<PAGE>

                                                                   EXHIBIT 10.51

             GUARANTEE OF LENDER'S OBLIGATIONS UNDER STANDBY CREDIT
                                    AGREEMENT

         GUARANTEE, dated as of October 22, 2003 (this "Guarantee"), from
CITADEL CINEMAS, INC, a Nevada corporation (the "Guarantor"), in favor of SUTTON
HILL CAPITAL, L.L.C., a New York limited liability company (the "Sutton
Capital"), and its successors and assigns.

         WHEREAS, the Guarantor wishes to induce the Sutton Capital to enter
into a new amendment and restatement of a certain Operating Lease (as defined
below) with the Guarantor and to enter into certain related transactions; and

         WHEREAS, the Sutton Hill is unwilling to enter into the amendment and
restatement of the Operating Lease and the related transactions unless the
Guarantor enters into this Guarantee of the obligations of the Lender (as
defined below) which is an Affiliate (as defined below) of the Guarantor to
Sutton Capital under the Standby Credit Agreement (as defined below) and/or the
Intercreditor Agreement (as defined below);

         NOW, THEREFORE, in order to induce Sutton Capital to enter into the new
amendment and restatement of the Operating Lease and the related transactions,
the Guarantor hereby agrees as follows:

                                    SECTION 1

                                  DEFINED TERMS

                              RULES OF CONSTRUCTION

1.1      DEFINITIONS

         As used in this Guarantee, capitalized terms defined in the preamble,
Preliminary Statements and other Sections of this Guarantee shall have the
meanings set forth therein, terms defined in Exhibit A shall have the meanings
set forth therein, and capitalized terms used herein or in Exhibit A but not
otherwise defined herein or in Exhibit A shall, except as otherwise provided in
the Standby Credit Agreement, have the meanings set forth in the Standby Credit
Agreement.

1.2      ACCOUNTING TERMS

         All accounting terms not specifically defined herein shall be construed
in accordance with generally accepted accounting principles.

1.3      USE OF CERTAIN TERMS

         Unless the context of this Guarantee requires otherwise, the plural
includes the singular, the singular includes the plural, and "including" has the
inclusive meaning of "including without

<PAGE>

limitation." The words "hereof," "herein," "hereby," "hereunder," and other
similar terms of this Guarantee refer to this Guarantee as a whole and not
exclusively to any particular provision of this Guarantee. All pronouns and any
variations thereof shall be deemed to refer to masculine, feminine, or neuter,
singular or plural, as the identity of the Person or Persons may require.

1.4      HEADINGS AND REFERENCES

         Section and other headings are for reference only, and shall not affect
the interpretation or meaning of any provision of this Guarantee. Unless
otherwise provided, references to Articles, Sections, Schedules, and Exhibits
shall be deemed references to Articles, Sections, Schedules, and Exhibits of
this Guarantee. References to this Guarantee and any other Operative Document
include this Guarantee and the other Operative Documents as the same may be
modified, amended, restated or supplemented from time to time pursuant to the
provisions hereof or thereof. A reference to any Law shall mean that Law as it
may be amended, modified or supplemented from time to time, and any successor
Law. A reference to a Person includes the successors and assigns of such Person,
but such reference shall not increase, decrease or otherwise modify in any way
the provisions in this Guarantee governing the assignment of rights and
obligations under or the binding effect of any provision of this Guarantee.

