        During the week of June 7, 2004, representatives of Skadden Arps discussed with representatives of Polsinelli and Richards Layton, counsel to the Independent Committee, the specific terms of the "fiduciary out" provision which AMCE would require in any definitive agreement, as well as provisions relating to termination fees and expense reimbursement.

        On June 9, 2004, the Independent Committee met with its advisors to discuss possible terms of the potential transaction. The committee discussed certain potential key issues, including price, the terms of the Series A convertible preferred stock, the "fiduciary out" and termination fee provisions and the possibility, based on the Independent Committee's preliminary understanding of the amount of equity that might be required to complete the transaction, of the Apollo Funds maintaining an equity interest in AMCE following the proposed transaction. In particular, the Independent Committee discussed the importance of the "fiduciary out" provisions and minimizing any break-up fee or expense reimbursement that would be payable upon termination of a potential transaction with J.P. Morgan Partners.

        On June 11, 2004, Skadden Arps provided an outline of AMCE's requirements, together with draft contractual provisions, to J.P. Morgan Partners and its outside counsel, Latham & Watkins LLP. The initial proposal presented to J.P. Morgan Partners set forth the specific terms of the "fiduciary out" provisions AMCE would require in any definitive agreement. That proposal did not include any provisions related to the payment of "break-up" fees by AMCE upon termination of the agreement by AMCE to pursue an alternative transaction, but did provide that AMCE would reimburse J.P. Morgan Partners for its out-of-pocket expenses under such circumstances, subject to an unspecified cap.

        On June 11, 2004, AMCE's Board again met to be updated on the progress of the potential transaction. Representatives of Goldman Sachs informed the Board of the understanding that had been reached with representatives of the Independent Committee as to the terms of the "fiduciary out" provisions, and Goldman Sachs described the meetings that had taken place earlier that week with representatives of J.P. Morgan Partners.

        On June 14, 2004, Mr. Brown received another letter from Mr. Hannon confirming J.P. Morgan Partners' interest in AMCE. The letter indicated that, based on its further due diligence, J.P. Morgan Partners would be willing to purchase all of the outstanding shares of AMCE for $19.00 per share in cash, subject to J.P. Morgan Partners reaching satisfactory agreement with Apollo regarding Apollo's participation in such transaction. The letter indicated that if Apollo were not willing to participate in

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the transaction, J.P. Morgan Partners would be willing to purchase all outstanding shares of AMCE at $18.50 per share. The difference in price was primarily attributed to additional costs associated with the complete refinancing of AMCE's balance sheet, which refinancing would not be necessary under the terms of AMCE's existing debt if Apollo were to continue to be a member of a group that owned a majority of AMCE's capital stock after the transaction; if Apollo were not to participate in the ownership group, the change of control provisions in the indentures governing two series of AMCE's senior subordinated notes, representing $475 million in principal amount of indebtedness, would be triggered. The letter also indicated that Apollo's continued investment in AMCE would improve the certainty of obtaining adequate financing on acceptable terms. J.P. Morgan Partners also requested a three-week exclusivity period to complete due diligence, arrange financing and reach agreement with Apollo and AMCE.

        In addition, on June 14, 2004, Latham & Watkins provided Skadden Arps with a response to the "fiduciary out" provisions which had been previously furnished by Skadden Arps. Latham & Watkins indicated that J.P. Morgan Partners would only be willing to engage in a transaction if AMCE were required to pay to J.P. Morgan Partners a termination or "break up" fee if AMCE terminated the agreement to pursue an alternative transaction. Finally, Latham & Watkins indicated that J.P. Morgan Partners would require voting agreements from AMCE's significant stockholders in connection with a transaction.

        Later that day on June 14, 2004, AMCE's Board of Directors met to discuss the status of the transaction and the most recent letter that had been received from J.P. Morgan Partners. At the meeting, representatives from Goldman Sachs compared the valuation described in the letter to the previous indication of interest that had been received from J.P. Morgan Partners and to the multiples that had been achieved in the Cinemark sale process, and noted that the press had reported that multiples of a similar level were being considered in the Loews Cineplex sale process. The Board of Directors instructed Goldman Sachs to work with Lazard, the financial advisors to the Independent Committee, to consider and develop valuations for AMCE in a transaction which involved participation by the Apollo Funds in order to assist in the determination of whether to continue discussions with J.P. Morgan Partners. Goldman Sachs was also instructed to inform J.P. Morgan Partners that AMCE could not engage in a transaction with J.P. Morgan Partners at the valuation levels proposed in its June 14 letter, and to request that J.P. Morgan Partners revise its proposal.

        On June 15, representatives of Goldman Sachs met with representatives of Lazard to discuss the proposal received from J.P. Morgan Partners on June 14 and also to discuss that J.P. Morgan Partners would need to be informed that the price expressed in such proposal was too low. They also discussed the voting arrangements that J.P. Morgan Partners would require as part of the transaction.

        On June 16, 2004, the Independent Committee met with its legal advisors and representatives of Lazard. The participants discussed the implications if the Apollo Funds maintained an equity interest in AMCE following the proposed transaction. They also discussed the different prices per share set forth in the letter from J.P. Morgan Partners, including the reasons proffered for the difference in price, that is, the fact that a significant portion of the Company's indebtedness would not have to be refinanced if the Apollo Funds maintained an equity interest in AMCE following the transaction. The Independent Committee noted that the Apollo Funds maintaining an interest would be favorable to AMCE's stockholders to the extent it resulted in the stockholders receiving a higher price in the transaction. After discussion, the Independent Committee instructed Lazard to inform Goldman Sachs that an offer would only be acceptable to the Independent Committee at or very near to $20.00 per share, and that the Independent Committee would be particularly focused on the ability to terminate the transaction to accept a more favorable proposal were such a proposal to be received after a merger agreement was signed.

        On June 18, 2004, representatives of Goldman Sachs informed J.P. Morgan Partners that AMCE would be willing to consider a transaction which involved participation by the Apollo Funds if the

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consideration payable to AMCE's common stockholders was acceptable, and requested that J.P. Morgan Partners revise its proposal. J.P. Morgan Partners indicated at that time that while it had some flexibility to increase its offer above $19.00 per share, it would be unable to offer the $20.00 share price that Goldman Sachs had initially requested. J.P. Morgan Partners also indicated that, in order to reach agreement on the fiduciary out provisions to be included in a purchase agreement, it would require a break-up fee. J.P. Morgan Partners proposed that the size of the break-up fee be $25 million (including out-of-pocket expenses), which represented approximately 1.5% of the equity value of AMCE in a transaction which valued the shares of AMCE stock in the $19.00 - $20.00 range. J.P. Morgan Partners also emphasized that its proposal was based on the assumption that AMCE would meet or exceed its financial forecasts which had been previously provided to J.P. Morgan Partners. Following this conversation, representatives of Goldman Sachs reported to Lazard on the conversation that had taken place between Goldman Sachs and J.P. Morgan Partners.

        Later on June 18, 2004, AMCE's Board of Directors met to receive an update on the status of discussions with J.P. Morgan Partners. Representatives of Goldman Sachs described the discussions that had taken place earlier that day with J.P. Morgan Partners, and expressed their belief that an agreement could be reached with J.P. Morgan Partners on a transaction with a per share price of $19.50 and involving termination fees in the range proposed by J.P. Morgan Partners, if agreement could be reached with the Apollo Funds regarding their participation in the transaction. The Board members discussed a price of $19.50, the fiduciary out and termination fee provisions, and considered the possibility that seeking a price in excess of $19.50 per share could have potential adverse consequences to the negotiations with J.P. Morgan Partners. The Board authorized Goldman Sachs to respond to J.P. Morgan Partners with a price of $19.50 per share, subject to the Independent Committee approval of the price. The Board also instructed Goldman Sachs to inquire about the level of participation by the Apollo Funds that J.P. Morgan Partners was seeking.

        Also at the meeting on June 18, 2004, in executive session, the Board of Directors appointed Charles J. Egan, Jr., a member of the Board, to oversee the negotiations with J.P. Morgan Partners on behalf of the entire Board.

        Following the meeting of the Board on June 18, 2004, the Independent Committee met with its financial and legal advisors. The representatives of Lazard updated the Independent Committee on the report it had received from Goldman Sachs as to its discussions with J.P. Morgan Partners earlier that day. The Independent Committee discussed with its advisors a preliminary analysis of the $19.50 per share price under various valuation methodologies, the terms of the Series A convertible preferred stock and the implications of the Apollo Funds maintaining an equity interest in AMCE following the proposed transaction. The Independent Committee requested that Lazard inform Goldman Sachs that (i) $19.50 was the minimum price acceptable to the Committee, (ii) a termination fee of $25 million was acceptable, (iii) the committee required the termination provisions in the event of a superior offer to be consistent with terms most recently circulated among the parties, (iv) a request be made of J.P. Morgan Partners to confirm its offer in the event that the Apollo Funds were not to participate in the equity of AMCE following the transaction, (v) the Independent Committee be informed of the nature of the Apollo Funds' participation in the equity of the surviving company following the transaction and (vii) J.P. Morgan Partners be requested to confirm that Apollo would not receive any part of the $25 million termination fee, if it were to be paid.

        Following the meeting of the Independent Committee, Lazard communicated to Goldman Sachs the points which had been outlined by the Independent Committee at the meeting. In addition, Lazard communicated the Independent Committee's insistence that the Apollo Funds purchase their continuing equity in AMCE at the same price and on the same terms as J.P. Morgan Partners. Finally, Goldman Sachs and Lazard agreed that, in order to avoid unnecessary disruption of AMCE's business and diversion of its resources, and in order to protect against market leaks, AMCE should insist on an accelerated timeline for entering into any definitive agreement with respect to the transaction.

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        On June 20, 2004, representatives of Goldman Sachs communicated to J.P. Morgan Partners the terms on which AMCE would be willing to proceed with a transaction, as had been discussed by Lazard and Goldman Sachs the previous day. Representatives of J.P. Morgan Partners noted that they needed to discuss the possibility of the Apollo Funds' participation with representatives of Apollo. J.P. Morgan Partners also reiterated its willingness to engage in a transaction if the Apollo Funds were unwilling to participate but at a price per share which was at least $0.50 per share lower. Finally, J.P. Morgan Partners reiterated that the previous proposals that it had made to AMCE were based on the assumption that AMCE would meet or exceed its internal financial forecasts for the twelve months ending July 1, 2004.

        On June 21, 2004, AMCE's Board of Directors met to discuss the status of the negotiations with J.P. Morgan Partners. The members of the Board discussed the announcement that had been made earlier that day that a definitive agreement had been reached with respect to the sale of Loews Cineplex, and took note that the participation in such transaction by three private equity firms who had been rumored to have an interest in making an investment in the theatrical exhibition industry would likely decrease the number of parties who would potentially be interested in pursuing a transaction with AMCE. Representatives of Goldman Sachs observed that, following the Cinemark and Loews Cineplex auctions, there remained only a few major private equity firms (including J.P. Morgan Partners) who had been thought to be interested in making an investment in the theatrical exhibition industry that still had yet to do so. They noted that the purchase price in the Loews Cineplex transaction represented a multiple of approximately 7.5 times Loews Cineplex's trailing twelve-month EBITDA (earnings before deductions for interest, taxes, depreciation and amortization), which was comparable to the multiple received by the stockholders of Cinemark in the transaction that had been announced in March. Representatives of Goldman Sachs also updated the Board on the discussions that had taken place with J.P. Morgan Partners over the previous two days, including J.P. Morgan Partners' focus on AMCE's projections for the twelve months ending July 1, 2004. A representative of Apollo indicated that a meeting between representatives of J.P. Morgan Partners and Apollo had been scheduled for June 23 to discuss the possibility of, and parameters for, participation by the Apollo Funds in the transaction with J.P. Morgan Partners. After considering further the proposed termination fees and fiduciary out provisions for a transaction with J.P. Morgan Partners, the Board directed Goldman Sachs and management of AMCE to continue discussions with J.P. Morgan Partners to see if acceptable terms for a transaction might be reached. The Board also instructed Skadden Arps to prepare an initial draft of a merger agreement for the transaction for circulation to J.P. Morgan Partners.

        On June 22 and June 23, 2004, representatives of Skadden Arps, Richards Layton and Polsinelli discussed the terms of a draft merger agreement that was prepared by Skadden Arps. They also discussed generally the terms of the voting arrangements by which Apollo and the Durwood Voting Trust would be required to support the transaction.

        On June 23, 2004, representatives of Apollo met with representatives of J.P. Morgan Partners to discuss the potential for the Apollo Funds' participation in the transaction at a proposed price of $19.50 per share. At that meeting, J.P. Morgan Partners indicated that it would like the Apollo Funds to maintain a one-third interest in AMCE following the transaction. J.P. Morgan Partners indicated that it would like to maintain a similar equity interest, and had hoped to identify a third investor to participate in the transaction for the remaining one-third interest.

        On June 24, 2004, Skadden Arps delivered a draft of the merger agreement to Latham & Watkins for distribution to J.P. Morgan Partners.

        On June 25, 2004, representatives of J.P. Morgan Partners met with members of AMCE's senior management at AMCE's headquarters in Kansas City to conduct a detailed review of AMCE's financial performance. Also on that date, representatives of J.P. Morgan Partners and its financial and legal

46

advisors commenced a due diligence investigation of AMCE at the offices of Skadden Arps in New York.

        On June 26, 2004, a representative of Goldman Sachs received an informal inquiry from a representative of Cinemark about AMCE's willingness to consider, or engage in, a strategic transaction with Cinemark.

        On June 28, 2004, AMCE's Board of Directors met to discuss the developments that had taken place over the previous week and the status of the ongoing negotiations with J.P. Morgan Partners. Representatives from Goldman Sachs reported that Apollo had indicated its willingness to participate in the transaction with J.P. Morgan Partners and a third investor, with each equity participant owning approximately one-third of AMCE following the transaction. The Board also discussed the proposed purchase price of $19.50 per share, and the impact AMCE's financial performance for the quarter ending July 1, 2004 might have on that price if AMCE's performance were to fall short of previous projections. The Board also discussed generally the status of J.P. Morgan Partners' efforts to arrange financing for the proposed transaction. A representative of Apollo indicated that Apollo had been working with J.P. Morgan Partners to explore financing that would enable J.P. Morgan Partners and Apollo to proceed with the transaction at a price of $19.50 per share.

        Also at the June 28 meeting, representatives of Goldman Sachs relayed to the Board the inquiry that had been made by the representative of Cinemark two days earlier. After considering a number of factors, including (i) the potential risks of non-consummation posed by in a strategic transaction involving the two companies, and the potential timing delays associated therewith; (ii) the Board's belief that Cinemark's high leverage made a cash offer from Cinemark unlikely to be forthcoming; (iii) the beliefs expressed by Company management and members of the Board that integration of the two companies could be difficult; and (iv) the possibility that pursuing the proposal could jeopardize the ongoing negotiations with J.P. Morgan Partners or result in a decrease in J.P. Morgan Partners' proposed per share price, AMCE's Board decided not to pursue the inquiry further and instructed Goldman Sachs to convey to the party making such inquiry that the Board had been advised of the inquiry.

        Between June 29 and July 3, representatives of AMCE and its legal and financial advisors, in consultation with the legal and financial advisors to the Independent Committee, continued to negotiate the terms of the merger agreement with J.P. Morgan Partners and its legal advisors. Throughout these negotiations, Latham & Watkins, as counsel to J.P. Morgan Partners, continued to insist that the transaction include voting agreements from AMCE's significant stockholders. J.P. Morgan Partners also insisted that the transaction include as a condition to J.P. Morgan Partners' and Apollo's obligations the receipt of adequate financing to fund the transaction. Finally, J.P. Morgan Partners indicated that its willingness to engage in the transaction was conditioned upon reaching satisfactory arrangements with Mr. Brown and Mr. Philip M. Singleton, AMCE's chief operating officer, as to their continued employment with AMCE.

        During this time, representatives of J.P. Morgan Partners began to discuss with Messrs. Brown and Singleton the terms on which those individuals would continue their employment following the transaction. Messrs. Brown and Singleton preliminarily agreed to affirm their existing employment agreements and waive the "change of control" provisions in those agreements for purposes of the transaction, subject to reaching further agreement with J.P. Morgan Partners on the terms of a post-transaction equity plan to be established for members of AMCE's senior management team and on the size and terms of re-investment by Messrs. Brown and Singleton of a portion of their proceeds received in the transaction from sales of stock, exercises of stock options and conversion of deferred stock units. J.P. Morgan Partners also discussed these plans generally with Mr. Egan during this period.

        On June 29, Skadden Arps circulated to Apollo and the Durwood Voting Trust and their respective legal advisors draft voting agreements for the transaction.

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        On June 30, a private equity firm which had been introduced to AMCE by J.P. Morgan Partners executed a confidentiality agreement and commenced a due diligence investigation of AMCE, with a view toward participating in the transaction with J.P. Morgan Partners and the Apollo Funds.

