NEW YORK ( TheStreet) -- Cinemark ( CNK) shares are gaining more than 2.5% today after the movie theater company and Imax ( IMAX) announced they have resolved their litigation claims against each other. In addition, Cinemark will acquire two new digital Imax theater systems and upgrade all six of its Imax locations to digital theaters.

"Our Imax theaters have always been strong performers," Cinemark CEO Alan Stock said. "By adding two new locations in California and Texas, and by upgrading to digital, we believe our Imax stable of theaters will become even more productive, more profitable and will showcase the biggest and best blockbuster titles that Imax has to offer."

The new theaters and upgrades are expected to be completed by April 2011.

In 2009, Imax and Cinemark launched lawsuits against each other over Imax's XD digital theaters as well as various business practice disputes. Terms of the recent settlement were not disclosed.

"All claims and counterclaims in the patent litigation in Texas and contract litigation in New York are being dismissed with prejudice," Imax said today in a statement.

Cinemark shares are up about 2.5% to above $17.75 today after analyst James Marsh of Piper Jaffray maintained his overweight rating and $22 price target on the stock. He also maintained his overweight rating for Imax shares, with a $30 price target.

"We see the settlement of Imax and Cinemark lawsuits as win-win," Marsh said in his Jan. 4 research note. Through the new deal, Imax has been granted the opportunity to expand its footprint while Cinemark adds to its XD brand with higher grossing screens.

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