                                    SECTION 2

                                    GUARANTEE

2.1      GUARANTEE

         Subject to the terms and conditions in this Guarantee, the Guarantor
absolutely, unconditionally and irrevocably guarantees to Sutton Capital that
the Lender will duly and punctually perform, comply with, and observe all
Obligations as and when required in accordance with the terms thereof and
subject to the conditions thereof, in each case, without regard to whether such
Obligation is direct or indirect, absolute or contingent, now or hereafter
existing or owing, voluntary or involuntary, created or arising by contract,
operation of Law or otherwise, all to the same extent, except as otherwise
specifically provided herein, as if the Guarantor were the Lender under the
Standby Credit Agreement and/or under the Intercreditor Agreement; provided,
however, that the foregoing limitation imposing on the Guarantor obligations
hereunder as if it were the Lender under the Standby Credit Agreement (except as
herein set forth) and/or under the Intercreditor Agreement shall not limit
obligations of the Guarantor hereunder to the extent the limitations (including
termination, disavowal, rejection or reduction) of any such obligation of the
Lender results from an Insolvency or Liquidation Proceeding, and in such event
the Guarantor shall be liable in respect of obligations of the Lender pursuant
to the Standby Credit Agreement and/or under the Intercreditor Agreement as if
no such Insolvency or Liquidation Proceeding had been initiated.

                                    -- 2 --
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2.2      GUARANTEE ABSOLUTE

         Subject to the terms and conditions of the Guarantee, including without
limitation Section 2.7, this Guarantee is an absolute, unlimited and continuing
guaranty of performance and payment (and not of collection) of the Obligations.
This Guarantee is in no way conditioned upon any attempt to collect from the
Lender or upon any other event of contingency, and shall be binding upon and
enforceable against the Guarantor without regard to the validity or
enforceability of any Operative Document, or of any term thereof or obligation
thereunder.

         The obligations of the Guarantor set forth herein constitute full
recourse obligations of the Guarantor enforceable against it to the full extent
of all its assets and properties. Without limiting the foregoing, it is agreed
and understood that repeated and successive demands may be made and recoveries
may be had hereunder as and when, from time to time, the Lender shall be in
default with respect to the Obligations under the terms of the Standby Credit
Agreement and/or the Intercreditor Agreement and that, notwithstanding the
recovery hereunder for or in respect of any given default with respect to the
Obligations by the Lender under the Standby Credit Agreement and/or under the
Intercreditor Agreement, this Guarantee shall remain in full force and effect
said shall apply to each and every subsequent default with respect to the
Obligations; but the foregoing shall not limit rights and remedies under the
Standby Credit Agreement, the Intercreditor Agreement, or the Obligations
hereunder.

2.3      REINSTATEMENT

         In case any Operative Document or obligation thereunder shall be
terminated as a result of the rejection thereof by any trustee, receiver or
liquidating agent of the Lender or any of its properties in any Insolvency or
Liquidation Proceeding, the Guarantor's obligations hereunder shall continue to
the same extent as if such agreement had not been so rejected. The Guarantor
agrees that this Guarantee shall continue to be effective or be reinstated, as
the case may be, if at any time payment to Sutton Capital of the Obligations or
any part thereof is rescinded or must otherwise be returned by Sutton Capital
upon the Insolvency or Liquidation Proceeding, as though such payment to Sutton
Capital had not been made.

2.4      ENFORCEMENT

         The Guarantor shall pay all costs, expenses and damages incurred
(including reasonable attorneys' fees and disbursements) in connection with the
enforcement of the obligations to the extent that such costs, expenses and
damages are not paid by the Lender, said in connection with the enforcement of
the obligations of the Guarantor under this Guarantee.

2.5      RIGHTS OF SETOFF, ETC.

         The obligations of the Guarantor hereunder shall be subject to the same
counterclaims, setoffs, deductions and defenses as would be available to the
Guarantor if the Guarantor were the Lender under the Standby Credit Agreement,
and/or the Intercreditor Agreement. Except as provided in the immediately
preceding sentence, the obligations of the Guarantor hereunder shall not be
subject to any counterclaims, setoffs, deductions or defenses (other than
payment, performance or affirmative discharge, release or termination of this
Guarantee by Sutton Capital) that the Guarantor may have against the Lender or
any other Person, and shall remain in full