        On June 30 and July 1, the Independent Committee and its financial and legal advisors met in New York. At those meetings, the members of the Independent Committee discussed the issues related to the latest drafts of the merger agreement and the voting agreements between each of Apollo and the Durwood Voting Trust and AMCE and the status of the negotiations with respect to those agreements. The Independent Committee discussed in detail the preliminary valuation analysis Lazard had prepared and each of the valuation methodologies used in the preliminary valuation analysis.

        On July 1, 2004, AMCE's Board of Directors met to receive an update on the status of discussions with J.P. Morgan Partners and on the efforts of J.P. Morgan Partners and Apollo to arrange financing for the transaction.

        On July 6 and 7, 2004, representatives of J.P. Morgan Partners met with members of AMCE management and Goldman Sachs at AMCE's headquarters in Kansas City to review AMCE's preliminary financial results for the fiscal quarter ended July 1, 2004. AMCE's adjusted EBITDA for the twelve months ended July 1, 2004 fell short of AMCE's internal projections that J.P. Morgan Partners had represented formed the basis for its valuation of AMCE. Following these meetings, J.P. Morgan Partners indicated to AMCE's financial advisors that it would have difficulty in reaching the proposed per share price of $19.50. Shortly after these meetings, the private equity firm that had been identified by J.P. Morgan Partners as a potential third participant in the transaction informed J.P. Morgan Partners that it was unwilling to participate in the transaction because they did not believe their return on the investment would meet their expectations.

        During the days following these meetings, Lazard reiterated to Goldman Sachs the Independent Committee's position that a reduction in the price below $19.50 per share was not acceptable, and Goldman Sachs communicated this position to J.P. Morgan Partners.

        Over the weekend of July 10-11, 2004, Mr. Hannon contacted Mr. Brown and indicated that, while J.P. Morgan Partners was still willing to engage in a transaction at a price up to $19.50 per share of AMCE common stock, it was unable to commit the amount of equity necessary to support AMCE's proposed post-transaction capital structure; accordingly, Mr. Hannon indicated that J.P. Morgan Partners would require either participation by an additional equity investor or an increase in the proposed level of participation by the Apollo Funds.

        On July 13, 2004, Mr. Brown received a letter from Stephen P. Murray of J.P. Morgan Partners, confirming J.P. Morgan Partners' interest in purchasing all of the outstanding shares of common stock of AMCE in a going-private transaction at a per share price of $19.50. The letter indicated that J.P. Morgan Partners would be willing to commit to provide 51% of the equity necessary for such transaction, if the Apollo Funds were willing commit the remaining 49% of the required equity; the letter also reserved the right to bring in another equity sponsor to fulfill a portion of J.P. Morgan Partners' commitment and/or the Apollo Funds' commitment. Further, the letter indicated that J.P. Morgan Partners' willingness to engage in the transaction was conditioned on definitive agreements being executed by the parties no later than July 25, 2004.

        AMCE's Board of Directors met later in the day on July 13, 2004 to discuss the status of the transaction and the letter that had been received earlier that day from Mr. Murray. The Board inquired as to Apollo's views with respect to the proposal that had been received from J.P. Morgan Partners. A representative of Apollo indicated that, while it was the Apollo Funds' desire to participate in the transaction at a lower level of equity investment, the Apollo Funds would be willing to commit to 49% of the required equity for the transaction if they had a reasonable opportunity to reduce their commitment.

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        The Board considered remarks that had been made by representatives of J.P. Morgan Partners and Apollo to the effect that capitalizing on current favorable conditions in the financing markets was critical to their ability to transact at a price of $19.50 per share. The Board also discussed the possibility of J.P. Morgan Partners and Apollo funding the transaction through an escrow arrangement, that is, by obtaining necessary funds for the transaction shortly following announcement of the merger and holding the proceeds in escrow pending satisfaction of the other conditions to the transaction. The Board noted J.P. Morgan Partners' previous insistence that such parties' obligation to consummate the proposed transaction be subject to a financing condition, and observed that funding the proceeds of such financing into escrow shortly after execution of a definitive agreement could provide additional certainty for AMCE by obtaining necessary funds at an early date.

        After representatives of Apollo were excused from the Board meeting, the remaining members of the Board considered the proposal received from J.P. Morgan Partners. Representatives of Skadden Arps again reviewed with the members of the Board their fiduciary duties with respect to consideration of the transaction. The Board discussed the proposed increase in the Apollo Funds' participation in the transaction, including the one time special "in kind" distribution to which the Apollo Funds would be entitled as a holder of AMCE's Series A convertible preferred stock. The Board discussed the implications of the proposed "escrow funding" and considered the potential impact that a "pre-funded" transaction might have on potential bidders who might otherwise express interest in engaging in a transaction with AMCE. Following its discussions, the Board directed AMCE management and its legal and financial advisors to pursue the transaction with Apollo and J.P. Morgan Partners on the terms proposed.

        Following this meeting, in the evening of July 13, representatives of Skadden Arps and Latham & Watkins met and renewed their previous negotiations on the terms of the merger agreement. These negotiations continued over the course of several days.

        On July 15, 2004, Skadden Arps circulated draft voting agreements for Apollo and the Durwood Voting Trust to all parties. Between July 15 and July 19, 2004, representatives of Skadden Arps, Richards Layton, Wachtell, Lipton, Rosen & Katz, counsel to Apollo, Latham & Watkins and Hughes Hubbard & Reed LLP, special counsel to the Durwood Voting Trust, negotiated the terms of the merger agreement and the voting agreements.

        On July 15, 2004, AMCE and its legal advisors received draft commitment letters for the financing package which was to be arranged for J.P. Morgan Partners and Apollo by Citigroup Global Markets Inc. and J.P. Morgan Securities Inc., an affiliate of J.P. Morgan Partners. Legal and financial advisors to AMCE and the Independent Committee participated in discussions and revisions of the draft commitment letters over the course of the next several days, with a view toward improving the commitments from AMCE's perspective by reducing the conditionality contained therein. Also during this period, J.P. Morgan Partners and Apollo indicated that, as their ability to engage in a transaction at $19.50 was contingent upon obtaining financing through an escrow funding, they were unwilling to assume the "breakage" costs associated therewith, that is, the expenses that would be incurred by the borrowers if the transaction were not consummated and the escrowed proceeds from the financing had to be returned to the lenders; accordingly, J.P. Morgan Partners and Apollo indicated that they would require AMCE to bear any such costs.

        On July 16, 2004, another private equity firm executed a confidentiality agreement and commenced a due diligence investigation of AMCE, with a view toward participating in the transaction with J.P. Morgan Partners and Apollo. Representatives of this private equity firm met with members of AMCE management on July 17 for a review of AMCE's financial performance. Following these meetings, this private equity firm informed AMCE that it would not participate in the transaction because they did not believe their return on the investment would meet their expectations.

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        On July 19, the Independent Committee and its financial and legal advisors met in Kansas City. The Independent Committee received from Skadden Arps and Mr. Egan an update on the status of the negotiations and the remaining unresolved issues. A representative of Skadden Arps relayed to the Independent Committee the proposed financing structure for the transaction, including the fact that J.P. Morgan Partners and Apollo had affirmatively stated on a number of occasions that rapid access to the current financing markets (and depositing the proceeds into escrow pending the closing of the merger) was crucial to their willingness and ability to engage in a transaction at a price of $19.50 per share. They reviewed in detail with the Independent Committee the potential "breakage" costs associated with the escrow financing and the circumstances under which AMCE would be required to pay such costs if the merger agreement were to be terminated. After the representatives of Skadden Arps and Mr. Egan left the meeting, Lazard presented the Independent Committee with an analysis of break-up fees in merger and acquisition transactions involving U.S. targets and announced after January 1, 2001 where the transaction size was in excess of $500 million. The results of this analysis were as follows:

Following this presentation, the Independent Committee determined to authorize Mr. Egan to negotiate total termination and expense reimbursement fees, including escrow breakage fees, not to exceed 3% of the transaction equity value. Lazard then presented and discussed with the committee the valuation materials Lazard had prepared, including an analysis of the $19.50 per share price under various valuation methodologies.

        In addition to the analyses performed by Lazard and described in "Special Factors—Opinion of Lazard," Lazard presented the Independent Committee with an analysis of premiums paid in certain transactions since 1999 where a financial buyer acquired a U.S. public company for an amount in excess of $250 million. Lazard derived the low, median and high premiums paid in such transactions based on the target's closing share price one day, one week and four weeks prior to the announcement of the transaction. The results of this analysis were as follows:

        Lazard multiplied:

•

the one-day low, median and high premiums by the per share price of AMCE's common stock on July 16, 2004;



•

the one-week low, median and high premiums by the per share price of AMCE's common stock one week prior to July 16, 2004; and



•

the four-week low, median and high premiums by the per share price of AMCE's common stock four weeks prior to July 16, 2004.

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        The results of this analysis were as follows:

        Lazard also presented the Independent Committee with ranges of multiples implied by various possible prices of AMCE's common stock. Although Lazard considered the range of premiums paid an appropriate benchmark for consideration, Lazard did not use these ranges or the analysis of premiums paid in its fairness analysis because Lazard did not view premiums paid in the transactions by financial buyers as indicative of the value of AMCE because of the diversity of the businesses of the target companies, the period of time over which the transactions were spread and the number of transactions.

        Later that day, the Board of Directors of AMCE also met to discuss the status of negotiations and to review the terms of the proposed transaction. The members of the Board affiliated with Apollo did not attend the meeting. The Board received a detailed presentation from Goldman Sachs, including various financial analyses utilizing different methodologies. Goldman Sachs also reviewed with the Board various strategic alternatives potentially available to AMCE, as had been previously discussed with, and considered by, the Board (including at the May 25, 2004 meeting). Also at this meeting, Skadden Arps reviewed the fiduciary duties of AMCE's Board of Directors, as well as the principal terms and conditions of the proposed transaction as reflected in the draft merger agreement and voting agreements, including the circumstances related to the payment of termination fees; the ability of AMCE to provide information to, and negotiate with, third parties concerning competing proposals; and the conditions to consummation of the transaction, including the condition related to J.P. Morgan Partners and Apollo obtaining adequate financing to consummate the transaction.

        At the July 19, 2004 meeting, representatives of Skadden Arps and Goldman Sachs also outlined for the Board the proposed financing structure for the transaction, and statements that had been made by representatives of J.P. Morgan Partners and Apollo to the effect that rapid access to the financing markets and depositing the proceeds into escrow pending the closing of the merger was critical to its willingness and ability to engage in a transaction at a price of $19.50 per share. They also reviewed in detail with the Board the potential "breakage" costs associated with the escrow financing and the circumstances under which AMCE would be required to pay such costs if the merger agreement were to be terminated. The Board discussed these matters and the impact that such costs might have on potential third party bidders in light of the "fiduciary out" provisions that had been negotiated. Also at the meeting, the Board took into account its concern, which was based in part on the views expressed by AMCE's financial advisors following its discussions with representatives of J.P. Morgan Partners and Apollo, that insistence by AMCE that J.P. Morgan Partners and Apollo pursue a more traditional financing approach (i.e., accessing the financing markets at the time of closing of the merger) might ultimately endanger the transaction at a $19.50 share price level. After consideration of these issues, and the expression of the Independent Committee's views on these issues, the Board instructed Mr. Egan and AMCE's legal and financial advisors to continue to negotiate with J.P. Morgan Partners and Apollo, with a view toward reducing the conditionality of the transaction and reducing the size of the potential fees and expenses for which AMCE might become liable.

        On July 20, 2004, published reports appeared in several news sources to the effect that AMCE was close to agreeing to be acquired by J.P. Morgan Partners in a transaction valued between $19.00 and $20.00 per share. As a result of such rumors, the trading price of AMCE's common stock increased by more than 20% during that day.

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        Also on July 20, 2004, Mr. Egan met with Mr. Hannon to discuss generally the circumstances under which J.P. Morgan Partners had required that AMCE pay termination fees and reimburse J.P. Morgan Partners for any "breakage" costs associated with the escrow financing. After some discussion, Mr. Egan proposed that AMCE would reimburse J.P. Morgan Partners for its breakage costs under circumstances where the merger agreement had been terminated because AMCE's board had accepted or recommended an alternative transaction, so long as the termination fee of $25 million, which had been previously agreed to by the parties, was reduced dollar-for-dollar by the amount of any such expenses paid by AMCE.

        Over the course of the next two days, representatives of AMCE, the Independent Committee, J.P. Morgan Partners and Apollo and their respective legal counsel continued to negotiate the terms of the merger agreement, with a focus on the circumstances under which AMCE would reimburse J.P. Morgan Partners for escrow breakage costs in the event the merger agreement were to be terminated. Throughout the course of these negotiations, J.P. Morgan Partners continued to emphasize its view that the escrow financing arrangements were being put in place for the benefit of AMCE and its stockholders, as capitalizing on the favorable conditions in the debt markets was a critical component in J.P. Morgan Partners' and Apollo's ability to transact at a $19.50 share price; accordingly, J.P. Morgan Partners and its representatives continued to insist that AMCE be responsible for the escrow breakage costs if the merger agreement were to be terminated under any circumstances. In exchange for AMCE agreeing to bear such costs and to pay J.P. Morgan Partners an expense reimbursement fee of $10 million in the event the merger agreement were to be terminated to accept a superior proposal, J.P. Morgan Partners agreed to eliminate the $25 million termination fee which had been previously agreed upon by the parties. J.P. Morgan Partners expressed its view that it would require a $10 million expense reimbursement fee in light of the significant expenses that it would incur shortly after execution of the merger agreement as a result of the accelerated financing schedule.

        During this time, the parties' respective legal counsel also continued to negotiate the terms of the voting agreements, debt and equity commitment letters and other related transaction documents. J.P. Morgan Partners also discussed with Messrs. Brown and Singleton over a several day period the proposed post-transaction employment and equity participation arrangements for each of them and for members of AMCE's senior management team.

        On the afternoon of July 21, 2004 the Independent Committee and its legal advisors met. At the invitation of the Independent Committee, representatives of Skadden Arps updated the participants on the status of the negotiations and the remaining open issues. After the representatives of Skadden Arps excused themselves from the meeting, the participants discussed the negotiations of the total termination fees payable and the various circumstances under which fees and expenses would be payable. The Independent Committee was advised that J.P. Morgan Partners had indicated that it was only prepared to pay $19.50 per share if J.P. Morgan Partners and Apollo could access the financing markets soon after signing definitive agreements and close the financing into escrow and that Apollo had indicated that it would not consent to any proposed transaction pursuant to the "approval rights" granted pursuant to the Apollo investment agreement at a price of less than $19.50 per share. The Independent Committee discussed that Apollo had also stated previously that it would only participate in the equity of the surviving company at a price of $19.50 per share if the financing could be closed into escrow. The Independent Committee discussed these factors with its advisors. The Independent Committee was advised that the total fees payable upon termination of the merger would be approximately 2.5% of the transaction equity value. Lazard presented the Independent Committee with an analysis of the circumstances in which termination fees and/or expenses were payable in transactions announced in 2003 and 2004. The Independent Committee determined that the possibility of AMCE having to pay such fees was acceptable to it, in part because it is within the range of fees payable in comparable transactions and thus should not prevent a superior offer from being made by anyone desiring to do so, and because it was necessary in order to achieve $19.50 per share for the unaffiliated

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stockholders. In this context, it was noted that two private equity firms had been invited to participate in the transaction but had declined to do so at the $19.50 price. Lazard reported that the press reports of a potential transaction that had appeared the previous day did not materially change the valuation analysis Lazard had previously presented to, and discussed with, the Independent Committee. Lazard also presented orally an updated valuation analysis to the Independent Committee.

        Later on July 21, 2004, the Board of Directors met to receive an update on the status of negotiations with J.P. Morgan Partners and Apollo. The members of the Board affiliated with Apollo did not attend the meeting. Representatives of Skadden Arps reviewed with the Board the negotiations that had taken place over the previous two days. They also reviewed in detail the potential escrow breakage costs and J.P. Morgan Partners' continued insistence that AMCE bear any such costs in the event the merger agreement were to be terminated for any reason. The Board took note that, in the earliest phases of negotiations with J.P. Morgan Partners, a break-up fee of $25 million would have been payable solely in connection with a termination of the merger agreement by reason of an alternative transaction, and it discussed the additional, unrelated circumstances under which AMCE might now be required to pay expenses. The Board also noted that the maximum amount of expenses for which AMCE might become liable represented approximately 2.5% of the transaction equity value, and considered the views expressed by AMCE's legal counsel on such matters. In considering the comments of AMCE's legal counsel, the Board also considered other factors, including the fact that no interested bidders had emerged since the published rumors about the transaction had appeared, and the fact that two private equity firms who had been invited to participate in the transaction had declined to do so, having been unwilling to participate in a transaction at the $19.50 per share price level. Further, it considered AMCE's liquidity position, and the ability of AMCE to absorb such expenses if the merger agreement were to be terminated.

        Also at the July 21, 2004 meeting, after members of AMCE's management had been excused from the meeting, the Board of Directors considered the arrangements that had been made with respect to AMCE management and employees in the transaction, including the proposed treatment of outstanding equity awards. It also discussed the arrangements that had been made between J.P. Morgan Partners and Messrs. Brown and Singleton, including the fact that Messrs. Brown and Singleton and other members of AMCE senior management would be invited to roll over AMCE shares and/or re-invest an unspecified portion of their proceeds from the transaction in AMCE at or following the closing. Further, it considered the provisional arrangements that had been made with respect to a post-transaction equity plan for certain members of AMCE senior management.

