I.

Plan Sponsor :

This Long-Term Incentive Plan (“LTIP”) will be sponsored by The Marcus Corporation (the “Company”).

II.

Plan Objectives:

The objectives of the LTIP are to:

•

Reward key employees for their contributions to the longer-term profitability, return and growth of the Company.

•

Focus key employees on the long-term success of the Company and promote retention.

•

Align key employee rewards with shareholder interests.

•

Provide competitive total compensation opportunities.

III.

Effective Date:

This LTIP will become effective as of July 7, 2009 for the Company’s fiscal 2010 year ending May 2010 and for subsequent fiscal years.

IV.

Plan Year:

A plan year will coincide with the Company’s fiscal year (“Plan Year”).

V.

Administration:

This LTIP will be administered by the Compensation Committee of the Company’s Board of Directors (the “Committee”), which reserves the authority to amend, interpret or terminate this LTIP in whole or in part at any time. The Committee may delegate responsibility for this LTIP’s ministerial functions to such officers of the Company as it determines in its sole discretion from time to time.

VI.

Eligibility and Participation:

All employees of the Company who are members of the Company’s Executive Committee are eligible to participate in this LTIP. Participants will be selected annually by the Committee or at such other times as the Committee may determine.

VII.

Grant of LTIP Awards:

Unless determined otherwise by the Committee, each Plan Year, participants selected by the Committee may be granted all or some of the following LTIP awards, which will initially be weighted as described below (or as otherwise determined by the Committee) based on the total LTIP award determined by the Committee to be provided to the participant for that Plan Year:

•

Stock option award – 50% weight

•

Restricted stock award – 10% weight

•

LTI cash award – 40% weight

The stock option and restricted stock grant components of each LTIP award will be made under, and will be subject to all of the terms and conditions of, the Company’s 2004 Equity Incentive Plan. The LTI cash award will be subject to the terms and conditions described herein.

VIII.

LTI Cash Award Terms:

A.

LTI Target Opportunity:

Each participant’s LTI cash award target opportunity will be expressed as either a percentage of the participant’s base salary at the beginning of the performance period, a percentage of a selected financial measure, a fixed dollar amount or a combination thereof, as determined by the Committee.

B.

LTI Cash Award Performance Period:

The performance period for the LTI cash award will initially be a period of three consecutive fiscal years of the Company and is expected to be increased to up to a five-year measurement period in the future, unless otherwise determined by the Committee. The initial performance period for LTI cash awards granted in fiscal 2010 will be fiscal 2010 through fiscal 2012.

C.

LTI Cash Award Opportunity Weighting and Allocation:

LTI cash awards will be earned if either the ROIC goal or the EBITDA goal is achieved for the performance period. Each LTI cash award will be initially weighted 75% ROIC and 25% EBITDA growth rate, or such other weights as the Committee may determine. The goals operate independently – an award will be paid if the ROIC goal is met, even if the EBITDA growth rate goal is not.

D.

Financial Performance Goals:

1.     The initial financial performance goals for the LTI cash award shall be average ROIC and Adjusted EBITDA compound annual growth for the performance period, or such other goals as the Committee may determine.

2.     “ROIC” equals the Company’s income, determined before extraordinary items but reduced by any preferred dividends, divided by the Company’s total invested capital, as determined by the Company’s Chief Financial Officer, subject to confirmation by the Committee. Total invested capital is the sum of the value of the Company’s long-term debt, any preferred stock (carrying value), minority interest (balance sheet) and total common equity.

3.     Average ROIC for the performance period will be determined by averaging the ROIC for each fiscal year of the Company within the performance period.

4.     “Adjusted EBITDA” equals the Company’s operating income before reductions for interest, taxes, depreciation and amortization and preopening expenses, plus any gains or losses from unconsolidated joint ventures, as determined by the Company’s Chief Financial Officer, subject to confirmation by the Committee.

5.     Adjusted EBITDA growth rate for the performance period will be the compound annualized rate of growth of Adjusted EBITDA, measured starting with the Company’s Adjusted EBITDA for the fiscal year prior to the beginning of the performance period and ending with the Company’s Adjusted EBITDA for the last fiscal year of the performance period. For example, for the fiscal 2010 through fiscal 2012 performance period, the growth rate will be calculated based on the compound annualized rate of growth from the end of fiscal 2009 through fiscal 2012, and by using the Company’s Adjusted EBITDA for its fiscal 2009 as the beginning basis for such measurement.

6.     The Compensation Committee retains the ability to consider whether an adjustment of the financial goals for any year within the performance period is necessitated by exceptional circumstances. This ability is intended to be narrowly and infrequently used.

E.

LTI Cash Award Calculation:

1.     The first step in determining a LTI