                                    -- 3 --
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force and effect without regard to, and shall not be released, discharged,
reduced or in any way affected by any circumstance or condition (whether or not
the Guarantor shall have any knowledge or notice thereof) whatsoever which might
constitute a legal or equitable discharge or defense (except as provided in
Section 4.1(b)) including (a) the amending, modifying, supplementing or
terminating (by operation of law or otherwise), expressly or impliedly, of any
Operative Document, or any other instrument applicable to the Lender or to its
Obligations, or any part thereof; (b) any failure on the part of the Lender to
perform or comply with any term of any Operative Document or any failure of any
other Person (other than Sutton Capital and its Affiliates, to the extent such
failure constitutes a defense to performance by the lender under the Standby
Credit Agreement of its obligations thereunder) to perform or comply with any
term of any Operative Document; (c) any waiver, consent, change, extension,
indulgence or other action or any action or inaction under or in respect of any
Operative Document or this Guarantee (except for any written waiver or
modification of the provisions of this Guarantee signed by the parties hereto),
whether or not Sutton Capital, the Lender or the Guarantor has notice or
knowledge of any of the foregoing; (d) any Insolvency or Liquidation Proceeding
or any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding with respect to the Guarantor or
its properties, or any action taken by any trustee or receiver or by any court
in any such proceeding; (e) any furnishing or acceptance of additional or
substitute security or any release (whether for valuable consideration or
otherwise) of any security (and the Guarantor authorizes Sutton Capital to
furnish, accept or release said security); (f) any limitation on the liability
or Obligations of the Lender under any Operative Document (except as expressly
set forth therein) or any termination (by operation of law or otherwise),
cancellation (by operation of law or otherwise), frustration or
unenforceability, in whole or in part, of any Operative Document, or any term
thereof or Obligation thereunder, except to the extent my such limitation,
termination, cancellation, frustration or unenforceability arises in favor of
the Lender thereunder based on circumstances, conditions or events which would
have limited, terminated, cancelled, frustrated or rendered unenforceable the
obligations of the Guarantor, if the Guarantor had been the lender under the
Standby Credit Agreement; (g) any lien, charge or encumbrance on or affecting
the Guarantor's or the Lender's respective assets and properties; (h) any act,
omission or breach on the part of Sutton Capital or any Assignee under any
Operative Document, or my other agreement at any time existing between Sutton
Capital and the Lender or any other Law or other agreement applicable to Sutton
Capital or any Obligation, except to the extent such act, omission or breach
would have resulted in the limitation or termination of any liability of the
Guarantor if the Guarantor had been the Lender under the Standby Credit
Agreement and/or the Intercreditor Agreement; (i) any claim as a result of any
other dealings among Sutton Capital and the Guarantor, except to the extent such
act, omission or breach would have resulted in the limitation or termination of
any liability of the Guarantor if the Guarantor had been the Lender under the
Standby Credit Agreement and/or the Intercreditor Agreement; (j) the assignment
or transfer of this Guarantee, any Operative Document (in accordance with and
subject to the terms thereof) or any other agreement or instrument referred to
in any Operative Document or applicable to the Lender or the Obligations by
Sutton Capital to any other Person; (k) any change in the name of Sutton
Capital, the Lender or my other Person referred to herein; (l) any merger or
consolidation of the Lender or the Guarantor into or with any other Person or
any sale, lease or transfer of any other assets of the Lender or the Guarantor
to any other Person, whether or not permitted pursuant to the terms of the
Operative Documents; (m) the availability to Sutton Capital of claims against
other parties

                                    -- 4 --
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with respect to the Obligations (whether or not such parties are then solvent)
or the release of any or all of such claims (whether for valuable consideration
or otherwise); or (n) any change in the ownership of any shares of capital stock
of or other evidences of equity interests in the Guarantor or the Lender
(including any such change which results in the Lender no longer owning capital
stock of, or any such interests in, the Guarantor), whether or not permitted
pursuant to the terms of the Operative Documents; provided, however, that,
notwithstanding the foregoing, this Guarantee shall not constitute a waiver or
release by the Lender or the Guarantor of any claim of the Lender or the
Guarantor which may be asserted against Sutton Capital or any other party in a
separate action or proceeding, or if required by applicable Law as a compulsory
counterclaim in such action.