        At the conclusion of the July 21 meeting, AMCE's Board directed AMCE's management and advisors to continue negotiations with J.P. Morgan Partners in an effort to finalize the terms of the merger agreement.

        After negotiations throughout July 21 between AMCE and the Independent Committee and their respective counsel, on the one hand, and J.P. Morgan Partners and its counsel, on the other hand, the parties reached agreement on AMCE's responsibility with respect to certain costs associated with the escrow financing arrangements, and on the circumstances under which AMCE would bear other expenses of the lenders and J.P. Morgan Partners in the event the merger agreement were to be terminated. AMCE and its advisors concluded that such arrangements effectively limited AMCE's maximum exposure for breakage costs and other expenses to approximately 2.5% of AMCE's equity value in the transaction. J.P. Morgan Partners also reached agreement with Messrs. Brown and Singleton the terms of their arrangements with respect to continued employment and equity participation.

        On the morning of July 22, 2004, the Independent Committee met with its legal and financial advisors. At the invitation of the Independent Committee, representatives of Skadden Arps updated the Independent Committee on the status of the transaction. Skadden Arps also reported to the

53

Independent Committee that a letter that the Independent Committee had requested from Apollo expressing Apollo's current non-binding intent to consent to any alternative transaction offering a higher cash price per share for all shares of AMCE capital stock, if such transaction had, in Apollo's judgment, the same or higher likelihood of consummation as the proposed transaction, which we refer to as the "Apollo letter," had been received by AMCE's board of directors. After the representatives of Skadden Arps excused themselves from the meeting, Lazard delivered to the Independent Committee its oral opinion, subsequently confirmed in a written opinion dated July 22, 2004, that, based upon and subject to the various assumptions made, procedures followed, matters considered and limitations upon the review undertaken as described in the written opinion, the $19.50 per share cash merger consideration is fair, from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or the new company to be formed by the merger, and affiliates of any of the foregoing).

        At the conclusion of the meeting and after receipt of the oral opinion of Lazard, the Independent Committee determined that the merger was in the best interests of the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or the new company to be formed by the merger, and affiliates of any of the foregoing). The Independent Committee approved the merger agreement and the voting agreements and recommended that the Board of Directors approve the merger agreement and that the holders of AMCE common stock (other than Holdings, Marquee, the Apollo Funds, holders of the AMCE Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or AMCE, as the surviving corporation in the merger, and affiliates of any of the foregoing) vote for adoption of the merger agreement.

        Immediately following the Independent Committee's meeting, the Board of Directors of AMCE met to consider the proposed transaction. The members of the Board affiliated with Apollo did not attend the meeting. Representatives of Skadden Arps updated the Board on the results of the negotiations that had taken place since the previous meeting and described the final terms of the merger agreement and related transaction documents, including the final financing commitments. The Board considered the terms of these agreements and discussed the Apollo letter. Goldman Sachs referred again to its earlier financial analysis provided to the Board on July 19, 2004, and rendered to the Board its oral opinion (confirmed by delivery of a written opinion dated July 22, 2004) to the effect that, as of the date of the opinion and based on and subject to the matters stated in such opinion, the $19.50 per share in cash to be received by the holders of AMCE's common stock (other than Holdings, the Apollo Funds, holders of AMCE Class B stock, the members of management who would be given an opportunity to re-invest in AMCE and their affiliates) was fair, from a financial point of view, to such holders. The Independent Committee delivered to the Board its recommendation of the transaction. Following these presentations and after further considering numerous factors, including those set forth below under the caption "Reasons for the Board's Recommendation; Factors Considered," the Board of Directors approved the merger agreement and related agreements, and resolved to recommend that AMCE stockholders vote to adopt the merger agreement.

        Shortly after the meeting, and prior to the opening of trading of AMCE stock on the American Stock Exchange, AMCE, Holdings and Marquee executed the merger agreement and issued a press release announcing the transaction.

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Reasons for the Independent Committee's Recommendation; Factors Considered

        In recommending approval of the merger agreement and the merger to AMCE's Board of Directors on July 22, 2004 (as described above), the Independent Committee considered numerous factors. The material factors, both positive and negative, are summarized below.

        The material positive factors are:

(1)

The merger would provide the holders of AMCE's common stock with cash consideration of $19.50 per share, a price the committee views as attractive in light of AMCE's historical and current financial performance and in light of the fact that AMCE has historically traded at a discount to its peers (which might be due in part to its complex capital structure), that its competitors are well capitalized and the current uncertain economic and market conditions in the U.S. resulting from various macroeconomic factors (including, among other things, the upcoming 2004 elections, the war in Iraq and the future direction of interest rates and inflation). The Independent Committee also considered that $19.50 per share represents a 37.1% premium over the closing stock price on July 19, 2004 (the last unaffected stock price prior to the press reports of a potential transaction), and a 33.7% and 26.9% premium, respectively, over the closing stock price one week and four weeks prior to July 19, 2004. In its consideration of these premiums, the Independent Committee, after discussions with its advisors, did not believe the timing of AMCE's announcement of positive earnings on the same date as announcement of the transaction and its possible effect on the market price of AMCE's common stock to be a material consideration for the following reasons:



•

the fact that, although the announced earnings for the July 1, 2004 quarter indicated a positive trend when compared to AMCE's earnings for the corresponding quarter of its previous fiscal year, such earnings were within the range of analysts' estimates for AMCE's financial performance during the quarter;



•

the fact that such earnings fell short of AMCE's financial plan which had been previously disclosed to the Apollo Investors and the JPMP Investors during the course of the merger discussions, the fact that the JPMP Investors cited such shortfall as a basis for seeking a reduction of their previously proposed $19.50 per share cash merger consideration, and the fact that AMCE's Board and the Independent Committee (and their respective advisors) were only able to dissuade the JPMP Investors from insisting on such a reduction after extensive negotiations;



•

the fact that, despite the positive quarterly results (which nevertheless represented a shortfall to AMCE's financial plan), growth in AMCE's annual earnings—which the Independent Committee believed to be an important factor in determining the long-term market value of AMCE's common stock—would also likely fall short of AMCE's financial plan, especially given AMCE management's expectations that the earnings to be achieved later in the fiscal year might not be as strong as the earnings achieved during the fiscal 2004 Christmas and New Year's holiday season, as the slate of fiscal 2005 holiday theatrical releases was not expected to perform in the aggregate as well as the films released during the comparable period in fiscal 2004.



(2)

Based upon, among other things, the detailed financial and valuation analysis presented to and discussed with the committee by Lazard, the $19.50 per share cash merger consideration provided by the merger agreement:



•

is at the upper end of the range of implied per share valuations of $14.23 to $20.65 for AMCE's common stock based upon trading for companies that Lazard deemed comparable to AMCE;

55

•

is above the range of implied per share valuations of $10.54 to $17.35 for the AMCE's common stock based upon observed premiums paid in merger transactions that Lazard deemed comparable to the proposed merger;



•

is at approximately the middle of the range of implied per share valuations of $16.28 to $23.80 for the common stock based upon a discounted cash flow analysis, and



•

is at the upper end of the range of implied per share valuations of $16.70 to $20.40 for the common stock based upon a leveraged buyout analysis.



(3)

The oral opinion of Lazard, subsequently confirmed in writing on July 22, 2004, that, based upon and subject to the various assumptions made, procedures followed, matters considered and limitations upon the review undertaken, described in the written opinion, the $19.50 per share cash merger consideration provided by the merger agreement is fair, from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing). In its consideration of Lazard's opinion, the Independent Committee was aware that, while the stockholders covered by the opinion consisted solely of unaffiliated stockholders of AMCE, the scope of Lazard's opinion did not address the fairness of the consideration to two groups of stockholders who may or may not be deemed to be unaffiliated stockholders: the Durwood Voting Trust, the sole holder of AMCE's Class B stock—whose interests in the merger negotiations were separately represented—and members of AMCE senior management (other than the Management Investors) who may purchase or be granted equity interests in Holdings prior to or upon consummation of the merger.



(4)

The proposed transaction values AMCE's cash flow generation more highly than the public markets likely would in the near term and possibly over the next 3-5 years, and that premium multiples are currently being paid to companies in AMCE's industry in change of control or sale transactions, including notably a multiple of 7.5x EBITDA for the trailing twelve month period for Loews Cineplex and a multiple of 7.3x EBITDA for the trailing twelve month period for Cinemark.



(5)

The analysis prepared by Lazard setting forth the low, median and high premiums paid in certain transactions (based on the target's closing share price one day, one week and four weeks prior to the announcement of the merger) since 1999 where a financial buyer acquired a U.S. public company for an amount in excess of $250 million indicated that the median premiums for two of the three measures implied a price for AMCE that was below the $19.50 price, whereas the median premiums for one measure implied a price for AMCE that was above the $19.50 price. In comparison to the $19.50 price, had the median premium one day prior to the announcement of the merger been applied to AMCE's stock price on July 16, 2004, the implied price of AMCE would be $18.13. In comparison to the $19.50 price, had the median premium one week prior to the announcement of the merger been applied to AMCE's stock price one week prior to July 16, 2004, the implied price of AMCE would be $18.47. In comparison to the $19.50 price, had the median premium four weeks prior to the announcement of the merger been applied to AMCE's stock price four weeks prior to July 16, 2004, the implied price of AMCE would be $19.79.



(6)

The Independent Committee's understanding that two other prominent private equity firms had separate discussions with J.P. Morgan Partners and Apollo about participating in the equity of Holdings, had separately conducted due diligence and had independently declined to participate, taken together with the Independent Committee's understanding that only large buyers could commit for the amount of equity necessary to consummate a potential

56

transaction and that certain financial sponsors who might otherwise be interested in a potential transaction were already participating in either the recent Cinemark transaction or the pending Loews transaction, which led the Independent Committee to believe that a favorable per share price from J.P. Morgan Partners had been achieved that might not be able to be achieved from another party.

(7)

Apollo had stated that it would be willing to sell all or a portion of its holdings at the $19.50 per share price if J.P. Morgan Partners had offered that option, and had also stated its current intention to sell into an all cash superior proposal that has the same or higher likelihood of consummation as the merger (which intention was confirmed in a letter from Apollo to AMCE dated July 22, 2004).



(8)

Holdings was willing to pay $19.50 per share only if the Apollo Funds participated in the equity of Holdings, and Holdings had earlier indicated that it would pay at least $.50 less per share if the Apollo Funds did not participate in the equity of the surviving company.



(9)

The merger agreement and voting agreements, after giving consideration to the requirements and conditions set forth therein, allow AMCE a reasonable opportunity to respond to certain third party acquisition proposals, and, if a superior proposal were made, to terminate the merger agreement and accept the superior proposal up until the time of the stockholder vote on the merger agreement, subject to certain limitations including the payment of a termination fee (including the escrow "breakage" fees associated with the buyer group's financing arrangements), and Apollo has expressly stated its current non-binding intent to consent to and sell into an all cash superior proposal that has the same or higher likelihood of consummation as the merger, and has sent a letter dated as of July 22, 2004 to the Board of Directors of AMCE to this effect.



(10)

Holders of AMCE's common stock that do not vote in favor of the merger or otherwise waive their appraisal rights will have the opportunity to demand appraisal of the fair value of their shares under Section 262 of the General Corporation Law of the State of Delaware.



(11)

The fact that the expense reimbursement fees and the interest accruing on the amounts borrowed by Holdings and Marquee, which would be payable by AMCE in the event the merger agreement was terminated under certain circumstances, represented in the aggregate approximately 2.5% of the transaction equity value, which was within the range of fees payable in comparable transactions.



(12)

Apollo's statement that it would not consent to the merger (pursuant to the "approval rights" granted pursuant to the Apollo investment agreement) at a price less than $19.50 per share.



(13)

The fact that Apollo will not receive any part of the $10 million expense coverage fee payable under certain circumstances if the merger agreement is terminated.



(14)

That Holdings has received commitments from reputable institutions to provide financing with respect to the merger, subject to the conditions to the obligations of such institutions described under the caption "The Merger—Merger Financing" beginning on page 115.



(15)

The Independent Committee's understanding that AMCE had not been contacted by any potential buyers between the time at which the possibility of a transaction had been announced in the press and the time of the announcement of the transaction.



(16)

The holders of AMCE Class B stock will receive the same form and amount of consideration in the proposed merger as the holders of AMCE common stock.

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        The material negative factors are:

(1)

That the merger will require payment to the holders of AMCE's preferred stock of the change of control distribution, payable in additional shares of AMCE preferred stock, pursuant to the terms of the certificate of designations for the preferred stock, that such payment reduces the merger consideration payable to AMCE's stockholders by $0.74 per share (above the present value of the cash dividends that AMCE could elect at its option to pay in cash until April 19, 2006), and that such distribution would not be payable if a change of control transaction were effected after April 19, 2006. See "Interests of Certain Persons in the Merger—Interests of Apollo in the Merger—Change of Control Distribution Payable in Connection with the Merger" on page 112.



(2)

That AMCE's stockholders, with the exception of the Apollo Investors, the Management Investors and certain other members of AMCE senior management who may purchase or be granted equity interests in Holdings prior to or upon consummation of the merger, will have no ongoing equity participation in AMCE following the merger; such stockholders will cease to participate in AMCE's future earnings or growth, if any, or to benefit from increases, if any, in the value of AMCE's stock owned by them, and will not participate in any future sale of AMCE to a third party.



(3)

That there exist known and possible conflicts of interest of certain of the directors and executive officers of AMCE who will be or will have the opportunity to be equity owners in AMCE following the merger.



(4)

That there was no attempt made to contact other possible purchasers for AMCE (other than the private equity firms invited to participate in the transaction as discussed above) or to conduct a public auction of AMCE (although it was noted that only large buyers could commit for the amount of equity necessary to consummate a potential transaction, there was a limited universe of strategic buyers, certain financial sponsors who might otherwise be interested in a potential transaction in AMCE's industry were already participating in either the recent Cinemark transaction or the pending Loews transaction, no expressions of interest had been received after published rumors about the transaction first appeared, there were certain benefits to negotiating with one potential buyer as a strategy to maximize value on an expedited and confidential basis and the potential adverse impact on AMCE of a broken deal and minimizing the risk of a broken deal).



(5)

That AMCE will be responsible for all interest accruing on the amounts borrowed by the buyer group to finance the transaction starting at the time such amounts are placed into escrow, and the fact that, in addition to such interest (which is not expected to exceed $25.2 million in the aggregate), AMCE will be responsible for payment to J.P. Morgan Partners of an expense coverage fee of $10 million (although it was noted that Apollo would not receive any part of the expense coverage fee) and payment of certain expenses (up to $11.25 million) associated with the buyer group's financing arrangements if the merger agreement is terminated under certain circumstances.



(6)

That the merger is not subject to the approval by a separate vote of the holders of AMCE's common stock not affiliated with Apollo, Holdings and Marquee. The Independent Committee believes the merger is procedurally fair to the unaffiliated stockholders despite this because the Independent Committee was established to and did review and evaluate the merger on behalf of AMCE's unaffiliated stockholders.



(7)

That the cash consideration to be received by the holders of AMCE's stock will be taxable to them. The Independent Committee was not knowledgeable of, and did not consider, the tax effects of the transaction on Apollo or on any other affiliated stockholders (including

58

members of AMCE management) who will have an opportunity to own an equity interest in Holdings following the merger.

(8)

The fact that the AMCE Board of Directors did not retain any additional unaffiliated representative to act on behalf of the unaffiliated AMCE stockholders; in this regard, the Independent Committee believed that the retention of such an additional representative was not necessary, because the Independent Committee was charged with representing such unaffiliated stockholders and it was actively involved in the extended and numerous deliberations regarding the merger on behalf of the unaffiliated stockholders.

        The foregoing discussion of the information and factors considered by the Independent Committee is not intended to be exhaustive, but includes the material factors considered by the Independent Committee. In view of the variety of factors considered in connection with its evaluation of the merger, the Independent Committee did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific factors considered in reaching its determination and recommendation. In addition, individual directors may have given differing weights to different factors. On balance, the Independent Committee believed that the positive factors discussed above outweighed the negative factors discussed above.

        The Independent Committee also believes the process it followed in recommending the approval of the merger agreement was fair because:

(1)

The Independent Committee consists entirely of directors who are not AMCE officers or controlling shareholders or affiliated with any controlling shareholders or J.P. Morgan Partners.



(2)

The members of the Independent Committee will not personally benefit from the consummation of the merger in a manner different from the unaffiliated stockholders.



(3)

The Independent Committee retained and was advised by independent legal counsel.



(4)

The Independent Committee retained and was advised by Lazard, an independent investment banker, which assisted the committee in its evaluation of the fairness of the $19.50 per share cash merger consideration to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or the new company formed by the merger, and affiliates of any of the foregoing).



