According to various analysts, the industry's trouble is theresult of a heavily financed 33% expansion of luxury, multiscreentheaters during the latter half of the 1990s followed by paltry 13%growth in ticket sales - including a summer 2000 sales season down5% from 1999 – along with rising ticket prices. Indeed, instead ofthe oversupply driving prices down, average ticket prices haverisen 21% since 1994. Although the boom in theaters and prices isresponsible boosting total U.S. box office revenues by 39%, ithasn't been sufficient to cover debt payments on the fancy newtheaters or make up for lower revenues at the companies' smaller,older theaters. Analysts say many chains are now declaringbankruptcy in part to get out of long-term leases that have becomeunfavorable.

In lieu of that, Knoxville, TN-based Regal is apprentlyattempting to negotiate more favorable terms on its leasecontracts. Regal couldn't be reached for comment on Friday, butKassab tells GlobeSt. that Regal, which has 23 years left on a25-year lease, is requesting a reduction in its rent and in tradeis offering a "kickback" on movie receipts. Kassab says he'snegotiating with the company, and expects an outcome within thenext 30 days.

"I have to be fair to them, but I also have to be fair tomyself," Kassab tells GlobeSt. " If their proposal is not going tobe workable for us - because we have bills to pay too - and if theydecide to reject our lease, we'll go to plan B and have anothermovie theater chain take it over. And if those rates aren'tfavorable, we'll run it ourselves."