2.6      WAIVER

         The Guarantor unconditionally waives: (a) notice of any of the matters
referred to in Section 2.5 hereof; (b) all notices which may be required by
statute, rule of law or otherwise to preserve any rights against the Guarantor
hereunder, including notice of the acceptance of this Guarantee by Sutton
Capital, or the creation, renewal, extension, modification or accrual of the
Obligations or notice of any other matters relating thereto, any presentment,
demand, notice of dishonor, protest or nonpayment of any damages or other
amounts payable under any Operative Document; (c) any requirement for the
enforcement, assertion or exercise of any right, remedy, power or privilege
under or in respect of any Operative Document, including diligence in collection
or protection of or realization upon the Obligations or any part thereof or any
collateral therefor; (d) any requirement of diligence; (e) any requirement to
mitigate the damages resulting from a default under any Operative Document,
except that this shall not relieve Sutton Capital of any such obligation if and
to the extent required by the terms of the Operative Documents or required by
Law; (f) the occurrence of every other condition precedent to which the
Guarantor or the Lender may otherwise be entitled, except as provided in any
Operative Document; and (g) the right to require Sutton Capital to proceed
against the Lender or any other Person liable on the Obligations, to proceed
against or exhaust security held from the Lender or any other Person, or to
pursue any other remedy in Sutton Capital's power whatsoever, and the Guarantor
waives the right to have the property of the Lender first applied to the
discharge of the Obligations.

          Sutton Capital may, at its election, exercise any right or remedy it
might have against the Lender or any security held by Sutton Capital, including
the right to foreclose upon any such security by judicial or nonjudicial sale,
without affecting or impairing in any way the liability of the Guarantor
hereunder, except to the extent the Obligations have been indefeasibly paid or
satisfied, and the Guarantor waives any defense arising out of the absence,
impairment or loss of any right of reimbursement, contribution or subrogation or
any other right or remedy of the Guarantor against the Lender or any such
security, whether resulting from such election by Sutton Capital or otherwise.
Except to the extent provided in the first sentence of Section 2.5 hereof, the
Guarantor waives any defense arising by reason of any disability or other
defense of the Lender (which may nevertheless be asserted in a separate action
or proceeding against Sutton Capital or any other party), or by reason of the
cessation of the liability, either in whole or in part, of the Lender to the
Obligations (other than as a result of payment, performance or affirmative
discharge, release or termination of this Guarantee by Sutton Capital).

                                    -- 5 --
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2.7      LIMITATIONS ON AMOUNT AND DURATION OF THIS GUARANTEE

         Notwithstanding anything herein to the contrary, the Guarantor's total
obligations and liabilities of any nature under this Guarantee shall in no event
exceed thirteen million dollars ($13,000,000) in the aggregate. All obligations
and liabilities of any nature under this Guarantee shall terminate as of the
Termination Date.

2.8      PLEDGE AGREEMENT

         This Guarantee is secured by a Pledge Agreement entered into on the
date hereof by Guarantor as pledgor and Sutton Capital as pledgee.

                                    SECTION 3

                          REPRESENTATIONS & WARRANTIES

         The Guarantor represents and warrants to Sutton Capital that the
following statements are true and correct in all material respects:

3.1      CORPORATE EXISTENCE; COMPLIANCE WITH LAW.

         The Guarantor (a) has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Nevada, and (b)
has full power, authority and legal right to own and operate its properties and
to conduct its business as presently conducted.

3.2      OWNERSHIP OF GUARANTOR

         All of the Guarantor's common stock is owned beneficially and of record
by the Lender or a Subsidiary of Lender.

                                    SECTION 4

                                  MISCELLANEOUS

4.1      PARTIES.

         (a) This Guarantee shall inure to the benefit of Sutton Capital and its
successors, assigns or transferees, and shall be binding upon the Guarantor and
its successors and assigns. Except as provided in Section 4.1(b), the Guarantor
may not delegate any of its duties under this Guarantee without the prior
written consent of Sutton Capital. Upon notice to the Guarantor, Sutton Capital
and its successors, assigns and transferees may assign its or their rights and
benefits under this Guarantee to (i) any financial institutions providing
financing to Sutton Capital in connection with the Property or Equipment or any
trustee for such financial institutions, and (ii) any purchaser or transferee of
all or a substantial portion of the rights and

                                    -- 6 --
<PAGE>

interests of Sutton Capital and its successors, assigns or transferees in and to
the Theatre Properties and Equipment.