(5)

J.P. Morgan Partners had requested an exclusivity period prior to the execution of the Merger Agreement during which time AMCE could not entertain or solicit offers from other third parties, and AMCE declined to agree to such an exclusivity period. Other private equity firms had expressed an interest in investing in the industry, but the Board of Directors determined that AMCE and its stockholders were better served pursuing the proposed transaction with J.P. Morgan Partners.



(6)

The merger agreement and voting agreements, after giving consideration to the requirements and conditions set forth therein, allow AMCE a reasonable opportunity to respond to certain third party acquisition proposals, and, if a superior proposal were made, to terminate the merger agreement and accept the superior proposal up until the time of the stockholder vote on the merger agreement, subject to certain limitations including the payment of an expense coverage fee and the payment by the Company of expenses associated with Holdings' financing arrangements, and that Apollo has expressly stated its current non-binding intent to consent to and sell into an all cash superior proposal that in its judgment has the same or higher likelihood of consummation as the merger, and has sent a letter dated as of July 22, 2004 to AMCE to this effect.

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(7)

That the obligation of Apollo and the Durwood Voting Trust to vote in favor of the merger agreement will terminate upon the Independent Committee or AMCE's Board having withdrawn, qualified or modified its recommendation of the merger, or having approved or recommended a superior proposal, and upon any termination of the merger agreement in accordance with its terms, including any termination in order to accept a superior proposal.



(8)

The fact that the Independent Committee was involved in extensive and numerous deliberations regarding the merger, was kept informed of the status of negotiations, consistently relayed to AMCE and its advisors its positions with respect to the price and terms, and had authority to recommend against the merger.



(9)

The fact that, while the scope of Lazard's opinion did not address the fairness of the consideration to the holders of AMCE Class B stock, the Durwood Voting Trust—the sole holder of shares of AMCE Class B stock—was separately represented in the negotiations of the proposed merger by independent legal counsel.

Reasons for the Board's Recommendation; Factors Considered

        In approving the merger agreement and related agreements, and recommending that AMCE's stockholders vote for the adoption of the merger agreement, the Board of Directors of AMCE considered a number of factors, including the following material factors:

(1)

The determination and recommendation of the Independent Committee, and the factors considered by the Independent Committee, as described under the caption "—Reasons for the Independent Committee's Recommendation; Factors Considered" above.



(2)

The financial condition, results of operations, competitive position, business and prospects of AMCE, the current uncertain economic and market conditions in the U.S. resulting from various macroeconomic factors (including among other things, the upcoming 2004 elections, the war in Iraq and the future direction of interest rates and inflation) and the nature of the theatrical exhibition industry. In this regard, the Board considered:



•

the fact that AMCE had a large amount of cash on hand (approximately $399.0 million as of July 1, 2004), earning a low return—excess cash is typically invested by AMCE in short-term investments recently yielding annualized returns below 2%—and otherwise not being utilized to maximize value for AMCE's stockholders;



•

the fact that publicly traded theatre stocks were trading near their 52-week highs, and the Board's belief that it would be an opportune time to realize a premium above these high stock price levels as the month prior to announcement of the transaction had seen the market price for such stocks decline;



•

the fact that AMCE trades at a discount to its peers (calculated on the basis of the ratio of its stock price to its trailing twelve-month EBITDA) in the public equity markets, as its peers had averaged ratios 1.0 - 2.0 higher than AMCE during the most recent 12 month period; and



•

the lack of attractive near-term acquisition targets or strategic partners for AMCE, and the Board's belief that AMCE was unlikely to realize continued significant growth in its stock price in the absence of an extraordinary transaction outside AMCE's ordinary course of business.

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(3)

The fact that the $19.50 in cash to be received by AMCE's stockholders in the merger represents:



•

a premium of approximately 37.1% over the closing price of shares of AMCE common stock on the day before the appearance of news stories discussing the transaction;



•

a premium of approximately 27.5% over the average closing price of shares of AMCE common stock over a three month period;



•

a premium of approximately 28.2% over the average closing price of shares of AMCE common stock over a six month period;



•

a premium of approximately 35.8% over the average closing price of shares of AMCE common stock over a one year period; and



•

a premium of approximately 63.9% over the average closing price of shares of AMCE common stock over a three year period.






In its consideration of the premiums described above, the Board, after discussions with its advisors, did not believe the timing of AMCE's announcement of positive earnings on the same date as announcement of the transaction and its possible effect on the market price of AMCE's common stock to be a material consideration for the following reasons:



•

the fact that, although the announced earnings for the July 1, 2004 quarter indicated a positive trend when compared to AMCE's earnings for the corresponding quarter of its previous fiscal year, such earnings were within the range of analysts' estimates for AMCE's financial performance during the quarter;



•

the fact that such earnings fell short of AMCE's financial plan which had been previously disclosed to the Apollo Investors and the JPMP Investors during the course of the merger

discussions, the fact that the JPMP Investors cited such shortfall as a basis for seeking a reduction of their previously proposed $19.50 per share cash merger consideration, and the fact that AMCE's Board and the Independent Committee (and their respective advisors) were only able to dissuade the JPMP Investors from insisting on such a reduction after extensive negotiations;

•

the fact that, despite the positive quarterly results (which nevertheless represented a shortfall to AMCE's financial plan), growth in AMCE's annual earnings—which the AMCE Board believed to be an important factor in determining the long-term market value of AMCE's common stock—would also likely fall short of AMCE's financial plan, especially given AMCE management's expectations that the earnings to be achieved later in the fiscal year might not be as strong as the earnings achieved during the fiscal 2004 Christmas and New Year's holiday season, as the slate of fiscal 2005 holiday theatrical releases was not expected to perform in the aggregate as well as the films released during the comparable period in fiscal 2004.



(4)

The fact that the merger consideration will be all cash, which provides certainty of value to AMCE's stockholders.



(5)

The fact that the consideration and other terms of the merger agreement resulted from negotiations between AMCE and J.P. Morgan Partners, and the Board's belief that $19.50 per share in cash for each share of AMCE common stock represented the highest per share consideration that could be negotiated.



(6)

The financial presentation of Goldman Sachs, including the oral opinion of Goldman Sachs (confirmed by delivery of a written opinion dated July 22, 2004) to the effect that, as of the date of the opinion and based on and subject to the matters stated in the opinion, the

61

consideration to be received by the holders of AMCE common stock (other than Holdings, the Apollo Funds, holders of AMCE Class B stock, members of AMCE management who have the option to participate in Holdings and their affiliates), is fair from a financial point of view to those holders. In its consideration of Goldman Sachs' opinion, the Board was aware that, while the stockholders covered by the opinion consisted solely of unaffiliated stockholders of AMCE, the scope of Goldman Sachs' opinion did not address the fairness of the consideration to two groups of stockholders who may or may not be deemed to be unaffiliated stockholders: the Durwood Voting Trust, the sole holder of AMCE's Class B stock—whose interests in the merger negotiations were separately represented—and members of AMCE senior management (other than the Management Investors) who may purchase or be granted equity interests in Holdings prior to or upon consummation of the merger. Further, in considering the presentation and opinion of Goldman Sachs, the Board was aware of Goldman Sachs' past and current relationships with AMCE and its affiliates (including Apollo), and the compensation to be received by Goldman Sachs upon consummation of the transaction, but did not believe that these factors impacted Goldman Sachs' analysis or influenced its conclusions. The opinion of Goldman Sachs, these relationships and its compensation arrangements are more fully described below under the caption "Opinion of Goldman Sachs."

(7)

AMCE's complex capital structure, and the Board's belief, based in part on observations made by AMCE's financial advisors, that such complexity likely explained part of the discount at which AMCE has traded to its peers in the public equity markets. The Board also considered the difficulties that AMCE's capital structure had presented when AMCE had explored other strategic opportunities in the past.



(8)

The terms of the merger agreement, including the ability of AMCE to consider competing proposals. The Board considered that the merger agreement permits AMCE to furnish information to, and enter into discussions with, third parties in response to unsolicited written proposals regarding a competing transaction if the Board of Directors or the Independent Committee determines in good faith, after consultation with outside legal counsel, that the failure to take any such action would be inconsistent with its fiduciary duties to AMCE's stockholders under applicable law. See "The Merger Agreement—Covenants of AMCE—No Solicitation of Other Offers" for additional information regarding the ability of AMCE to consider competing proposals.



(9)

The other terms of the merger agreement regarding competing proposals, including the ability of AMCE to terminate the merger agreement and accept a financially superior proposal under specified conditions, subject to the payment to Holdings of an expense reimbursement fee of $10 million, the payment of up to $11.25 million of expenses associated with the buyer group's financing arrangements and the payment by AMCE of interest accrued on the amounts borrowed by the buyer group to finance the transaction (which are not expected to exceed $25.2 million). See "The Merger Agreement—No Solicitation of Other Offers" for additional information regarding the ability of AMCE to consider competing proposals and "The Merger Agreement—Expense Reimbursement" and "The Merger Agreement—Interest Payments Pursuant to Letters of Credit" for a description of the expenses for which AMCE is responsible.



(10)

The fact that AMCE and its advisors did not actively solicit indications of interest from other parties who might be interested in engaging in a transaction with AMCE prior to execution of the merger agreement. In this regard, the Board considered, among other factors:



•

the fact that Cinemark and Loews Cineplex had both recently completed lengthy auction processes, which had helped AMCE's financial advisors identify the parties who were most

62

likely interested in investing in the theatrical exhibition industry or engaging in a transaction with AMCE;

•

the fact that the recently announced acquisitions of Cinemark and Loews Cineplex involved multiple investors acting together in buyer groups, which, in the views of the Board and AMCE's financial advisors, resulted in a smaller number of parties who would likely still be interested in making an investment in the theatrical exhibition industry or engaging in a transaction with AMCE;



•

the possibility that potentially interested buyers might need to jointly fund the required equity with others, and the possibility that collaboration among potential bidders might adversely impact the price AMCE could obtain in an auction;



•

the Board's belief, based in part on the three factors set forth immediately above, that it might be able to achieve a higher value in a negotiated transaction with J.P. Morgan Partners rather than through an auction process;



•

the Board's unwillingness to support a transaction which might involve significant delays to consummation, or risk of non-consummation;



•

the views of the Board that an auction process or active solicitations of interest in AMCE might be disruptive to AMCE's business and its employees, and might result in leaks of material, non-public information;



•

the views of the Board that the failure to engage in a transaction after an active sale process was conducted might cause the markets to have a negative view of AMCE, especially after AMCE had previously publicly announced that it was unable to reach agreement with Loews Cineplex;



•

the fact that two private equity firms who had been invited by J.P. Morgan Partners prior to the execution of the merger agreement to participate in the transaction had declined to participate, which the Board viewed as an indication that it had achieved a favorable per share price from J.P. Morgan Partners that it might not be able to achieve from another party;



•

the fact that the Board had not received any expressions of interest from any third party after published rumors had appeared about a transaction between AMCE and J.P. Morgan Partners;



•

the fact that the Board had received an expression of interest from Cinemark in engaging in a transaction with AMCE and the Board had declined to pursue such indication of interest; and



•

the risk that AMCE pursuing other indications of interest might cause J.P. Morgan Partners to terminate its discussions with AMCE.



(11)

The terms of the merger agreement providing that AMCE will be responsible for all interest accruing on the amounts borrowed by the buyer group to finance the transaction, starting from the time such amounts are placed into escrow. In this regard, the Board considered:



•

the fact that both J.P. Morgan Partners and Apollo had indicated that their ability to engage in a transaction at a price of $19.50 per share was contingent upon securing funds on the favorable terms then available in the financing markets, and depositing the proceeds into escrow pending satisfaction of the other condition to the merger;



•

the fact that both J.P. Morgan Partners and Apollo had stated that they were unwilling to proceed with the transaction unless AMCE would commit to pay such amounts;

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•

the amount of the interest expense in question (which is not expected to exceed $25.2 million in the aggregate);



•

the fact that, if the merger agreement is terminated, AMCE will still be responsible for the payment of such interest, regardless of the reason for such termination; and



•

the potential impact that payment of such amounts (including together with the amounts described in clause (12) below) might have on a third party wishing to make a competing proposal for AMCE.



(12)

The terms of the merger agreement providing that AMCE will be responsible for (i) payment to Holdings of an expense coverage fee of $10 million and (ii) payment of certain expenses (up to an aggregate of $11.25 million) associated with J.P. Morgan Partners' and Apollo's financing arrangements, in each case if the merger agreement is terminated under specified circumstances, including if the merger agreement is terminated to accept a superior proposal. The Board noted that these amounts were in addition to the interest expenses for which AMCE would also be responsible (see clause (11) above), and also considered the potential discouraging impact that payment of such amounts (including together with the amounts described in clause (11)) might have on a third party wishing to make a competing proposal for AMCE.



(13)

The fact that, since the onset of negotiations with AMCE, J.P. Morgan Partners had taken the position that it was unwilling to enter into a transaction with AMCE unless Apollo and the Durwood Voting Trust were contractually committed to supporting the transaction. The Board considered the impact that such arrangements might have on third parties interested in making a competing proposal for AMCE. The Board also considered the terms of the voting agreements entered into by each of Apollo and the Durwood Voting Trust, including:



•

the agreement of Apollo to consent to the transaction, and the agreements of Apollo and the Durwood Voting Trust to vote their shares in favor of adoption of the merger agreement;



•

the fact that the voting agreements terminate if either AMCE's Board or the Independent Committee changes its recommendation of the transaction, or if the merger agreement is terminated (including being terminated by AMCE to accept a competing proposal).



•

the fact that both Apollo and the Durwood Trust did not accept proposed terms which would have provided that, if the AMCE Board were to elect to pursue a superior proposal, the voting agreements would have automatically bound Apollo and the Durwood Trust to support such superior transaction, although both Apollo and the Durwood Trust had indicated that they would be amenable to discussing their support of such transactions were they to arise.






See the section entitled "The Voting Agreements" for a more complete description of the terms of the Apollo and Durwood Trust voting agreements.



(14)

The fact that Apollo, by virtue of the terms of its pre-existing investment in AMCE, possesses "approval rights" with respect to certain actions proposed to be taken by AMCE, including the right to approve any merger, consolidation or similar transaction involving AMCE (including the merger). In this regard, the Board considered a number of factors, including:



•

Apollo's agreement to consent to the merger and the transactions contemplated by the merger agreement, including in light of the interests of Apollo described under the caption "Interests of Certain Persons in the Merger";



•

the terms of Apollo's voting agreement; and

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•

the letter delivered by Apollo to AMCE's Board of Directors, indicating Apollo's current non-binding intention to support alternative transactions meeting specified criteria.



(15)

The fact that the transactions contemplated by the merger agreement will constitute a "change of control" for purposes of AMCE's Series A convertible preferred stock and result in the payment of a special distribution of shares of such stock to the holders thereof. In this regard, the Board considered:



•

the number of shares issuable as a result of the distribution and the value thereof, and the fact that the distribution will result in dilution to the holders of AMCE's common stock;



•

the timing of the transaction, and the fact that the number of shares payable as a result of the distribution would decrease each quarter through April 2006, after which time no such distribution would be payable if a "change of control" transaction took place, and the possibility that at such later date an opportunity such as the one presented by the merger might not exist; and



•

the fact that the Apollo Investors, which will continue to own a significant equity stake in AMCE following the merger, will receive (on an as-converted basis) approximately 4.4 million shares of common stock as a result of the change of control distribution (with an aggregate value at the merger price in excess of $85 million), as opposed to cash dividends payable through April 19, 2006 with a value of approximately $30.1 million



(16)

The potential conflicts of interest between AMCE, on the one hand, and Apollo, on the other hand, including:



•

the fact that Apollo will be re-investing a significant portion of the proceeds it receives in the transaction, and will own approximately 49.9% of Holdings immediately following the transaction, and the impact such an arrangement might have on a third party which was considering making a competing proposal;



•

the fact that the Apollo will be receiving a large number of shares of common stock as a result of the change of control distribution (see clause (15) above);



•

the fact that Apollo will receive a portion of the $20 million "sponsor fee" payable upon consummation of the transaction.






See sections entitled "Background of the Merger" and "Interests of Certain Persons in the Merger" for a description of these potential conflicts of interest.



(17)

The potential conflicts of interest between AMCE on the one hand, and, on the other hand, certain members of AMCE's management, including Messrs. Brown and Singleton, who will be given an opportunity to invest in Holdings upon or following consummation of the transaction. See sections entitled "—Background of the Merger" and "Interests of Certain Persons in the Merger" for a description of these potential conflicts of interest.



(18)

The procedural safeguards that have been put in place to ensure the fairness of the transactions to AMCE's common stockholders, including the formation of the Independent Committee. In this regard, while the AMCE Board noted that the Independent Committee was not the sole negotiator of the terms of the transaction with J.P. Morgan Partners, it considered the fact that Mr. Egan, a member of AMCE's Board of Directors, who is not affiliated with J.P. Morgan Partners or Apollo and who will not personally benefit from the consummation of the merger in a manner different from the unaffiliated stockholders, was appointed to oversee negotiations on behalf of AMCE.



