National CineMedia, Inc. Income Taxes Disclosure

The Company is subject to taxation in the U.S. and various states. The Company’s tax returns for the calendar years 2022 through 2024 remain open to examination by the IRS in their entirety. With respect to state taxing jurisdictions, the Company’s tax returns for calendar years ended 2021 through 2024, in general are eligible for examination by various state revenue services.

Recently enacted tax legislation—On July 4, 2025, the U.S. enacted H.R. 1 "A bill to provide for reconciliation pursuant to Title II of H. Con. Res. 14", commonly referred to as the One Big Beautiful Bill Act (OBBBA). The Company continues to maintain a full valuation allowance on its net deferred tax assets and this new legislation did not have a material impact on the Company.

Tax Receivable Agreement—On the IPO date, NCM, Inc. and the ESA Parties entered into a TRA. Under the terms of this agreement, NCM, Inc. will make cash payments to the ESA Parties in amounts equal to 90% of NCM, Inc.’s actual tax benefit realized from the tax amortization of the intangible assets described below. For purposes of the TRA, cash savings in income and franchise tax will be computed by comparing NCM, Inc.’s actual income and franchise tax liability to the amount of such taxes that NCM, Inc. would have been required to pay had there been no increase in NCM, Inc.’s proportionate share of tax basis in NCM LLC’s tangible and intangible assets and had the TRA not been entered into. The TRA applies to NCM, Inc.’s taxable years up to and including the 30th anniversary date of the offering. For the 2023 tax year, the Company paid the ESA Parties $0.0 million in the year ended December 26, 2024. For the 2024 tax year, the Company paid $1.3 million in 2025 and expects to pay an additional $0.8 million in 2026 to Cinemark. For the 2025 tax year, the Company expects to pay $2.1 million in 2026 to Cinemark.

NCM, Inc. recorded a long-term payable to the ESA Parties related to the TRA. The Company recorded a decrease of $30.2 million and an increase of $4.2 million to the “Payable to ESA Parties under the tax receivable agreement” during the years ended January 1, 2026 and December 26, 2024, respectively. The decrease in the payable under the TRA during the year ended January 1, 2026 was driven primarily by: 1) a decrease of $3.7 million due to differences between the Company's actual and projected performance and future projected performance as recorded within '(Gain) loss on re-measurement of the payable under the tax receivable agreement' on the audited Consolidated Statement of Operations and 2) in accordance with the AMC Termination Agreement, AMC waived all rights and interests as to the TRA and the Company reduced the 'Payable under the TRA' on the audited Consolidated Balance Sheets for the amounts recorded associated with AMC of $24.8 million. The cancellation of this payable was considered akin to a lease incentive related to the modification of the short-term operating lease of AMC's screens under ASC 842—Leases and it was recorded against the intangible asset for the ESA Parties upon the effectiveness of the AMC Termination Agreement within the year ended January 1, 2026. The adjustment will reduce amortization expense of the intangible over the remainder of its useful life, which is considered akin to lease expense. The increase in the payable under the TRA during the year ended December 26, 2024 was driven primarily by a change in calculation methodology to also include forecasted book income for the next two years in addition to the current year, due to management’s ability to more accurately forecast following the conclusion of the COVID-19 pandemic. The increase in the year ended December 28, 2023 was primarily due to the increase in NCM, Inc.’s ownership percentage of NCM LLC. The ownership related changes to the “Payable to ESA Parties under the tax receivable agreement” were recorded within “Additional paid in capital” on the Consolidated Balance Sheet and the non-ownership related changes were recorded within “Non-operating income” within the Consolidated Statements of Operations. For the year ended December 28, 2023, following the Regal Termination Agreement whereby Regal waived all rights and interests as to the TRA, the Company reduced the “Payable under the TRA” on the Consolidated Balance Sheets for the amounts expected to be owed to Regal. This decrease was ultimately offset by the increase in the ‘Payable under the TRA’ on the Consolidated Balance Sheets due to the additional basis created upon the revaluation and reconsolidation of NCM LLC on the Effective Date.

Deferred Tax Assets—Significant components of the Company’s deferred tax assets consisted of the following (in millions):

Carryforwards—As of January 1, 2026, the Company had gross federal net operating loss carryforwards of approximately $235.2 million of which $235.0 million will be carried forward indefinitely. As of January 1, 2026, the Company had gross state net operating loss carryforwards of approximately $216.2 million, of which $157.5 million will expire between 2025 and 2047 and $58.7 million will be carried forward indefinitely. As of January 1, 2026 and December 26, 2024, the Company had gross federal research and experimentation tax credit carryforwards of approximately $1.5 million, which expire at various dates between 2033 and 2039.