         (b) If in connection with a Business Sale (i) either (A) the Lender
shall assign to any Person the Lender's obligations under the Standby Credit
Agreement or (B) the Lender shall transfer the capital stock of the Guarantor to
any Person which is not an Affiliate of the Lender (whether by transfer of the
stock of the Guarantor or any Subsidiary of the Lender which owns such stock, by
merger of the Lender or any such Subsidiary of the Lender, or otherwise), and
(ii) a Suitable Replacement either assumes the Lender's obligations under the
Standby Credit Agreement or executes and delivers to Sutton Capital a Guarantee
substantially similar to this Guarantee (subject to such modifications as may be
reasonably acceptable to Sutton Capital), this Guarantee shall be terminated and
the Guarantor shall have no further liability hereunder with respect to
Obligations thereafter arising.

4.2      NOTICES.

         All notices, offers, acceptances, approvals, waivers, requests, demands
and other communications hereunder shall be in writing, shall be addressed as
provided below and shall be considered as properly given (a) if delivered in
person, (b) if sent by express courier service (including Federal Express,
Emery, DHL, Airborne Express, and other similar express delivery services), (c)
in the event overnight delivery services are not readily available, if mailed
through the United States Postal Service, postage prepaid, registered or
certified with return receipt requested, or (d) if sent by telecopy and
confirmed; provided, that in the case of a notice by telecopy, the sender shall
in addition confirm such notice by writing sent in the manner specified in
clauses (a), (b) or (c) of this Section 4.2. All notices shall be effective upon
receipt by the addressee; provided, however, that if any notice is tendered to
an addressee and the delivery thereof is refused by such addressee, such notice
shall be effective upon such tender. For the purposes of notice, the addresses
of the parties shall be as set forth below; provided, however, that any party
shall have the right to change its address for notice hereunder to any other
location by giving written notice to the other party in the manner set forth
herein. The initial addresses of the parties hereto are as follows:

                  If to Sutton Capital:

                           Sutton Capital, L.L.C.
                           120 North Robertson Blvd.
                           Los Angeles, California 90048
                           Attention: Ira Levin
                           Telecopier: (310) 855-8416

                  If to the Guarantor:

                           Citadel Cinemas, Inc.
                           c/o Reading International, Inc.
                           550 South Hope Street
                           Suite 1825
                           Los Angeles, California 90071

                                    -- 7 --
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                           Attention: Chief Financial Officer
                           Telecopier: (213) 239-0548

4.3      REMEDIES.

         The Guarantor stipulates that the remedies at law in respect of any
default or threatened default by the Guarantor in the performance of or
compliance with any of the terms of this Guarantee are not and will not be
adequate, and that any of such terms may be specifically enforced by a decree
for specific performance or by an injunction against violation of any such terms
or otherwise, in each case to the same extent as if the Guarantor were the
Lender under the Standby Credit Agreement and/or the Intercreditor Agreement
subject to the proviso in Section 2.1 hereof.

4.4      RIGHT TO DEAL WITH THE LENDER.

         At any time and from time to time, without terminating, affecting or
impairing the validity of this Guarantee or the obligations of the Guarantor
hereunder, Sutton Capital may deal with the Lender in the same manner and as
fully and as if this Guarantee did not exist and shall be entitled, among other
things, to grant the Lender, without notice or demand and without affecting the
Guarantor's liability hereunder, such extension or extensions of time to
perform, renew, compromise, accelerate or otherwise change the time for
performance of or otherwise change the terms of performance or any part thereof
contained in or arising under any Operative Document, or to waive any Obligation
of the Lender to perform any act or acts as Sutton Capital may deem advisable.

4.5      SUBROGATION.

         The Guarantor will not exercise any rights which it may acquire by way
of subrogation hereunder, by any payment made hereunder or otherwise, until the
Termination Date. If any amount shall be paid to the Guarantor on account of
such subrogation rights at any time prior to the Termination Date, such amount
shall be held in trust for the benefit of Sutton Capital and shall forthwith be
credited and applied upon the Obligations, whether matured or unmatured, in
accordance with the terms of the Operative Documents. If (a) the Guarantor shall
make payment to Sutton Capital or any successor, assignee or transferee of
Sutton Capital of all or any part of the Obligations and (b)the Termination Date
occurs, Sutton Capital or any such successor, assignee or transferee of Sutton
Capital will, at the Guarantor's request and expense, execute and deliver to the
Guarantor appropriate documents necessary to evidence the transfer by
subrogation to the Guarantor of an interest in the Obligations resulting from
such payment by the Guarantor.

4.6      SURVIVAL OF REPRESENTATIONS, WARRANTIES, ETC.

         All representations, warranties, covenants and agreements made herein
and in statements or certificates delivered pursuant hereto shall survive any
investigation or inspection made by or on behalf of Sutton Capital and shall
continue in full force and effect until the Termination Date.

                                    -- 8 --
<PAGE>

4.7      GOVERNING LAW.

         THIS GUARANTEE HAS BEEN EXECUTED AND DELIVERED IN THE STATE OF NEW
YORK. THE GUARANTOR AND SUTTON CAPITAL AGREE THAT, TO THE MAXIMUM EXTENT
PERMITTED BY THE LAWS OF THE STATE OF NEW YORK, THIS GUARANTEE, AND THE RIGHTS
AND DUTIES OF THE GUARANTOR AND SUTTON CAPITAL HEREUNDER, SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING,
WITHOUT LIMITATION, SECTIONS 51401 AND 51402 OF THE NEW YORK GENERAL OBLIGATIONS
LAW) IN ALL RESPECTS, IN RESPECT OF ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE.

4.8      CONSENT TO JURISDICTION.

         THE GUARANTOR HEREBY IRREVOCABLY SUBMITS, FOR ITSELF AND ITS
PROPERTIES, THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK AND THE SUPREME COURT OF THE STATE OF NEW YORK IN
THE COUNTY OF NEW YORK IN ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND
RELATED TO OR IN CONNECTION WITH THIS GUARANTEE, AND TO THE EXTENT PRMITTED BY
APPLICABLE LAW, THE GUARANTOR HEREBY WAIVES AND AGREES NOT TO ASSERT BY WAY OF
MOTION, AS A DEFENSE OR OTHERWISE IN ANY SUCH SUIT, ACTION OR PROCEEDING, ANY
CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF SUCH COURT, THAT
THE SUIT, ACTINO OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM, THAT THE
VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER, OR THAT THIS GUARANTEE OR
THE SUBJECT MATTER HEREOF MAY NOT BE LITIGATED IN OR BY SUCH COURT. THIS
SUBMISSION TO JURISDICTION IS NONEXCLUSIVE AND DOES NOT PRECLUDE SUTTON CAPITAL
OR ANY ASSIGNEE FROM OBTAINING JURISDICTION OVER THE GUARANTOR IN ANY COURT
OTHERWISE HAVING JURISDICTION.

4.9      WAIVER OF JURY TRIAL.

         TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE GUARANTOR AGREES NOT TO
SEEK AND HEREBY WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY SUCH COURT
BY ANY COURT OF ANY OTHER NATION OR JURISDICTION WHICH MAY BE CALLED UPON TO
GRANT AN ENFORCEMENT OF SUCH JUDGMENT. THE GUARANTOR AGREES THAT SERVICE OF
PROCESS MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR
NOTICES SET FORTH IN THIS GUARANTEE OR ANY METHOD AUTHORIZED BY THE LAWS OF NEW
YORK.

         THE GUARANTOR AND SUTTON CAPITAL EXPRESSLY WAIVE ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM RELATED TO THIS GUARANTEE. THE
GUARANTOR AND SUTTON CAPITAL ACKNOWLEDGE THAT THE PROVISIONS OF SECTIONS 4.7,
4.8 AND 4.9 HAVE

                                    -- 9 --
<PAGE>

BEEN BARGAINED FOR AND THAT THEY HAVE BEEN REPRESENTED BY COUNSEL IN CONNECTION
THEREWITH.

4.10     SEVERABILITY.

         If any term of this Guarantee or any application thereof shall be
invalid or unenforceable, the remainder of this Guarantee and any other
application of such term shall not be affected thereby. Any term of this
Guarantee may be amended, modified, waived, discharged or terminated only by an
instrument in writing signed by the Guarantor and Sutton Capital.

4.11     COUNTERPARTS.

         This Guarantee may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument.

4.12     NO WAIVER.

         No delay on the part of Sutton Capital in exercising any power or right
hereunder or under any Operative Document shall operate as a waiver thereof; nor
shall any single or partial exercise of any power or right hereunder or the
failure to exercise same in any instance preclude other or further exercise
thereof or the exercise of any other power or right; nor shall Sutton Capital be
liable for exercising or failing to exercise any such power or right; the rights
and remedies hereunder expressly specified are cumulative and not exclusive of
any rights or remedies which Sutton Capital may or will otherwise have. The
Guarantor hereby agrees and acknowledges that to the extent in any instance
claims under this Guarantee consist of claims for the payment of money only,
Sutton Capital, at its sold option, shall have the right to bring a motion or
proceeding under New York State Civil Practice Law and Rules Section 3213.

4.13     LIMITATIONS.

         In no event shall the Guarantor have any liability to Sutton Capital
hereunder for any lost or prospective profits or any other special, punitive,
exemplary, consequential, incidental or indirect losses or damages (in tort,
contract or otherwise).

                            [Signature page follows]

                                    -- 10 --
<PAGE>

         IN WITNESS WHEREOF, the undersigned have caused this Guarantee to be
executed and delivered as of the day and year first above written.

                                          GUARANTOR

                                          CITADEL CINEMAS, INC.

                                          By: /s/ S. Craig Tompkins
                                              ------------------------------
                                              Name: S. Craig Tompkins
                                               Title: Vice Chairman

Acknowledged and Agreed:

SUTTON CAPITAL

SUTTON HILL CAPITAL, L.L.C.

By: /s/ James D. Vandever
    ---------------------------------
    Name: James D. Vandever
    Title: Manager

                                    -- 11 --
<PAGE>


                                    EXHIBIT A

                                  DEFINED TERMS

         "Affiliate" of any Person means any other Person controlling,
controlled by or under direct or indirect common control with such Person. For
the purposes of this definition, "control," when used with respect to any
specified Person, means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have the meanings correlative to the foregoing. Notwithstanding the
foregoing: (a) Sutton Capital and its Affiliates (the "Sutton Capital's
Affiliates") shall not include the Guarantor and Lender and its Subsidiaries;
and (b) the Guarantor and Lender and its Subsidiaries (including the Guarantor),
on the one hand, and Sutton Capital and Sutton Capital's Affiliates, on the
other hand, shall not be considered Affiliates of each other.

         "Business Sale" has the meaning set forth in the Operating Lease.

         "Insolvency or Liquidation Proceeding" means:

                  (a) The entry of a decree or order for relief in respect of
         the Lender by a court having jurisdiction in the premises, or the
         appointment of a receiver, liquidator, assignee, custodian, trustee,
         sequestrator (or other similar official) of the Lender or of any
         substantial part of its property, or ordering the winding up or
         liquidation of its affairs, in an involuntary case under the Federal
         bankruptcy laws, as now or hereafter constituted, or any other
         applicable Federal or state bankruptcy, insolvency or other similar
         law; or the commencement against the Lender of an involuntary case
         under the Federal bankruptcy laws, as now or hereafter constituted, or
         any other applicable Federal or state bankruptcy, insolvency or other
         similar law; or

                  (b) The commencement by the Lender of a voluntary case under
         the Federal bankruptcy laws, as now or hereafter constituted, or any
         other applicable Federal or state bankruptcy, insolvency or other
         similar law, or the consent by it to the entry of an order for relief
         in an involuntary case under any such law or the consent by it to the
         appointment of or taking possession by a receiver, liquidator,
         assignee, custodian, trustee, sequestrator (or other similar official)
         of the Lender or of any substantial part of its property, or the making
         by it of a general assignment for the benefit of creditors, or the
         taking of any action in furtherance of any of the foregoing.

          "Intercreditor Agreement" means the Amended and Restated Intercreditor
Agreement dated as of July 28, 2000 as amended and restated as of January 29,
2002 as further amended and restated as of even date herewith between Sutton
Hill Capital, Reading International, Inc. and Nationwide Theatres Corp., as the
same may be amended, restated, modified, or supplemented from time to time.

         "Law" shall mean any law (including, without limitation, any
environmental Law), treaty, statute, rule, regulation, ordinance, order,
directive, code, interpretation, judgment, decree, injunction, writ,
determination, award, permit, license, authorization, direction, requirement or

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<PAGE>


decision of or agreement with or by any governmental or governmental department,
commission, board, court, authority, agency, official or officer having
jurisdiction of the matter in question.

         "Lender" means Reading International, Inc. in its capacity as Lender
under the Standby Credit Agreement, and in its capacity as a party to the
Intercreditor Agreement, and, in each case, its successors and assigns.

         "Mortgage" means that certain first mortgage of even date herewith
securing the Note.

         "Note" means that certain purchase money promissory note of even date
herewith between Purchaser as payor and Guarantor as payee.

         "Obligations" means all obligations, covenants, and undertakings of
Reading International, Inc. contained in the Operative Documents.

         "Omnibus Agreement" means that certain Omnibus Amendment Agreement
dated as of even date herewith by and among Lender, Guarantor, Sutton Capital,
Sutton Hill Associates and Nationwide Theater Corp.

         "Operating Lease" means the Amended and Restated Operating Lease
Agreement dated as of July 28, 2000 as amended and restated as of January 29,
2002 and as further amended and restated as of even date herewith between Sutton
Hill Capital, L.L.C., as Lessor, and Citadel Cinemas, Inc., as Lessee, as the
same may be amended, restated, modified or supplemented from time to time.

         "Operative Documents" means the Standby Credit Agreement and each
agreement, certificate or instrument delivered by the Lender pursuant to the
terms of the Standby Credit Agreement, the Intercreditor Agreement and each
agreement, certificate or instrument delivered by the Lender pursuant to the
terms of the Intercreditor Agreement.

          "Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, limited liability company,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.

         "Purchaser" means collectively 205-209 East 57th Street Associates,
LLC, its successors and assigns, including any title holding nominee that it may
designate to hold title to the Sutton Property (as such term is defined in the
Omnibus Agreement).

         "Standby Credit Agreement" means the Amended and Restated Standby
Credit Agreement dated as of July 28, 2000, as amended and restated as of
January 29, 2002, as further amended and restated as of even date herewith
between Sutton Hill Capital, L.L.C. as Borrower and Reading International, Inc.
as Lender, as the same may be amended, restated, modified or supplemented from
time to time.

         "Subsidiary" of any Person means any corporation, partnership, limited
liability company, joint venture, trust or estate of which (or in which) more
than 50% of:

                                    -- A-2 --
<PAGE>

                  (a)      the outstanding capital stock having voting power to
         elect a majority of the board of directors of such corporation
         (irrespective of whether at the time capital stock of any other class
         or classes of such corporation shall or might have voting power upon
         the occurrence of any contingency);

                  (b)      the interest in the capital or profits of such
         partnership or joint venture; or

                  (c)      the beneficial interest of such trust or estate

is at the time directly or indirectly owned by such Person, by such Person and
one or more of its Subsidiaries or by one or more of such Person's Subsidiaries.

         "Suitable Replacement" has the meaning set forth in the Operating
Lease.

         "Termination Date" has the meaning set forth in the Omnibus Agreement.

                                    -- A-3 --