(19)

The likelihood of consummation of the merger, including the financing condition to the merger. The Board considered the size and reputation of J.P. Morgan Partners and the third

65

party financing commitments that were in place in concluding that the financing condition could be satisfied. It also considered the fact that J.P. Morgan Partners and Apollo intended to access the financial markets shortly after announcement of the transaction, and noted the additional certainty that would be achieved by securing the necessary funds within 20 days after announcement of the transaction.

(20)

The fact that holders of AMCE's common stock that do not vote in favor of the merger or otherwise waive their rights of appraisal will have the opportunity to demand an appraisal of the fair value of their shares under Section 262 of the General Corporation Law of the State of Delaware, or DGCL.



(21)

The fact that, following the merger, AMCE's stockholders (other than the Apollo Investors and the members of AMCE management who reinvest in AMCE) will cease to participate in any future growth of AMCE or benefit from any increase in its value.



(22)

The fact that the cash consideration to be received by the holders of AMCE's stock will be taxable to them. The Board was not knowledgeable of, and did not consider, the tax effects of the transaction on Apollo or on any other affiliated stockholders (including members of AMCE management) who will have an opportunity to own an equity interest in Holdings following the merger;



(23)

The fact that, while the scope of Goldman Sachs' opinion did not address the fairness of the consideration to the holders of AMCE Class B stock, the Durwood Voting Trust—the sole holder of shares of AMCE Class B stock—was separately represented in the negotiation of the proposed merger and would receive the same form and per share amount of consideration in the proposed merger as the holders of AMCE common stock.

        The foregoing discussion of the information and factors considered by AMCE's Board of Directors is not intended to be exhaustive, but includes the material factors considered by the Board of Directors. In view of the variety of factors considered in connection with its evaluation of the merger, AMCE's Board did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific factors considered in reaching its determination and recommendation. In addition, individual directors may have given differing weights to different factors.

        AMCE's Board of Directors considered all of these factors in reaching the conclusions and recommendations described above. These factors generally figured positively, as advantages or opportunities, with the following exceptions:

•

the factor described in clause (10), which figured negatively, but which the Board felt was outweighed by the other factors, including the factors described in clauses (8) and (9) above, and the countervailing considerations discussed within clause (10) above;



•

the factors described in clauses (11) and (12), which figured negatively, but which the Board felt were outweighed by the other factors, including the countervailing considerations discussed within clause (11) above;



•

the factor described in clause (14) above, which the Board considered neutral in its evaluation;



•

the factors considered in clauses (15), (21) and (22) above, which figured negatively, but one which AMCE Board felt was outweighed by the other factors, including the factors described in clauses (2) through (6);



•

the factors described in clauses (16) and (17) above, which figured negatively as risks, but risks which the Board believed could be managed successfully, including through the factor described in clause (18).

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Recommendations of the Independent Committee and the Board of Directors; Fairness of the Merger

The Independent Committee

        Our Board of Directors established an Independent Committee consisting of two of our disinterested and independent directors, Messrs. Charles S. Sosland and Paul E. Vardeman to review, evaluate and make recommendations to the Board of Directors, on behalf of the stockholders of AMCE (other than the Apollo Funds and the Durwood Voting Trust), with respect to certain possible transactions, including transactions involving the recapitalization of AMCE and transactions involving the sale of all or a portion of the capital stock of AMCE to a third party. The Independent Committee received independent legal and financial advice and conducted a vigorous evaluation of, and participated in negotiations with respect to, the merger agreement and the various other agreements related to the merger.

        The Independent Committee, by unanimous vote at a meeting held on July 22, 2004, determined that the merger agreement and the transactions contemplated by the merger agreement, are advisable, substantively and precedurally fair to, and in the best interests of, AMCE and the unaffiliated AMCE stockholders.

        The Independent Committee, also at the July 22, 2004, meeting, recommended that (1) our Board of Directors adopt and approve the merger agreement and the transactions contemplated by the merger agreement and (2) the holders of AMCE common stock (other than Holdings, Marquee, Apollo, holders of the AMCE Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or AMCE, as the surviving corporation in the merger, and affiliates of any of the foregoing) vote in favor of adoption of the merger agreement. In reaching its determination, the Independent Committee consulted with management, as well as the Independent Committee's financial and legal advisors, and considered the short-term and long-term interests and prospects of the AMCE stockholders on whose behalf it made its determination and recommendation. Along with the other factors described in more detail in the section entitled "Reasons for the Independent Committee's Recommendation; Factors Considered," the Independent Committee also considered the fairness opinion presented to the Independent Committee by Lazard. See the section entitled "—Opinion of Lazard" for a discussion of Lazard's fairness opinion.

        The Independent Committee believes that the merger is procedurally fair despite the fact that the terms of the merger agreement do not specifically require the approval of at least a majority of the unaffiliated security holders of AMCE (as such term is defined in Rule 13e-3 under the Exchange Act) and the fact that AMCE's Board of Directors did not retain an unaffiliated representative, other than the Independent Committee, to act solely on behalf of the unaffiliated AMCE stockholders for purposes of negotiating the terms of the merger agreement. In this regard, the Independent Committee believes that it was not necessary for AMCE's Board of Directors to retain any additional unaffiliated representative to act on behalf of the unaffiliated AMCE stockholders because the Independent Committee was charged with representing such unaffiliated stockholders and it was actively involved in the extended and numerous deliberations regarding the merger on behalf of the unaffiliated stockholders. In making its fairness determination, the Independent Committee did not assign specific relative weights to the factors which it considered.

        The Independent Committee did not consider net book value in determining the fairness of the merger to unaffiliated AMCE stockholders because of its belief, after consultation with its financial advisors, that net book value, which is an accounting concept, does not reflect, or have any meaningful impact on, the market trading prices for the AMCE common stock. The Independent Committee notes, however, that the merger consideration of $19.50 per share of AMCE common stock is higher than the book value of the AMCE common stock. The Independent Committee did not consider liquidation value in determining the fairness of the merger to unaffiliated AMCE stockholders because of its belief that liquidation value did not present a meaningful valuation for AMCE and its business; rather, it was

67

the belief of the Independent Committee that AMCE's value is derived from the cash flows generated from its continuing operations, rather than from the value of its assets that might be realized in a liquidation. Further, because AMCE's assets include a significant amount of intangible assets, intellectual property, rented properties and other assets that are not readily transferable or are subject to restrictions on their transfer in a liquidation scenario, the Independent Committee concluded that AMCE is not susceptible to a meaningful liquidation valuation. Moreover, it was the Independent Committee's belief that a large part of AMCE's success is attributable to its market share and market presence as a chain of numerous individual properties unified by a recognizable brand name and reputation for quality, and any liquidation of its assets or break-up or piecemeal sale of its parts would not maximize stockholder value because it would not likely compensate AMCE's stockholders for the value inherent in AMCE's market position or brand identity. Therefore, the Independent Committee believed that the liquidation methodology would result in a lower valuation for AMCE than had been proposed in the merger negotiations.

        The Independent Committee considered the valuation analyses presented by Lazard, some of which represented the sale of AMCE as a continuing business and some of which represented AMCE remaining as a stand-alone entity. While the Independent Committee did not believe that there is a single method for determining "going concern value," the Independent Committee believed that each of Lazard's valuation methodologies represented a valuation of AMCE as it continues to operate its business, and, to that extent, such analyses could be collectively characterized as forms of going concern valuations. For example, the Independent Committee considered the comparable companies analysis, which could be considered to represent the "stand alone" valuation of AMCE if it traded at the multiples calculated for the comparable companies. In addition, the discounted cash flow analysis could be considered a "stand-alone" valuation of AMCE based on the present value of the estimated future unlevered free cash flows and present value of the terminal value of AMCE in 2008 and the present value of the tax benefit of AMCE's net operating losses. The Independent Committee considered these analyses in the context of the other valuation analyses performed by Lazard in the preparation of its opinion, and, in that regard, such analyses factored into the Independent Committee's conclusions as to the fairness of the merger to the unaffiliated stockholders.

Our Board of Directors

        Our Board of Directors consists of eight directors, four of whom, Messrs. Black, Rowan, Berg and Brown, have interests in the merger different from the interests of our unaffiliated shareholders generally. On July 22, 2004, our Board of Directors, with Messrs. Black, Rowan and Berg abstaining and not participating, approved and adopted the merger agreement, determined to submit it to our stockholders to vote upon its adoption and recommended that our stockholders vote in favor of the adoption of the merger agreement. Messrs. Black, Rowan and Berg chose to abstain and not to participate in the meeting due to their affiliation with Apollo, which has interests in the merger that are different from those of the unaffiliated stockholders generally. See the sections entitled "—Interests of Apollo in the Merger "for additional information on Apollo's interests in the merger. Mr. Brown, who it is anticipated will acquire an equity interest in Holdings and continue as an executive officer of AMCE following completion of the merger, participated in the Board of Directors' vote.

        On the basis of the Independent Committee's recommendation, our Board of Directors (1) determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, substantively and procedurally fair to and in the best interests of AMCE and the unaffiliated AMCE stockholders, and (2) recommended that our stockholders adopt the merger agreement.

        In reaching its determination, our Board of Directors consulted with AMCE management, as well as its financial and legal advisors, and considered the short-term and long-term interests and prospects of AMCE's unaffiliated stockholders. Along with the factors described in more detail above, the Board

68

of Directors considered the opinion as to fairness presented by Goldman. See the sections entitled "—Background of the Merger" for additional information on the Board of Director's recommendations and "—Opinion of Goldman Sachs" for a discussion of Goldman Sachs' opinion.

        Our Board of Directors believes that the merger is procedurally fair despite the fact that the terms of the merger agreement do not specifically require the approval of at least a majority of the unaffiliated security holders of AMCE (as such term is defined in Rule 13e-3 under the Exchange Act) and that the Company did not retain an unaffiliated representative, other than the Independent Committee, to act solely on behalf of the unaffiliated AMCE stockholders for purposes of negotiating the terms of the merger agreement. In this regard, our Board of Directors believes it was not necessary to retain any additional unaffiliated representative to act on behalf of the unaffiliated security holders of AMCE in light of the fact that the use of a special committee of independent directors is a mechanism well recognized to ensure fairness of the transactions of this type. In making its fairness determination, our Board of Directors did not assign specific relative weights to the factors which it considered.

        Our Board of Directors did not consider net book value in determining the fairness of the merger to unaffiliated AMCE stockholders because of its belief, after consultation with its financial advisors, that net book value, which is an accounting concept, does not reflect, or have any meaningful impact on, the market trading prices for the AMCE common stock. Our Board of Directors notes, however, that the merger consideration of $19.50 per share of AMCE common stock is higher than the book value of the AMCE common stock. Our Board of Directors did not consider liquidation value in determining the fairness of the merger to unaffiliated AMCE stockholders because of its belief, after consultation with its financial advisors, that liquidation value did not present a meaningful valuation for AMCE and its business; rather, it was the belief of our Board of Directors that AMCE's value is derived from the cash flows generated from its continuing operations, rather than from the value of its assets that might be realized in a liquidation. Further, because AMCE's assets include a significant amount of intangible assets, intellectual property, rented properties and other assets that are not readily transferable or are subject to restrictions on their transfer in a liquidation scenario, our Board of Directors concluded that AMCE is not susceptible to a meaningful liquidation valuation. Moreover, it was our Board of Directors' belief that a large part of AMCE's success is attributable to its market share and market presence as a chain of numerous individual properties unified by a recognizable brand name and reputation for quality, and any liquidation of its assets or break-up or piecemeal sale of its parts would not maximize stockholder value because it would not likely compensate AMCE's stockholders for the value inherent in AMCE's market position or brand identity. Therefore, our Board of Directors believed that the liquidation methodology would result in a lower valuation for AMCE than had been proposed in the merger negotiations.

        The AMCE Board considered the valuation analyses presented by Goldman Sachs, some of which represented the sale of AMCE as a continuing business and some of which represented AMCE remaining as a stand-alone entity. While the Board did not believe that there is a single method for determining "going concern value," the Board believed that each of Goldman Sachs' valuation methodologies represented a valuation of AMCE as it continues to operate its business, and, to that extent, such analyses could be collectively characterized as forms of going concern valuations. For example, the Board considered the comparable companies analysis, which could be considered to represent the "stand alone" valuation of AMCE if it traded at the multiples calculated for the comparable companies. In addition, the discounted cash flow analysis could be considered a "stand-alone" valuation of AMCE based on the present value of the estimated future unlevered free cash flows and present value of the terminal value of AMCE in 2009. The Board considered these analyses in the context of the other valuation analyses performed by Goldman Sachs in the preparation of its opinion, and, in that regard, such analyses factored into the Board's conclusions as to the fairness of the merger to the unaffiliated stockholders.

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Position of Apollo and the Apollo Investors as to the Fairness of the Merger

        Under the rules governing "going private" transactions, Apollo and the Apollo Investors are required to express their beliefs as to the substantive and procedural fairness of the merger to unaffiliated AMCE stockholders. Each of Apollo and the Apollo Investors is making the statements included in this sub-section solely for the purposes of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. Each of Apollo and the Apollo Investors believes that the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders on the basis of the factors described below.

        Neither Apollo nor the Apollo Investors participated in the deliberations of AMCE's Board of Directors regarding, or received advice from AMCE's legal or financial advisors as to, the fairness of the merger to the unaffiliated AMCE stockholders.

        Each of Apollo and the Apollo Investors believes the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders on the basis of the factors described below. However, neither Apollo nor the Apollo Investors performed, or engaged a financial advisor to perform, any valuation or other analysis for the purposes of assessing the fairness of the merger to the unaffiliated AMCE stockholders.

        In making their determination that the merger was substantively and procedurally fair to the unaffiliated AMCE stockholders, Apollo and the Apollo Investors considered the following material positive factors:

•

The fact that the $19.50 in cash to be received by AMCE's stockholders in the merger represents:



•

a premium of approximately 37.1% over the closing price of shares of AMCE common stock on the day before the appearance of news stories discussing the transaction;



•

a premium of approximately 27.5% over the average closing price of shares of AMCE common stock over a three month period;



•

a premium of approximately 28.2% over the average closing price of shares of AMCE common stock over a six month period;



•

a premium of approximately 35.8% over the average closing price of shares of AMCE common stock over a one year period; and



•

a premium of approximately 63.9% over the average closing price of shares of AMCE common stock over a three year period.



•

Holders of AMCE's common stock that do not vote in favor of the merger or otherwise waive their appraisal rights will have the opportunity to demand appraisal of the fair value of their shares under Section 262 of the General Corporation Law of the State of Delaware.



•

That the merger will provide consideration to AMCE's shareholders entirely in cash.



•

The nature of the financing commitments received by Holdings with respect to the merger agreement, including the identity of the institutions providing such commitments and the conditions to the obligations of such institutions to fund such commitments.



•

That each of the Independent Committee and our Board of Directors determined, by the unanimous vote of all directors voting on the matter, that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to and in the best interests of AMCE and its stockholders.

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•

That the Independent Committee received the opinion of Lazard, dated July 22, 2004, to the effect that, as of that date and based upon and subject to the various assumptions made, procedures followed, matters considered and limitations upon the review undertaken as described in its opinion, the $19.50 per share cash merger consideration provided by the merger agreement was fair, from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing).



•

That our Board of Directors received the opinion of Goldman Sachs, dated July 22, 2004, to the effect that, as of that date and based upon and subject to the factors and assumptions set forth in its opinion, the $19.50 per share in cash to be received by the holders (other than Holdings, the Apollo Funds, members of AMCE management who have the option to participate in Holdings, the holders of AMCE Class B stock, and their affiliates) of the outstanding shares of AMCE common stock pursuant to the merger agreement was fair from a financial point of view to those holders.

        Apollo and the Apollo Investors also considered the following material negative factors:

•

That AMCE's stockholders, with the exception of the Apollo Investors and most likely certain members of AMCE's management, will have no ongoing equity participation in AMCE following the merger; such stockholders will cease to participate in AMCE's future earnings or growth, if any, or to benefit from increases, if any, in the value of AMCE's stock owned by them, and will not participate in any future sale of AMCE to a third party.



•

That there exist known and possible conflicts of interest of certain of the directors and executive officers of AMCE who will be or will have the opportunity to be equity owners in AMCE following the merger.



•

That there was no attempt made to contact other possible purchasers for AMCE (other than the private equity firms invited to participate in the transaction as discussed above) or to conduct a public auction of AMCE (although it was noted that only large buyers could commit for the amount of equity necessary to consummate a potential transaction, there was a limited universe of strategic buyers, certain financial sponsors who might otherwise be interested in a potential transaction in AMCE's industry were already participating in either the recent Cinemark transaction or the pending Loews Cineplex transaction, no expressions of interest had been received after published rumors about the transaction first appeared, there were certain benefits to negotiating with one potential buyer as a strategy to maximize value on an expedited and confidential basis and the potential adverse impact on AMCE of a broken deal and minimizing the risk of a broken deal).



•

That AMCE will be responsible for all interest accruing on the amounts borrowed by the buyer group to finance the transaction starting at the time such amounts are placed into escrow, and the fact that, in addition to such amounts, AMCE will be responsible for payment to J.P. Morgan Partners of an expense coverage fee of $10 million (although it was noted that Apollo would not receive any part of the expense coverage fee) and payment of certain expenses (up to $11.25 million) associated with the buyer group's financing arrangements if the merger agreement is terminated under certain circumstances.



•

That the cash consideration to be received by the holders of AMCE's stock will be taxable to them.

71

•

That Goldman Sachs has past and current relationships with AMCE and its affiliates (including Apollo); however, Apollo did not rely on the opinion of Goldman Sachs in making its determination as to fairness;



•

That AMCE has historically traded at lower multiples (calculated on the basis of the ratio of its stock price to its twelve-month trailing EBITDA) than its peer group, which could be due to the complex capital structure of AMCE.

        Each of Apollo and the Apollo Investors believes that the merger is procedurally fair to unaffiliated AMCE stockholders based upon the following factors:

•

the Independent Committee consisted entirely of directors who are not AMCE officers or controlling shareholders or affiliated with any controlling shareholders of AMCE or with J.P. Morgan Partners.



•

the members of the Independent Committee will not personally benefit from the consummation of the merger in a manner different from the unaffiliated AMCE stockholders.



•

the Independent Committee retained and was advised by independent legal counsel experienced in advising on similar transactions.



•

the Independent Committee retained and was advised by Lazard, an independent investment banker, which assisted the committee in its evaluation of the fairness from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing) of the $19.50 per share cash merger consideration.



•

the merger was unanimously approved by the members of the Independent Committee and by all members of our Board of Directors voting on the matter.

        Each of Apollo and the Apollo Investors believes that the merger is procedurally fair despite the fact that the terms of the merger agreement do not specifically require the approval of at least a majority of the unaffiliated security holders of AMCE (as such term is defined in Rule 13e-3 under the Exchange Act) and that our Board of Directors did not retain an unaffiliated representative, other than the Independent Committee, to act solely on behalf of the unaffiliated security holders of AMCE for purposes of negotiating the terms of the merger agreement. In this regard, each of Apollo and the Apollo Investors note that the use of a special committee of independent directors is a mechanism well recognized to ensure fairness of the transactions of this type. Apollo and the Apollo Investors did not rely on any report, opinion or appraisal from an outside party in determining the fairness of the merger to the unaffiliated security holders of AMCE (including the opinions and analysis of Goldman or Lazard, including the premium analysis of Lazard), nor did they rely on the analysis of our Board or the Independent Committee in determining the fairness of the merger to the unaffiliated AMCE stockholders, nor have they assigned specific relative weights to the factors considered by them. Neither Apollo nor the Apollo Investors believed that the timing of AMCE's announcement of positive earnings on the same date as announcement of the transaction and its possible effect on the market price of AMCE's common stock to be a material consideration for the following reasons:

•

the fact that, although the announced earnings for the July 1, 2004 quarter indicated a positive trend when compared to AMCE's earnings for the corresponding quarter of its previous fiscal year, such earnings were within the range of analysts' estimates for AMCE's financial performance during the quarter;



•

the fact that such earnings fell short of AMCE's financial plan which had been previously disclosed to the Apollo Investors and the JPMP Investors during the course of the merger

72

discussions, the fact that the JPMP Investors cited such shortfall as a basis for seeking a reduction of their previously proposed $19.50 per share cash merger consideration, and the fact that AMCE's Board and the Independent Committee (and their respective advisors) were only able to dissuade the JPMP Investors from insisting on such a reduction after extensive negotiations;

•

the fact that, despite the positive quarterly results (which nevertheless represented a shortfall to AMCE's financial plan), growth in AMCE's annual earnings—which Apollo believed to be an important factor in determining the long-term market value of AMCE's common stock—would also likely fall short of AMCE's financial plan, especially given AMCE management's expectations that the earnings to be achieved later in the fiscal year might not be as strong as the earnings achieved during the fiscal 2004 Christmas and New Year's holiday season, as the slate of fiscal 2005 holiday theatrical releases was not expected to perform in the aggregate as well as the films released during the comparable period in fiscal 2004.

        None of Apollo or the Apollo Investors considered net book value in determining the fairness of the merger to unaffiliated AMCE stockholders because they believe that net book value, which is an accounting concept, does not reflect, or have any meaningful impact on, the market trading prices for the AMCE common stock. They note, however, that the merger consideration of $19.50 per share of AMCE common stock is higher than the net book value of the AMCE common stock. None of Apollo or the Apollo Investors considered liquidation value in determining the fairness of the merger to unaffiliated AMCE stockholders because of their belief that liquidation value did not present a meaningful valuation for AMCE and its business; rather, it was the belief of Apollo and the Apollo Investors that AMCE's value is derived from the cash flows generated from its continuing operations, rather than from the value of its assets that might be realized in a liquidation. Further, because AMCE's assets include a significant amount of intangible assets, intellectual property, rented properties and other assets that are not readily transferable or are subject to restrictions on their transfer in a liquidation scenario, Apollo and the Apollo Investors concluded that AMCE is not susceptible to a meaningful liquidation valuation. Moreover, it was the belief of Apollo and the Apollo Investors that a large part of AMCE's success is attributable to its market share and market presence as a chain of numerous individual properties unified by a recognizable brand name and reputation for quality, and any liquidation of its assets or break-up or piecemeal sale of its parts would not maximize stockholder value because it would not likely compensate AMCE's stockholders for the value inherent in AMCE's market position or brand identity. Therefore, Apollo and the Apollo Investors believed that the liquidation methodology would result in a lower valuation for AMCE than had been proposed in the merger negotiations.

        Further, none of Apollo or the Apollo Investors established a pre-merger going concern value for AMCE, assuming the sale of AMCE as an integrated business (that is, a "going concern"). None of Apollo or the Apollo Investors believed that there is a single method for determining going concern value and, therefore, did not base their valuation of AMCE on a concept that is subject to various interpretations. Further, Apollo and the Apollo Investors believed that, to the extent that AMCE's pre-merger going concern value was already reflected in the pre-announcement per share stock price of AMCE common stock, such pre-merger going concern value undervalued AMCE in comparison to the offer prices being discussed in the merger negotiations, which from the outset reflected a premium to such pre-announcement stock price. Moreover, since going concern value is often defined as the ability to generate earnings (rather than cash flows) from its assets, Apollo and the Apollo Investors did not believe that AMCE's pre-merger going concern value was meaningful in determining the fairness of the merger because, following the merger, AMCE will have a significantly different capital structure, which will result in different opportunities and risks for the business as a highly leveraged private company. For example, AMCE will have a significantly different level of fixed interest costs following the merger, which will affect AMCE's ability to generate earnings from its assets. Thus, none of Apollo or the

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Apollo Investors believes that AMCE's pre-merger going concern value would be a significant consideration in determining what value potential acquirors were likely to place on AMCE, which would be a much more highly leveraged company in the hands of such acquirors.

        Apollo and the Apollo Investors believe that these factors provide a reasonable basis for their belief that the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders. This belief should not, however, be construed as a recommendation to any AMCE stockholder to vote to approve the merger agreement. Apollo and the Apollo Investors do not make any recommendation as to how stockholders of AMCE should vote their shares relating to the merger or any related transaction.

Position of the JPMP Investors as to the Fairness of the Merger

        Under a possible interpretation of the rules governing "going private" transactions, the JPMP Investors, which are the thirteen entities identified on page 23, may be deemed to be affiliates of AMCE and required to express their beliefs as to the substantive and procedural fairness of the merger to unaffiliated AMCE stockholders. Each of the JPMP Investors is making the statements included in this sub-section solely for the purposes of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. Each of the JPMP Investors believes that the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders on the basis of the factors described below.

        None of the JPMP Investors participated in the deliberations of AMCE's Board of Directors regarding, or received advice from AMCE's legal or financial advisors as to, the substantive and procedural fairness of the merger to the unaffiliated AMCE stockholders. Based on the JPMP Investors' knowledge and analysis of available information regarding AMCE, however, as well as discussions with members of AMCE's senior management regarding the factors considered by, and the findings of, the Independent Committee and AMCE's Board of Directors discussed in the section entitled "Special Factors—Recommendations of the Independent Committee and the Board of Directors; Fairness of the Merger" beginning on page 67, the JPMP Investors believe that the merger is substantively and procedurally fair to unaffiliated AMCE stockholders. In particular, they considered the following:

•

each of the Independent Committee and AMCE's Board of Directors determined, by the unanimous vote of all directors voting on the matter, that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are substantively and procedurally fair to and in the best interests of AMCE and the unaffiliated AMCE stockholders.



•

the Independent Committee received the opinion of Lazard, dated July 22, 2004, to the effect that, as of that date and based upon and subject to the various assumptions made, procedures followed, matters considered and limitations upon the review undertaken as described in its opinion, the $19.50 per share cash merger consideration provided by the merger agreement was fair, from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing).



•

AMCE's Board of Directors received the opinion of Goldman Sachs, dated July 22, 2004, to the effect that, as of that date and based upon and subject to the factors and assumptions set forth in its opinion, the $19.50 per share in cash to be received by the holders (other than Holdings, the Apollo Funds, members of AMCE management who have the option to participate in Holdings, the holders of AMCE Class B stock, and their affiliates) of the outstanding shares of

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AMCE common stock pursuant to the merger agreement was fair from a financial point of view to those holders.

•

the $19.50 in cash to be received by AMCE's stockholders in the merger represents a premium of approximately 37.1% over the closing price of shares of AMCE common stock on the day before the appearance of news stories discussing the transaction and a premium of approximately 27.5% over the average closing price of shares of AMCE common stock over a three month period.



•

the merger will provide consideration to AMCE's shareholders entirely in cash.

        Each of the JPMP Investors believes that the merger is procedurally fair to unaffiliated AMCE stockholders based upon the following factors:

•

the Independent Committee consisted entirely of directors who are not AMCE officers or controlling shareholders or affiliated with any controlling shareholders of AMCE or with J.P. Morgan Partners.



•

the members of the Independent Committee will not personally benefit from the consummation of the merger in a manner different from the unaffiliated AMCE stockholders.



•

the Independent Committee retained and was advised by independent legal counsel experienced in advising on similar transactions.



•

the Independent Committee retained and was advised by Lazard, an independent investment banker, which assisted the committee in its evaluation of the fairness from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing) of the $19.50 per share cash merger consideration.



•

the merger was unanimously approved by the members of the Independent Committee and by all members of AMCE's Board of Directors voting on the matter.

        Each of the JPMP Investors believes that the merger is procedurally fair despite the fact that the terms of the merger agreement do not specifically require the approval of at least a majority of the unaffiliated security holders of AMCE (as such term is defined in Rule 13e-3 under the Exchange Act) and that AMCE's Board of Directors did not retain an unaffiliated representative, other than the Independent Committee, to act solely on behalf of the unaffiliated security holders of AMCE for purposes of negotiating the terms of the merger agreement. In this regard, each of the JPMP Investors note that the use of a special committee of independent directors is a mechanism well recognized to ensure fairness of the transactions of this type. The JPMP Investors did not rely on any report, opinion or appraisal from an outside party in determining the fairness of the merger to the unaffiliated security holders of AMCE, nor have they assigned specific relative weights to the factors considered by them.

        None of the JPMP Investors considered net book value in determining the fairness of the merger to unaffiliated AMCE stockholders because they believe that net book value, which is an accounting concept, does not reflect, or have any meaningful impact on, the market trading prices for the AMCE common stock. They note, however, that the merger consideration of $19.50 per share of AMCE common stock is higher than the net book value of the AMCE common stock. None of the JPMP Investors considered liquidation value in determining the fairness of the merger to unaffiliated AMCE stockholders because of their belief that liquidation value did not present a meaningful valuation for AMCE and its business; rather, it was the belief of the JPMP Investors that AMCE's value is derived from the cash flows generated from its continuing operations, rather than from the value of its assets that might be realized in a liquidation. Further, because AMCE's assets include a significant amount of

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intangible assets, intellectual property, rented properties and other assets that are not readily transferable or are subject to restrictions on their transfer in a liquidation scenario, the JPMP Investors concluded that AMCE is not susceptible to a meaningful liquidation valuation. Moreover, it was the belief of the JPMP Investors that a large part of AMCE's success is attributable to its market share and market presence as a chain of numerous individual properties unified by a recognizable brand name and reputation for quality, and any liquidation of its assets or break-up or piecemeal sale of its parts would not maximize stockholder value because it would not likely compensate AMCE's stockholders for the value inherent in AMCE's market position or brand identity. Therefore, the JPMP Investors believed that the liquidation methodology would result in a lower valuation for AMCE than had been proposed in the merger negotiations.

        Further, the JPMP Investors did not establish a pre-merger going concern value for AMCE, assuming the sale of AMCE as an integrated business (that is, a "going concern"). The JPMP Investors did not believe that there is a single method for determining going concern value and, therefore, did not base their valuation of AMCE on a concept that is subject to various interpretations. Further, the JPMP Investors believed that, to the extent that AMCE's pre-merger going concern value was already reflected in the pre-announcement per share stock price of AMCE common stock, such pre-merger going concern value undervalued AMCE in comparison to the offer prices being discussed in the merger negotiations, which from the outset reflected a premium to such pre-announcement stock price. Moreover, since going concern value is often defined as the ability to generate earnings (rather than cash flows) from its assets, the JPMP Investors did not believe that AMCE's pre-merger going concern value was meaningful in determining the fairness of the merger because, following the merger, AMCE will have a significantly different capital structure, which will result in different opportunities and risks for the business as a highly leveraged private company. For example, AMCE will have a significantly different level of fixed interest costs following the merger, which will affect AMCE's ability to generate earnings from its assets. Thus, the JPMP Investors did not believe that AMCE's pre-merger going concern value would be a significant consideration in determining what value potential acquirors were likely to place on AMCE, which would be a much more highly leveraged company in the hands of such acquirors.

        The JPMP Investors believe that these factors provide a reasonable basis for their belief that the merger is fair to unaffiliated AMCE stockholders. This belief should not, however, be construed as a recommendation to any AMCE stockholder to vote to approve the merger agreement. The JPMP Investors do not make any recommendation as to how stockholders of AMCE should vote their shares relating to the merger or any related transaction.

Position of Holdings and Marquee as to the Fairness of the Merger

        Under the rules governing "going private" transactions, Holdings and Marquee are required to express their beliefs as to the substantive and procedural fairness of the merger to unaffiliated AMCE stockholders. Each of Holdings and Marquee is making the statements included in this sub-section solely for the purposes of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. Each of Holdings and Marquee believes that the merger is substantively and procedurally fair to unaffiliated AMCE stockholders on the basis of the factors described below.

        Neither Holdings nor Marquee participated in the deliberations of AMCE's Board of Directors regarding, or received advice from AMCE's legal or financial advisors as to, the fairness of the merger to unaffiliated AMCE stockholders. Based on Holdings and Marquee's knowledge and analysis of available information regarding AMCE, as well as discussions with members of AMCE's senior management regarding AMCE and its business and the factors considered by, and findings of, the Independent Committee and AMCE's Board of Directors discussed in the section entitled "Special Factors—Recommendations of the Independent Committee and of the Board of Directors; Fairness of the Merger" beginning on page 67, Holdings and Marquee believe that the merger is substantively and

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procedurally fair to unaffiliated AMCE stockholders. In addition, as entities jointly owned by the JPMP Investors and the Apollo Investors, Holdings and Marquee considered the same factors considered by, and adopted the analyses of, Apollo and the Apollo Investors, as discussed in this proxy statement in the section entitled "Special Factors—Position of Apollo and the Apollo Investors as to the Fairness of the Merger" beginning on page 70, and the JPMP Investors, as discussed in this proxy statement in the section entitled "Special Factors—Position of the JPMP Investors as to the Fairness of the Merger" beginning on page 74.

        Holdings and Marquee believe that these factors provide a reasonable basis for their belief that the merger is substantively and procedurally fair to unaffiliated AMCE stockholders. This belief should not, however, be construed as a recommendation to any AMCE stockholder to vote to approve the merger agreement. Holdings and Marquee do not make any recommendation as to how stockholders of AMCE should vote their shares relating to the merger or any related transaction.

Position of the Management Investors as to the Fairness of the Merger

        Under the rules governing "going private" transactions, the Management Investors are required to express their beliefs as to the substantive and procedural fairness of the merger to unaffiliated AMCE stockholders. The Management Investors are making the statements included in this sub-section solely for the purposes of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act. The Management Investors believe that the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders on the basis of the factors described below.

        Mr. Brown, in his capacity as a member of AMCE's Board, participated in the deliberations of AMCE's Board in its consideration of the transaction. In such capacity, he received advice from AMCE's legal and financial advisors, including advice from AMCE's financial advisors as to the fairness of the transaction. See "Special Factors—Opinion of Goldman Sachs" on page 88. Mr. Brown was not a member of, and did not participate in the deliberations of, the Independent Committee.

        Mr. Singleton is not a member of AMCE's Board of Directors. Mr. Singleton did not participate in the deliberations of AMCE's Board regarding, and did not receive any advice from AMCE's legal or financial advisors as to, the fairness of the merger to the unaffiliated AMCE stockholders, or any other aspect of the transaction. Mr. Singleton was not informed as to the analysis of, or conclusions reached, by the Independent Committee as to the fairness of the merger to the unaffiliated AMCE stockholders and was not present when the Independent Committee delivered its recommendation to the Board.

        The Management Investors believe the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders on the basis of the factors described below. However, the Management Investors have not performed, or engaged a financial advisor to perform, any valuation or other analysis for the purposes of assessing the fairness of the merger to the unaffiliated AMCE stockholders. Mr. Brown, in his capacity as a member of AMCE's Board, received advice from AMCE's financial advisors as to the fairness of the transaction.

        In making their determination that the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders, the Management Investors considered the following material positive factors:

•

The fact that the $19.50 in cash to be received by AMCE's stockholders in the merger represents:



•

a premium of approximately 37.1% over the closing price of shares of AMCE common stock on the day before the appearance of news stories discussing the transaction;



•

a premium of approximately 27.5% over the average closing price of shares of AMCE common stock over a three month period;

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•

a premium of approximately 28.2% over the average closing price of shares of AMCE common stock over a six month period;



•

a premium of approximately 35.8% over the average closing price of shares of AMCE common stock over a one year period; and



•

a premium of approximately 63.9% over the average closing price of shares of AMCE common stock over a three year period.

In their consideration of these premiums, the Management Investors did not believe that the timing of AMCE's announcement of positive earnings on the same date as announcement of the transaction and its possible effect on the market price of AMCE's common stock to be a material consideration for the following reasons:

•

the fact that, although the announced earnings for the July 1, 2004 quarter indicated a positive trend when compared to AMCE's earnings for the corresponding quarter of its previous fiscal year, such earnings were within the range of analysts' estimates for AMCE's financial performance during the quarter;



•

the fact that such earnings fell short of AMCE's financial plan which had been previously disclosed to the Apollo Investors and the JPMP Investors during the course of the merger discussions, the fact that the JPMP Investors cited such shortfall as a basis for seeking a reduction of their previously proposed $19.50 per share cash merger consideration, and the fact that AMCE's Board and the Independent Committee (and their respective advisors) were only able to dissuade the JPMP Investors from insisting on such a reduction after extensive negotiations;



•

the fact that, despite the positive quarterly results (which nevertheless represented a shortfall to AMCE's financial plan), growth in AMCE's annual earnings—which the Management Investors believed to be an important factor in determining the long-term market value of AMCE's common stock—would also likely fall short of AMCE's financial plan, especially given AMCE management's expectations that the earnings to be achieved later in the fiscal year might not be as strong as the earnings achieved during the fiscal 2004 Christmas and New Year's holiday season, as the slate of fiscal 2005 holiday theatrical releases was not expected to perform in the aggregate as well as the films released during the comparable period in fiscal 2004.



•

The fact that holders of AMCE's common stock that do not vote in favor of the merger or otherwise waive their appraisal rights will have the opportunity to demand appraisal of the fair value of their shares under Section 262 of the General Corporation Law of the State of Delaware.



•

The fact that the merger will provide consideration to AMCE's shareholders entirely in cash.



•

The financing commitments received by Holdings with respect to the merger agreement, the identity of the institutions providing such commitments and the conditions to the obligations of such institutions to fund such commitments; each as described under the caption "The Merger—Merger Financing" on page 115.



•

The fact that each of the Independent Committee and the AMCE Board of Directors determined, by the unanimous vote of all directors voting on the matter, that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to and in the best interests of AMCE and its stockholders. In this regard, although Mr. Singleton did not participate in the deliberations of AMCE's Board and was not present when the Independent Committee delivered its recommendation to the Board, he considered such recommendation and views it favorably.

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•

The fact that the Independent Committee received the opinion of Lazard, dated July 22, 2004, to the effect that, as of that date and based upon and subject to the various assumptions made, procedures followed, matters considered and limitations upon the review undertaken as described in its opinion, the $19.50 per share cash merger consideration provided by the merger agreement was fair, from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing).



•

The fact that the AMCE Board of Directors received the opinion of Goldman Sachs, dated July 22, 2004, to the effect that, as of that date and based upon and subject to the factors and assumptions set forth in its opinion, the $19.50 per share in cash to be received by the holders (other than Holdings, the Apollo Funds, members of AMCE management who have the option to participate in Holdings, the holders of AMCE Class B stock, and their affiliates) of the outstanding shares of AMCE common stock pursuant to the merger agreement was fair from a financial point of view to those holders.

        The Management Investors also considered the following material negative factors:

•

The fact that AMCE's stockholders, with the exception of the Apollo Investors, the Management Investors and certain other members of AMCE senior management who may purchase or be granted equity interests in Holdings prior to or upon consummation of the merger, will have no ongoing equity participation in AMCE following the merger; such stockholders will cease to participate in AMCE's future earnings or growth, if any, or to benefit from increases, if any, in the value of AMCE's stock owned by them, and will not participate in any future sale of AMCE to a third party.



•

The fact that there was no attempt made to contact other possible purchasers for AMCE (other than the private equity firms invited to participate in the transaction as discussed above) or to conduct a public auction of AMCE (although it was noted that only large buyers could commit for the amount of equity necessary to consummate a potential transaction, there was a limited universe of strategic buyers, certain financial sponsors who might otherwise be interested in a potential transaction in AMCE's industry were already participating in either the recent Cinemark transaction or the pending Loews Cineplex transaction, no expressions of interest had been received after published rumors about the transaction first appeared, there were certain benefits to negotiating with one potential buyer as a strategy to maximize value on an expedited and confidential basis and the potential adverse impact on AMCE of a broken deal and minimizing the risk of a broken deal). In this regard, it is noted that Mr. Singleton did not participate in the deliberations of AMCE's Board in determining not to attempt to contact other potential purchasers for AMCE.



•

The fact that AMCE will be responsible for all interest accruing on the amounts borrowed by the buyer group to finance the transaction starting at the time such amounts are placed into escrow, and the fact that, in addition to such amounts, AMCE will be responsible for payment to J.P. Morgan Partners of an expense coverage fee of $10 million (although it was noted that Apollo would not receive any part of the expense coverage fee) and payment of certain expenses (up to $11.25 million) associated with the buyer group's financing arrangements if the merger agreement is terminated under certain circumstances.



•

The fact that the cash consideration to be received by the holders of AMCE's stock will be taxable to them.

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•

The fact that Goldman Sachs has past and current relationships with AMCE and its affiliates (including Apollo); however, Mr. Brown did not believe such relationships impacted Goldman Sachs' analysis or influenced its conclusions. Mr. Singleton did not consider or rely upon Goldman Sachs' opinion in making his determination as to fairness.



•

The fact that AMCE has historically traded at lower multiples (calculated on the basis of the ratio of its stock price to its trailing twelve-month EBITDA) than its peer group, which could be due to the complex capital structure of AMCE.

        The Management Investors believe that the merger is procedurally fair to unaffiliated AMCE stockholders based upon the following factors:

•

The fact that the Independent Committee consisted entirely of directors who are not AMCE officers or controlling shareholders or affiliated with any controlling shareholders of AMCE or with J.P. Morgan Partners.



•

The fact that the members of the Independent Committee will not personally benefit from the consummation of the merger in a manner different from the unaffiliated AMCE stockholders.



•

The fact that the Independent Committee retained and was advised by independent legal counsel experienced in advising on similar transactions.



•

The fact that the Independent Committee retained and was advised by Lazard, an independent investment banker, which assisted the committee in its evaluation of the fairness from a financial point of view, to the holders of AMCE's common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE's Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee, or the new company formed by the merger, and affiliates of any of the foregoing) of the $19.50 per share cash merger consideration.



•

The fact that the merger was unanimously approved by the members of the Independent Committee and by all members of AMCE's Board of Directors voting on the matter (excluding Mr. Brown).

        The Management Investors believe that the merger is procedurally fair despite the fact that the terms of the merger agreement do not specifically require the approval of at least a majority of the unaffiliated security holders of AMCE (as such term is defined in Rule 13e-3 under the Exchange Act) and that AMCE's Board of Directors did not retain an unaffiliated representative, other than the Independent Committee, to act solely on behalf of the unaffiliated security holders of AMCE for purposes of negotiating the terms of the merger agreement. In this regard, the Management Investors note that the use of a special committee of independent directors is a mechanism recognized to ensure fairness of the transactions of this type. The Management Investors also believe that the merger is procedurally fair despite the fact that Mr. Brown, in his capacity as a member of AMCE's Board of Directors, participated in the deliberation of the merger; in this regard, the Management Investors note that all of the other members of the AMCE Board who voted on the transaction approved the merger.

        Mr. Singleton did not rely on any report, opinion or appraisal from an outside party in determining the fairness of the merger to the unaffiliated security holders of AMCE (including the opinions and analysis of Goldman Sachs or Lazard, including the premium analysis of Lazard), nor did he rely on the analysis of the AMCE Board of Directors or Independent Committee in determining the fairness of the merger to the unaffiliated security holders of AMCE. Mr. Brown, in his capacity as a member of AMCE's Board of Directors, considered the report of Goldman Sachs in assessing the fairness of the transaction to the unaffiliated stockholders. Neither of the Management Investors assigned specific relative weights to the factors considered by them.

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        The Management Investors did not consider net book value in determining the fairness of the merger to unaffiliated AMCE stockholders because they believe that net book value, which is an accounting concept, does not reflect, or have any meaningful impact on, the market trading prices for the AMCE common stock. They note, however, that the merger consideration of $19.50 per share of AMCE common stock is higher than the net book value of the AMCE common stock. The Management Investors did not consider liquidation value in determining the fairness of the merger to unaffiliated AMCE stockholders because of their belief that liquidation value did not present a meaningful valuation for AMCE and its business; rather, it was the belief of the Management Investors that AMCE's value is derived from the cash flows generated from its continuing operations, rather than from the value of its assets that might be realized in a liquidation. Further, because AMCE's assets include a significant amount of intangible assets, intellectual property, rented properties and other assets that are not readily transferable or are subject to restrictions on their transfer in a liquidation scenario, the Management Investors concluded that AMCE is not susceptible to a meaningful liquidation valuation. Moreover, it was the belief of the Management Investors that a large part of AMCE's success is attributable to its market share and market presence as a chain of numerous individual properties unified by a recognizable brand name and reputation for quality, and any liquidation of its assets or break-up or piecemeal sale of its parts would not maximize stockholder value because it would not likely compensate AMCE's stockholders for the value inherent in AMCE's market position or brand identity. Therefore, the Management Investors believed that the liquidation methodology would result in a lower valuation for AMCE than had been proposed in the merger negotiations.

        The Management Investors took note of the valuation analyses performed by each of Lazard and Goldman Sachs, some of which represented the sale of AMCE as a continuing business and some of which represented AMCE remaining as a stand-alone entity. While the Management Investors did not believe that there is a single method for determining "going concern value," the Management Investors believed that the valuation methodologies of each of Lazard and Goldman Sachs represented a valuation of AMCE as it continues to operate its business, and, to that extent, such analyses could be collectively characterized as a form of going concern valuation. For example, the Management Investors took note of the comparable companies analyses of each of Lazard and Goldman Sachs, which could be considered to represent the "stand alone" valuation of AMCE if it traded at the multiples calculated for the comparable companies. In addition, the discounted cash flow analyses performed by each of Lazard and Goldman Sachs could be considered a "stand-alone" valuation of AMCE based on the present value of the estimated future unlevered free cash flows and present value of the terminal value of AMCE. The Management Investors took note of these analyses in the context of the other factors the Management Investors considered relevant to the fairness of the merger to the unaffiliated stockholders.

        The Management Investors believe that these factors provide a reasonable basis for their belief that the merger is substantively and procedurally fair to the unaffiliated AMCE stockholders. This belief should not, however, be construed as a recommendation to any AMCE stockholder to vote to approve the merger agreement. However, Mr. Brown, in his capacity as a member of AMCE's Board of Directors, concurs with the recommendation of the AMCE Board that AMCE stockholders adopt the merger agreement. See "Special Factors—Recommendations of the Independent Committee and the Board of Directors; Fairness of the Merger—Our Board of Directors" beginning on page 68. Mr. Singleton does not make any recommendation in any capacity as to how stockholders of AMCE should vote their shares relating to the merger or any related transaction.

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Opinion of Lazard

        Pursuant to an engagement letter, dated June 9, 2004, the Independent Committee retained Lazard to act as its investment banker in connection with the merger. As part of this engagement, Lazard delivered an oral opinion to the Independent Committee, subsequently confirmed in a written opinion dated July 22, 2004, that, as of the date of Lazard's written opinion and based upon and subject to the various assumptions made, procedures followed, matters considered and limitations upon the review undertaken as described in the written opinion, the $19.50 per share cash merger consideration was fair, from a financial point of view, to the holders of AMCE common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or the new company formed by the merger and affiliates of any of the foregoing). The exclusion of certain holders of AMCE capital stock from the opinion of Lazard was intended to apply to all stockholders who might be deemed to be affiliates of AMCE.

        The full text of the Lazard opinion is attached as Appendix B-2 to this proxy statement and is incorporated into this proxy statement by reference. The description of the Lazard opinion set forth in this proxy statement is qualified in its entirety by reference to the full text of the Lazard opinion set forth in Appendix B-2. Shareholders are urged to read the Lazard opinion in its entirety for a description of the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Lazard in connection with the opinion. Lazard's written opinion is directed to the Independent Committee and only addresses the fairness, from a financial point of view, to the holders of AMCE common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or the new company formed by the merger and affiliates of any of the foregoing) of the $19.50 per share in cash to be paid to such holders in the merger. Lazard's written opinion does not address the merits of the underlying decision by AMCE to engage in the merger or any other aspect of the merger and does not constitute a recommendation to any stockholder as to how the stockholder should vote on any matter relating to the merger. Lazard's opinion is necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Lazard as of, the date of the Lazard opinion. Lazard assumes no responsibility for updating or revising its opinion based on circumstances or events occurring after the date of the opinion. The following is only a summary of the Lazard opinion. You are encouraged to read the entire opinion.

        In connection with its opinion, Lazard:

•

reviewed the financial terms and conditions contained in a draft of the merger agreement, dated July 22, 2004, which was provided to Lazard by the Independent Committee; Lazard was advised by the Independent Committee that such draft merger agreement did not differ materially from the final merger agreement;



•

analyzed certain historical business and financial information relating to AMCE;



•

reviewed various financial forecasts and other data provided to Lazard by AMCE relating to AMCE's business;



•

held discussions with members of the senior management of AMCE with respect to the business and prospects of AMCE;



•

reviewed public information with respect to certain other companies in lines of business Lazard believed to be generally comparable to the business of AMCE;



•

reviewed the historical stock prices and trading volumes of AMCE common stock; and

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•

conducted such other financial studies, analyses and investigations as Lazard deemed appropriate.

        Lazard relied upon the accuracy and completeness of the foregoing information, and did not assume any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of AMCE, or concerning the solvency or fair value of AMCE. With respect to financial forecasts and other information and data provided to, or otherwise reviewed by, Lazard, Lazard assumed that they had been reasonably prepared on bases reflecting the best currently available estimates and judgments of management of AMCE as to the future financial performance of AMCE. Lazard assumed no responsibility for and expressed no view as to such forecasts or other information or data or the assumptions on which they were based. In some cases, Lazard made adjustments, as appropriate for purposes of its analysis, to AMCE's earnings before interest, taxes, depreciation and amortization (EBITDA) or earnings before interest, taxes, depreciation, amortization and rent (EBITDAR). Lazard was not authorized to contact, and Lazard did not contact, any other party regarding a potential transaction with AMCE, nor was Lazard requested to consider, and Lazard's opinion does not address, the relative merits of the merger as compared to any other transaction in which AMCE might engage. Lazard's opinion is limited to the fairness, from a financial point of view, to the holders of AMCE common stock (other than Holdings, Marquee, the Apollo Funds, holders of AMCE Class B stock, any persons or entities who will, upon consummation of the merger, be direct or indirect holders of interests in Holdings, Marquee or the new company formed by the merger and affiliates of any of the foregoing) of the $19.50 per share in cash to be paid to such holders in the merger, and Lazard expressed no opinion as to the fairness of the consideration to be received by any other holders of capital stock of AMCE, the fairness of such consideration relative to the consideration to be received by holders of AMCE common stock or the underlying decision by AMCE to engage in the merger. Lazard was not asked to express and did not express any opinion as to any aspect of the change of control distribution or the Apollo Investors' reinvestment in Holdings.

        Lazard noted that its opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to them as of, the date of the opinion.

        In rendering its opinion, Lazard assumed that the merger would be consummated on the terms described in the draft merger agreement reviewed by Lazard, without any waiver of any material terms or conditions by AMCE, and that obtaining the necessary regulatory approvals for the merger would not have an adverse effect on AMCE. The Independent Committee advised Lazard, and Lazard assumed, that the final terms of the merger agreement would not differ materially from those set forth in the draft reviewed by Lazard.

        Lazard did not express any opinion as to the price at which AMCE common stock might trade subsequent to the announcement of the merger. Lazard's opinion did not address the merits of the underlying decision by AMCE to engage in the merger and is not intended to constitute a recommendation to any shareholder of AMCE as to how such holder should vote with respect to the merger or any matter relating thereto.

        The following is a brief summary of the material financial and comparative analyses that Lazard deemed to be appropriate for this type of transaction and that were performed by Lazard in connection with rendering its opinion. The following summaries of financial analyses include information included in tabular format. You should read these tables together with the text of each summary.

        Comparable Companies Analysis.    Lazard reviewed selected publicly available financial and other data of certain companies having businesses or other characteristics that it deemed reasonably comparable to AMCE or the business of AMCE. Carmike Cinemas, Inc. and Regal Cinemas Corporation were selected as the comparable companies because they are publicly traded companies in the U.S. whose principal line of business (theatrical exhibition) is most similar to that of AMCE.

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        The forecasted financial information used by Lazard for AMCE in the course of this analysis was based on estimates published by Institutional Brokers Estimate System (IBES), and the forecasted financial information used by Lazard for the comparable companies in the course of this analysis was based on research estimates and estimates published by IBES. The historical financial information used by Lazard in the course of this analysis was based on publicly available historical information. As the comparable companies analysis is based on the value of each company on a stand alone basis (and not in the context of a change of control transaction), Lazard did not give effect to the change of control distribution in the comparable companies analysis. Calculations were made based on the closing price per share of each company's stock as of July 16, 2004. Subsequently Lazard orally updated its presentation to the Independent Committee with respect to the comparable companies analysis performed by Lazard in evaluating the implied per share value of AMCE common stock to reflect closing prices on July 19, 2004, which was the date of the last unaffected closing price of AMCE common stock prior to the announcement of the merger. The results of the updated presentation did not differ in any meaningful way from the presentation made by Lazard based on the closing price of each company's common stock on July 16, 2004.

        For each of the selected comparable companies and AMCE, Lazard derived and compared the total enterprise value of each comparable company as a multiple of:

•

actual revenue for the calendar year 2003 and for the twelve-month period immediately preceding March 31, 2004, in the case of the comparable companies, and April 1, 2004, in the case of AMCE;



•

estimated revenue for each of the calendar years 2004 and 2005;



•

actual EBITDA for the calendar year 2003 and the twelve-month period immediately preceding March 31, 2004, in the case of the comparable companies, and April 1, 2004, in the case of AMCE; and



•

estimated EBITDA for each of the calendar years 2004 and 2005.

        Enterprise value was calculated as equity value plus net debt.

        The results of the analysis were as follows:

Enterprise Value as a Multiple of:

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        For each of the selected comparable companies and AMCE, Lazard compared closing prices to actual earnings per share for the calendar year 2003 and estimated earnings per share for each of calendar years 2004 and 2005. The results of the analysis were as follows:

Closing Price as a Multiple of:

        For each of the selected comparable companies, Lazard also adjusted enterprise value by capitalizing rents at an 8.0x multiple and adding that amount to enterprise value, and then calculated the adjusted enterprise value for each company as a multiple of that company's (i) actual EBITDAR for the calendar year 2003, (ii) EBITDAR for the twelve-month period immediately preceding March 31, 2004, in the case of the comparable companies, and April 1, 2004, in the case of AMCE and (iii) estimated EBITDAR for each of the calendar years 2004 and 2005.

        The results of the analysis were as follows:

Adjusted Enterprise Value as a Multiple of:

        Applying the derived revenue and EBITDA multiples to the appropriate revenue and EBITDA data for AMCE, Lazard determined a range of implied enterprise values of AMCE. Lazard subtracted net debt to determine a range of equity values and divided by shares outstanding to determine a range of implied per share values. Applying the derived EBITDAR multiples to the appropriate EBITDAR data for AMCE, Lazard determined a range of implied adjusted enterprise values of AMCE. Lazard subtracted capitalized rents and net debt to determine a range of equity values and divided by shares outstanding to determine a range of implied per share values. Applying the derived multiples of earnings per share to the appropriate earnings per share data for AMCE, Lazard determined a range of implied per share values. Based on this analysis, Lazard calculated a range for the implied per share value of AMCE common stock of $14.23 to $20.65. Lazard noted that the common stock consideration was within this range.

        Precedent Transactions Analysis.    Lazard reviewed selected publicly available financial information for merger and acquisition transactions in the theatrical exhibition industry. Five transactions were selected as comparable for purposes of the precedent transactions analysis because they involved acquisitions since March 2002 of companies whose principal line of business is similar to that of AMCE. The financial information used by Lazard in the course of this analysis was based on historical information. As the precedent transactions analysis is based on the value of each company in a change of control context, Lazard gave effect to the change of control distribution in the precedent

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transactions analysis. Of the precedent transactions evaluated by Lazard, Lazard selected the following transactions for its precedent transaction analysis:

        These five transactions were selected because they involved the acquisition of U.S. companies with transaction values in excess of $45 million and because there was adequate financial information available with respect to these transactions. Lazard was also aware of other merger and acquisition transactions in the theatrical exhibition industry, but did not believe these transactions were appropriate for the precedent transactions analysis because either the target companies were non-U.S. companies or were being acquired out of (or had recently emerged from) bankruptcy, the transaction size was less than $45 million or inadequate financial information was available with respect to the transaction.

        For each of the precedent transactions, Lazard derived and compared the transaction value, as disclosed, as a multiple of sales and EBITDA, in each case for the twelve-month period immediately prior to the announcement of the transaction for which results were available. In each case, Lazard also adjusted the transaction value to reflect capitalized rents, and calculated this adjusted transaction value as a multiple of EBITDAR for the twelve-month period immediately prior to the announcement of the transaction. The results of this analysis were as follows:

        Applying the derived sales and EBITDA multiples to the appropriate sales and EBITDA data for AMCE, Lazard determined a range of implied enterprise values of AMCE. Lazard subtracted net debt to determine a range of equity values and divided by shares outstanding to determine a range of implied per share values. Applying the derived EBITDAR multiples to the appropriate EBITDAR data for AMCE, Lazard determined a range of implied adjusted enterprise values of AMCE. Lazard subtracted capitalized rents and net debt to determine a range of equity values and divided by shares outstanding to determine a range of implied per share values. Based on this analysis, Lazard calculated a range for the implied per share value of AMCE common stock of $10.54 to $17.35. Lazard noted that the $19.50 per share in cash to be paid to holders of AMCE common stock in the merger was above the upper end of this range.

        Discounted Cash Flow Analysis.    Lazard performed a discounted cash flow analysis to determine a range for the implied per share value of AMCE common stock. Lazard derived this range by calculating the present value at September 30, 2004 of AMCE's estimated future unlevered free cash

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flow for the second half of AMCE's fiscal year 2005 through 2008 and adding to this amount the present value of the terminal value in 2008 and the present value of the tax benefit of AMCE's net operating losses (NOLs). In each case, present values were calculated using discount rates ranging from 9.5% to 11.5%, which Lazard viewed as appropriate based on the weighted average cost of capital of AMCE. Lazard calculated the terminal value using a range of terminal year EBITDA exit multiples of 5.5x to 7.5x, which Lazard selected based on a number of factors, including the multiples derived in the precedent transactions analysis and the trading multiples derived in the comparable companies analysis. Forecasted financial information was based on estimates provided to Lazard by the management of AMCE. Lazard's analysis excluded any cash flows resulting from sale/leaseback transactions. Net debt was determined as of September 30, 2004. Lazard calculated implied share values on a stand-alone basis (and not in the context of a change of control transaction). Accordingly, Lazard did not give effect to the change of control distribution in the discounted cash flow analysis. Net debt includes the present value of cash dividends for the period between September 30, 2004 and April 19, 2006 discounted at 7%. The results of this analysis were follows:

        Based on the lowest and highest share prices implied by this analysis, Lazard derived a range for the implied per share value of AMCE common stock of $16.28 to $23.80. Lazard noted that the $19.50 per share in cash to be paid to holders of AMCE common stock in the merger was within this range.

        Leveraged Buyout Analysis.    Lazard performed an analysis as to the implied per share value of AMCE common stock assuming a range of target rates of return in a leveraged buyout of AMCE. Forecasted financial information used in this analysis was based on projections provided by the management of AMCE. As a leveraged buyout analysis is based on the value of a company in a change of control context, Lazard gave effect to the change of control distribution in the leveraged buyout analysis. In its analysis, Lazard used ranges of exit multiples and ranges of target rates of return that it selected based on a number of factors, including the multiples derived in the precedent transactions analysis, the trading multiples derived in the comparable companies analysis and current market conditions for comparable leveraged buyout transactions. Lazard assumed a 2009 exit at a multiple of EBITDA ranging from 6.0x to 8.0x. Based on these assumptions and target rates of return between 17.5% and 25%, Lazard derived a range for the implied per share value of AMCE of $16.70 to $20.40. Lazard noted that the $19.50 per share in cash to be paid to holders of AMCE common stock in the merger was within this range.

        The summary set forth above does not purport to be a complete description of the analyses performed by Lazard, although it is a summary of the material financial and comparative analyses presented by Lazard to the Independent Committee. The preparation of financial analyses is a complex process involving various determinations as to the most appropriate and relevant methods of financial analysis and, therefore, is not necessarily susceptible to partial analysis or summary description. Selecting the portions of the analyses or the summary set forth above without considering the analyses as a whole could create an incomplete or misleading view of the process underlying Lazard's presentation to the Independent Committee. In formulating its presentation to the Independent Committee, Lazard considered the results of all of its analyses and did not attribute any particular weight to any factor or analyses considered by it; rather, Lazard formulated its presentation on the basis of its experience and professional judgment after considering the results of its analyses. No company or transaction used in the above analyses as a comparison is directly comparable to AMCE or the transactions contemplated by the merger agreement or the merger. The analyses were prepared

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solely for the purpose of Lazard rendering advice to the Independent Committee in connection with the Independent Committee's consideration of the merger, and those analyses do not purport to be appraisals or necessarily reflect the prices at which businesses or securities actually may be sold, which may be significantly more or less favorable than set forth in the analyses. You should understand that estimates of values and forecasts of future results contained in the analyses, whether publicly available or provided by the management of AMCE, were based upon numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of AMCE, and are not necessarily indicative of actual values or actual future results, which may be significantly more or less favorable than suggested by such analyses. Lazard made no recommendation to the Independent Committee, and makes no recommendation to any stockholder of AMCE, as to how the Independent Committee or such stockholder should vote with respect to the transactions contemplated by the Agreement or the merger.

        In performing its analyses, Lazard made numerous assumptions with respect to industry performance, general business, economic, market and financial conditions and other matters. Because those analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of AMCE or its advisors, neither AMCE, Lazard nor any other person assumes responsibility if future results or actual values are materially different from those forecasts or estimates contained in the analyses.

        Lazard is an internationally recognized investment banking firm providing a full range of financial advisory and securities services. Lazard was selected to act as investment banker to the Independent Committee because of its qualifications, expertise and reputation in investment banking and mergers and acquisitions.

        In connection with Lazard's services as the Independent Committee's investment banker, AMCE agreed to pay Lazard (a) $250,000 upon execution of the engagement letter dated June 9, 2004, (b) an additional $750,000 upon the delivery of Lazard's opinion and (c) a fee (against which any amounts paid pursuant to clauses (a) and (b) above would be credited) payable upon the closing of the merger equal to .60% of the "aggregate consideration" paid to the holders of AMCE common stock, but in no event less than $1,250,000. For the purposes of the fee, "aggregate consideration" means the number of shares of AMCE common stock, on a fully diluted basis as customarily calculated, purchased in the merger multiplied by the final per share consideration at which the merger is consummated. AMCE has also agreed to reimburse Lazard for its reasonable out-of-pocket expenses (including attorneys' fees) and to indemnify Lazard and certain related parties against certain liabilities under certain circumstances that may arise out of the rendering of the advice, including certain liabilities under U.S. federal securities laws. Lazard has in the past provided investment banking services to previous independent committees of AMCE's Board of Directors for which Lazard has received customary fees. Lazard, as part of its investment banking business, is continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements, leveraged buyouts, and valuations for estate, corporate and other purposes. Lazard provides a full range of financial advisory and securities services and, in the ordinary course of its normal trading activities, from time to time may effect transactions and hold securities, including derivative securities, of AMCE for its own account and for the accounts of customers and accordingly, may at any time hold a long or short position in such securities.

Opinion of Goldman Sachs

        Goldman Sachs delivered an oral opinion to AMCE's Board of Directors, subsequently confirmed in writing, to the effect that, as of July 22, 2004, and based upon and subject to the factors and assumptions set forth in the opinion, the $19.50 per share in cash to be received by the holders (other than Holdings, the Apollo Funds, members of AMCE management who have the option to participate

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in Holdings, the holders of AMCE Class B stock and their respective affiliates) of the outstanding shares of AMCE common stock pursuant to the merger agreement was fair from a financial point of view to those holders. The exclusion of certain holders of AMCE capital stock from the opinion of Goldman Sachs was intended to apply to all stockholders who might be deemed to be affiliates of AMCE.

        The full text of the written opinion of Goldman Sachs, dated July 22, 2004, which sets forth the assumptions made, procedures followed, matters considered, and limitations on the review undertaken in connection with the opinion, is attached as Appendix B-2. Goldman Sachs provided its opinion for the information and assistance of AMCE's Board of Directors in connection with its consideration of the merger. Goldman Sachs' opinion is not a recommendation as to how any holder of AMCE common stock should vote with respect to the merger. We encourage you to read the opinion in its entirety.

        In connection with rendering the opinion described above and performing its related financial analyses, Goldman Sachs reviewed, among other things:

•

the merger agreement;



•

the Apollo consent and voting agreement;



•

a draft term sheet for the subscription agreement to be entered into by and among J.P. Morgan Partners (BHCA), L.P., Apollo Investment Fund V, L.P. and Holdings;



•

the Durwood Trust voting agreement;



•

annual reports to stockholders of AMCE and Annual Reports on Form 10-K of AMCE for the five fiscal years ended April 1, 2004;



•

interim reports to stockholders and Quarterly Reports on Form 10-Q of AMCE;



•

other communications from AMCE to its stockholders; and



•

internal financial analyses and forecasts for AMCE prepared by its management.

        Goldman Sachs also held discussions with members of the senior management of AMCE regarding its assessment of the potential benefits of the merger, and the past and current business operations, financial condition and future prospects of AMCE.

        In addition, Goldman Sachs:

•

reviewed the reported price and trading activity for AMCE common stock;



•

compared certain financial information for AMCE with similar financial and stock market information for other companies the securities of which are publicly traded;



•

reviewed the financial terms of recent business combinations in the film exhibitor industry specifically, and other industries generally; and



•

performed such other studies and analyses, and considered such other factors, as Goldman Sachs considered appropriate.

        Goldman Sachs noted that, in connection with the consummation of the merger, holders of AMCE preferred stock will receive additional shares of AMCE preferred stock pursuant to the change of control distribution and the Apollo Investors will acquire approximately 49.9% of the equity interests in Holdings.

        Goldman Sachs relied upon the accuracy and completeness of all of the financial, accounting, legal, tax and other information discussed with or reviewed by it and assumed such accuracy and completeness for purposes of rendering its opinion. In that regard, Goldman Sachs assumed, with the consent of AMCE's Board of Directors, that AMCE's forecasts were reasonably prepared on a basis reflecting the best currently available estimates and judgments of AMCE.

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        In addition, Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or off-balance-sheet assets and liabilities) of AMCE or any of its subsidiaries and Goldman Sachs was not furnished with any such evaluation or appraisal. Goldman Sachs did not express any opinion as to the impact of the merger on the solvency or viability of AMCE or the ability of AMCE to pay its obligations when they become due. Goldman Sachs' opinion does not address the underlying business decision of AMCE to engage in the merger. Goldman Sachs was not requested to solicit, and did not solicit, interest from other parties with respect to an acquisition of, or other business combination with, AMCE.

        In connection with Goldman Sachs' opinion, AMCE advised, and Goldman Sachs assumed, that the holders of the outstanding capital stock of AMCE are treated equally on an as-converted basis and in accordance with their respective rights under AMCE's Restated and Amended Certificate of Incorporation and Preferred Stock Certificate of Designations, except that the Apollo Investors are participating in the rollover of a portion of their cash proceeds or AMCE capital stock owned by them in connection with the merger, as to which rollover Goldman Sachs expressed no opinion.

        The following is a summary of the material financial analyses presented by Goldman Sachs to AMCE's Board of Directors in connection with rendering its opinion. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs. The order of analyses described does not represent the relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs' financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before July 16, 2004, and is not necessarily indicative of current market conditions.

Historical Premium Analysis

        Goldman Sachs calculated the implied premia represented by the $19.50 per share purchase price to be received by the holders of AMCE common stock pursuant to the merger based on the following closing prices for AMCE common stock on, or for the specified period ended, July 16, 2004, the last trading day before Goldman Sachs made its presentation of its financial analyses to AMCE's board of directors:

•

the closing price on July 16, 2004;



•

the 52-week high, average and low closing prices;



•

the three-year high, average and low closing prices; and



•

the three-month average and six-month average closing prices.

        The results of Goldman Sachs' calculations are reflected below: