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                             AMC ENTERTAINMENT INC.
                         106 W. 14th Street, Suite 2000
                           Kansas City, Missouri 64105

                                December 6, 2001
                  (Amended and restated as of January 28, 2002)

GC Companies, Inc.
1300 Boylston Street
Chestnut Hill, Massachusetts 02467

Attn:   G. Gail Edwards
        President and Chief Operating Officer

Dear Ms. Edwards:

      This amended and restated letter of intent ("Letter") supercedes and
replaces that certain letter of intent dated December 6, 2001, as amended as of
January 15, 2001. The purpose of this Letter is to set forth certain non-binding
understandings and certain binding agreements between AMC Entertainment Inc., a
Delaware corporation ("AMCE" or "we"), and GC Companies, Inc., a Delaware
corporation ("GCX" or "you"), and its affiliated debtors and debtors in
possession (collectively, the "GCX Debtors") in cases under chapter 11 of the
United States Bankruptcy Code that are currently pending the United States
Bankruptcy Court for the District of Delaware (the "Court") as case nos. 00-3897
(EIK) to 00-3927 (EIK) (the "Chapter 11 Cases"), with respect to AMCE's
acquisition of newly issued shares of GCX common stock ("New GCX Stock"),
representing 100% of the outstanding capital stock of GCX as reorganized
pursuant to a plan of reorganization in form and substance reasonably
satisfactory to AMCE in the good faith exercise of its discretion that (i) is in
all respects consistent with this Letter and the Term Sheet (as defined below),
(ii) does not impose on AMCE any liabilities or obligations in addition to or
other than those provided in this Letter, the Agreement (as defined below) and
the Term Sheet and (iii) contains such other provisions that AMCE reasonably
deems necessary to protect AMCE (the "Plan"), on the terms and conditions
described in this Letter (collectively, the "Proposed Transaction").

      Section 1 reflects our understanding with respect to the matters described
in them, but are not to constitute a complete statement of, or a legally binding
or enforceable agreement or commitment on the part of, AMCE or the GCX Debtors
with respect to the matters described therein.

      1.    PURCHASE OF GCX AND SUBSIDIARIES.

      (a)   On the terms and subject to the conditions (which will be
            substantially in accordance with this Letter and the Term Sheet) set
            forth in (A) that certain Stock Purchase Agreement dated January 15,
            2002 (as may be amended, the "Agreement") among GCX, AMCE, American
            Multi-
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            Cinema, Inc. ("AMC") and Centertainment Development, Inc. ("CDI"), a
            copy of which is attached hereto as Exhibit II, and (B) the Plan
            (collectively, the "Transaction Documents"), AMCE intends to acquire
            substantially all of the assets, properties and business (the "GCX
            Business and Assets") of GCX and its subsidiaries through (i) AMC's
            acquisition of the New GCX Stock on the effective date of the Plan
            (the "Effective Date"), (ii) CDI's acquisition of all of the stock
            of General Cinema International, Inc., and (iii) CDI's acquisition
            of all of the stock of reorganized GCC Investments, Inc.

      (b)   The Transaction Documents will or do provide that, at the Effective
            Date, the consideration specified in the Term Sheet for the
            acquisition of GCX by AMCE attached hereto as Exhibit I (the "Term
            Sheet") will be issued to or for the benefit of the claimants and
            equity holders in the Chapter 11 Cases as provided in the Plan.

      (c)   The Transaction Documents will or do provide that, at the Effective
            Date, the lessee of each of the domestic theatre leases that is
            assumed under the Plan shall be a single domestic operating
            corporation named "General Cinema Theatres, Inc." ("Reorganized
            GCT") that will be a wholly-owned subsidiary of Reorganized GCX,
            except (i) as otherwise determined by AMCE in its sole discretion or
            (ii) to the extent any such lease is assigned to Reorganized GCT, if
            the counterparty to such a contract or lease objects to such
            assignment and the Court does not approve such assignment (in which
            case the lessee will be the existing GCX Debtor that is lessee under
            such lease).

      (d)   The Transaction Documents will or do provide that, to the extent
            that on the Effective Date GCX has insufficient cash to repay GCX's
            debtor-in possession credit facility in full and to pay any unpaid
            "Deduction Claims" (as defined in the Term Sheet), AMCE will fund
            the shortfall. AMCE also will provide GCX, for presentation to the
            Court at the Plan confirmation hearing, evidence to support a
            finding by the Court that the working capital feasibility
            requirements for the Plan under Section 1129(a)(11) of the
            Bankruptcy Code are met.

      2.    [OMITTED]

      3. BINDING AGREEMENTS. Upon execution of counterparts of this Letter by
you, the following lettered paragraphs of this Section 3 will constitute the
legally binding and enforceable agreement of AMCE and GCX (in recognition of the
significant costs to be borne by AMCE and GCX in pursuing this transaction and
further in consideration of their mutual undertakings as to the matters
described herein).

            (a) Access. Subject to the terms set forth in paragraph (j) below
respecting confidentiality and certain other matters, GCX, on reasonable notice,
will


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afford AMCE's employees, auditors, legal counsel and other authorized
representatives all reasonable opportunity and access during normal business
hours to inspect, investigate and audit in a reasonable manner the GC Business
and Assets and to meet with GCX personnel before the Effective Date.

            (b) Consents. AMCE and GCX will cooperate with one another and
proceed, as promptly as is reasonably practicable, to seek to obtain all
necessary material consents and approvals from governmental bodies, lenders,
landlords and third parties necessary to consummate the Proposed Transaction,
and to endeavor to comply with all other legal or contractual requirements for
or preconditions to the execution and consummation of the Transaction Documents
and the Proposed Transaction. Without limiting the generality of the foregoing,
GCX and AMCE shall file premerger notification under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the "HSR Filing"), as soon as
reasonably practicable after execution of this Letter, but in any event prior to
the earlier to occur of (i) five (5) days following Court approval of this
Letter and the IOA, or (ii) January 28, 2002.

            (c) [Omitted].

            (d) Bankruptcy Process. AMCE, GCX and the Committee of Unsecured
Creditors in the Chapter 11 Cases (the "Committee") will cooperate in the
preparation of the Plan, the disclosure statement therefor (the "Disclosure
Statement"), the forms of ballots, solicitation procedures and Plan related
procedures (collectively, the "Plan Procedures") and will use commercially
reasonable efforts (which shall not be interpreted to require AMCE or GCX to pay
any amount other its own attorneys' fees) to obtain Court approval and
confirmation of the Agreement, Plan, Disclosure Statement and Plan Procedures
and to implement the Plan in accordance with the following schedule:

            (i)   [Omitted].

            (ii)  The Plan and Disclosure Statement were filed with the Court on
                  or before December 21, 2001 and the Plan Procedures were filed
                  on or before January 10, 2002.

            (iii) A Court order approving the adequacy of the Disclosure
                  Statement shall have been entered on or before February 25,
                  2002.

            (iv)  The applicable waiting period for the HSR Filing shall have
                  expired or been terminated early, without the initiation of
                  any enforcement action and without the imposition of any
                  conditions on the Proposed Transaction by the Federal Trade
                  Commission or the Antitrust Division of the Department of
                  Justice, not less than five (5) days prior to the confirmation
                  hearing for the Plan.


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            (v)   A Court order confirming the Plan (the "Confirmation Order")
                  shall have been entered on or before March 20, 2002.

            (vi)  The Confirmation Order shall have become a final,
                  nonappealable order on or before April 1, 2002.

            If AMCE is not in breach of its obligations under this Letter, AMCE
may extend any of the dates set forth in any or all of clauses (i) through (vi)
above, inclusive, for a period of up to thirty days, by giving written notice of
such election to GCX and the Principal Claimants (as defined below) on or before
the applicable date being extended. If GCX is not in breach of its obligations
under this Letter, GCX and the Committee may jointly extend any of the dates set
forth in any or all of clauses (i) through (vi) above, inclusive, for a period
of up to thirty days, by giving written notice of such election to AMCE and the
Principal Claimants (as defined below) on or before the applicable date being
extended.

            (e) Exclusivity. GCX acknowledges that AMCE has expended and will
continue to expend considerable time and money in developing the Proposed
Transaction, which it is not prepared to continue expending, however, except
upon the terms hereof, including the provisions of this paragraph (e).

            (i)   Nonsolicitation. Neither GCX nor any of its respective
                  directors, employees, accountants or other agents and
                  representatives (collectively, "Representatives") shall,
                  directly or indirectly, solicit a competitive bid or proposal
                  from a third party to purchase all or any portion of the GCX
                  Business and Assets or the New GCX Stock, whether in a
                  separate transaction or as part of a plan of reorganization
                  for GCX (a "Third Party Plan"), or engage in or continue any
                  discussions or negotiations with any party that has made or
                  who may make such a competitive bid for such New GCX Stock or
                  the Assets.

            (ii)  Unsolicited Proposals. Notwithstanding subparagraph (i), GCX
                  may consider an unsolicited Third Party Plan if and only if
                  the Court finds that (A) the Third Party Plan would provide
                  for a material increase in the aggregate value of the
                  consideration being paid for all of the GCX Business and
                  Assets compared to the Plan, (B) the Third Party Plan is
                  fully-financed and the third party is otherwise capable of
                  performing its obligations thereunder, and (C) GCX may
                  consider the Third Party Plan.

            (iii) Support Agreements. GCX acknowledges that certain claimants
                  and parties in interest in the Chapter 11 Cases, to wit:
                  General Electric Capital Corporation, Harcourt General, Inc.
                  and the Committee (collectively, the "Principal Claimants"),
                  have entered into support agreements with AMCE with respect to
                  the Plan (the


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                  "Support Agreements") that obligate the Principal Claimants to
                  support the Plan and prevent the Principal Claimants from
                  supporting a Third Party Plan, subject to the terms and
                  conditions of the Support Agreements.

            (f) Termination. This Letter may be terminated (A) by AMCE, at
AMCE's sole discretion, promptly following the passing of the applicable
deadline upon written notice to GCX and the Principal Claimants if, through no
material fault of AMCE, any event specified to occur as of a certain date in
paragraph (d) above has not occurred as of such date, including any extensions,
or (B) by the non-breaching party due to material breach of this Letter by the
other party if the breaching party does not cure such breach within thirty (30)
days after written notice from the non-breaching party. Without limiting the
foregoing, any breach by GCX of clause (i) or (ii) of paragraph (e) shall be a
material breach of this Letter. Upon any such termination, any obligations under
this Letter will terminate and no party shall have any liability whatsoever to
any other party; provided, however, that nothing in this Letter shall limit the
availability of any equitable remedies, including specific performance,
available to AMCE upon GCX's breach of this Letter, the IOA or the Agreement.

            (g) Costs. AMCE and GCX will each be solely responsible for and bear
all of its own respective expenses, including expenses of legal counsel,
accountants and other advisers, incurred at any time in connection with pursuing
or consummating the Proposed Transaction.

            (h) Miscellaneous. The terms set forth in this Letter are a part of
a comprehensive agreement, each element of which is an integral aspect of the
Proposed Transaction and, as such, are non-severable. Headings are for reference
only and do not constitute part of this Letter. The words "includes" and
"including" shall not be words of limitation and shall be read to also add
"without limitation." This Letter shall be governed by and construed in
accordance with the internal laws of the State of New York and any applicable
provision of the Bankruptcy Code, without regard to the principles of conflict
of laws that would provide for application of another law. Each of the parties
acknowledges and agrees that no failure or delay in exercising any right, power
or privilege hereunder will operate as a waiver thereof, nor will any single or
partial exercise thereof preclude any other right, power or privilege hereunder.
This Letter may be executed in counterparts, each of which when taken together
shall constitute an original of this Letter. It is understood that this Letter
does not contain all matters upon which agreement must be reached in order for
the Proposed Transaction to be consummated; however, the provisions of Section 3
of this Letter, are acknowledged and agreed to be fully binding on the parties
hereto.

            (i) Public Disclosure. AMCE and GCX may provide copies of this
Letter and attachments to parties in interest in the Chapter 11 Cases and as
otherwise necessary in connection with the Chapter 11 Cases. AMCE and GCX also
shall be entitled to file copies of this Letter with the Court, the Securities
and Exchange Commission, the HSR Filing and any exchange upon which AMCE's or
GCX's


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securities are traded, and as otherwise required by law. Subject to the
foregoing, neither AMCE nor GCX shall make any public release of information
regarding the matters contemplated herein except (i) that simultaneous press
releases in the form approved by AMCE and GCX in writing by fax or by E-mail
shall be issued by each of AMCE and GCX as promptly as is practicable after the
execution of this Letter and at such other times as may be set forth in the
Agreement, (ii) AMCE may issue one or more press releases to the effect that it
has entered into support agreements with other creditors of the GCX Debtors,
after consultation with GCX, and (iii) that AMCE and GCX may each continue such
communications with employees, customers, suppliers, franchisees, lenders,
lessors, shareholders, and other particular groups as may be legally required or
necessary or appropriate and not inconsistent with the best interests of the
other party or the prompt consummation of the transactions contemplated by this
Letter, and (iii) as required by law, the Court, with the Securities and
Exchange Commission, the HSR Filing and any exchange upon which AMCE's or GCX's
securities are traded.

            (j) Confidentiality. AMCE agrees that, except as provided in this
Letter, that certain letter agreement respecting confidentiality and
nondisclosure dated June 29, 2001 between GCX and AMCE shall remain in effect.
The provisions of this paragraph (j) shall survive the termination of this
Letter.

            (k) Other Plan Provisions. The Plan shall contain customary release
provisions with respect to directors, officers and employees of the GCX Debtors,
preserve any pre-petition claims of directors, officers and employees of the GCX
Debtors to the extent of coverage therefor under GCX's existing Directors and
Officers Insurance Policy ("D&O Policy") and preserve the rights of the current
GCX directors and officers consistent with the GCX bylaws against reorganized
GCX with respect to advancement of legal fees and expenses up to an aggregate
maximum of $250,000 for all individuals, claims and occurrences (subject to
replenishment by any reimbursement received by reorganized GCX from any source).
In addition, AMCE will fund the procurement of "tail" coverage under the D&O
Policy, up to a maximum premium cost of $350,000, which amount will not be an
Deduction Claim within the meaning of the Term Sheet.

                     [Remainder of page intentionally blank]


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      We look forward to working with you on the Proposed Transaction.

                                        Very truly yours,

                                        AMC ENTERTAINMENT INC.


                                        By:  /s/ Craig R. Ramsey
                                             Craig R. Ramsey
                                             Senior Vice President - Finance,
                                             Chief Financial Officer and
                                             Chief Accounting Officer


ACKNOWLEDGED AND AGREED TO:

GC COMPANIES, INC.


By:  /s/ G. Gail Edwards
     G. Gail Edwards
     President and Chief Operating Officer




                       SIGNATURE PAGE TO LETTER OF INTENT
<PAGE>
                                                  CONSENT OF PRINCIPAL CLAIMANTS


The undersigned Principal Claimants in the Chapter 11 Cases hereby consent to
this Letter of Intent and acknowledge that it constitutes a "Qualified Letter of
Intent" within the meaning of the Support Agreements.


THE COMMITTEE OF UNSECURED CREDITORS
IN THE CHAPTER 11 CASES OF THE GCX DEBTORS


By:  /s/ William S. Kaye
     -----------------------------------
     Name:  William S. Kaye
     Title: Chairman



GENERAL ELECTRIC CAPITAL CORPORATION


By:  /s/ Nicole Russo
     -----------------------------------
     Name:  Nicole Russo
     Title: Risk Manager



HARCOURT GENERAL, INC.


By:  /s/ Charles P. Fontaine
     -----------------------------------
     Name:  Charles P. Fontaine
     Title: Vice President




                       SIGNATURE PAGE TO LETTER OF INTENT

<PAGE>


                                                                       EXHIBIT I
                                                                      TERM SHEET

                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GC COMPANIES, INC. ("GCC") BY AMC
ENTERTAINMENT INC. ("AMCE")(1)


      A. CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS

           (a) Unclassified Claims (not entitled to vote)

           Administrative      On the Effective Date, or as soon thereafter as
           Claims:             practicable, each holder of an Allowed
                               Administrative Claim will receive payment in full
                               in cash of the unpaid portion of such Allowed
                               Administrative Claim.

           DIP Financing       On the Effective Date, or as soon thereafter as
           Claims:             practicable, the holders thereof will receive
                               payment in full in cash of the Allowed DIP
                               Financing Claims.

           Priority Tax        At the option of AMCE, each holder of an Allowed
           Claims:             Priority Tax Claim(2) will receive either (i)
                               payment in full in cash on the Effective Date or
                               as soon thereafter as practicable, or (ii)
                               payment over a six year period from the date of
                               assessment as provided in section 1129(a)(9)(C)
                               of the Bankruptcy Code with interest payable at
                               7% annually or at such other rate agreed to by
                               AMCE and the holder of such claim or determined
                               by the Bankruptcy Court; provided, however, that
                               any Allowed Priority Tax Claim for which any
                               member of the GECC Group is liable, the payment
                               of which is demanded from such member by the
                               applicable taxing authority, shall be payable
                               upon the later of the date of such demand or the
                               Effective Date.


----------

(1) This Term Sheet contemplates that AMCE will acquire the stock of Reorganized
GCC pursuant to a plan of reorganization for the GCC Debtors (the "Plan") and
operate it as a wholly-owned subsidiary. AMCE may designate that such stock will
be acquired by AMCE's subsidiary, American Multi-Cinema, Inc.

(2) Allowed Priority Tax Claims shall include sales taxes related to the GECC
Group's synthetic leases.
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TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


           (b) Unimpaired Claims (deemed to accept)


           Class 1--Other        On the Effective Date, or as soon thereafter as
           Priority Claims:      practicable, each holder of a Class 1 Claim
                                 will receive payment in full in cash of such
                                 Allowed Other Priority Claim.

           Class 2--Secured      As to each Class 2 Claim, at the option of
           Claims other than     AMCE, AMCE will either (i) reinstate such Class
           Banks, Heller and     2 Claim by curing all outstanding defaults with
           GECC Group:           all legal, equitable, and contractual rights
                                 remaining unaltered, except as permitted by 11
                                 U.S.C. Section 1124(2), (ii) pay in full the
                                 allowed amount of such Class 2 Claim in cash on
                                 the Effective Date or as soon thereafter as
                                 practicable or (iii) satisfy such Class 2 Claim
                                 by delivering to the claimant the collateral
                                 securing such claim.

           Class 3--Claims       As to each Class 3 Claim, AMCE will reinstate
           of Heller:            such Class 3 Claim by curing all outstanding
                                 defaults and leaving all legal, equitable, and
                                 contractual rights unaltered, except as
                                 permitted by 11 U.S.C. Section 1124(2);
                                 provided, that, AMCE shall have the right to
                                 pay such Allowed Class 3 Claim in full in cash
                                 on the Effective Date, or as soon thereafter as
                                 practicable, in full satisfaction of such
                                 Allowed Class 3 Claim. For purposes of the
                                 foregoing, Heller shall be deemed to have an
                                 allowed Class 3 Claim in the amount of
                                 $28,408,027 as of December 4, 2001, which
                                 amount shall be reduced by the principal
                                 portion of any payments made by GCC through the
                                 Effective Date.


                                       2

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TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


           (c) Impaired Claims (entitled to vote)


Class 4--Claims of        For purposes of the Plan, Fleet National Bank, N.A.
Banks:                    ("Fleet") and The Bank of Nova Scotia (collectively,
                          the "Domestic Banks") shall be deemed to have Allowed
                          Class 4 Claims of $44.6 million. On the Effective
                          Date, or as soon thereafter as practicable, each
                          holder of an Allowed Class 4 Claim will receive New
                          AMCE Notes(3) with a face amount equal to 100% of its
                          Allowed Class 4 Claim(4); provided, however, that each
                          holder of a Class 4 Claim may elect to receive, in
                          lieu of its New AMCE Notes, cash in an amount equal to
                          87.5% of the New AMCE Notes to which it would
                          otherwise be entitled (such option being hereinafter
                          referred to as the "New AMCE Notes Exchange Option").
                          Whether or not the New AMCE Notes Exchange Option is
                          exercised, the consideration provided for herein shall
                          be in full satisfaction of the Allowed Class 4 Claims
                          for all purposes, and without limiting the foregoing,
                          will be deemed to fully satisfy all claims and rights
                          of the holders of such claims against Harcourt
                          General, Inc. ("Harcourt") under that certain
                          Intercreditor Agreement dated January 26, 1999 (the
                          "Intercreditor Agreement") between Harcourt and Bank
                          Boston, N.A. (n/k/a Fleet National Bank, N.A.), as
                          administrative agent for the Domestic Banks.

GCC's Guaranty of         As a condition of the treatment of the Class 4 Claims
Hoyts General             as described above (the "JV Loan Purchase Condition"),
Cinemas South             prior to the Effective Date, the lenders (the "SA
America's Credit          Lenders") to Hoyts General Cinemas South America (the
Facilities:               "JV") shall have sold, and GCC(5) shall have
                          purchased, one half of the SA Lenders' loans to the JV
                          (the "GCC JV Loan Portion") for no more than 87.5% of
                          the face amount of that portion of such JV loans (the
                          "JV Loan Purchase"), and the SA Lenders shall have
                          released GCC from any liability by reason of GCC's
                          several guaranties (collectively, the "GCC Guaranty")
                          of the JV's credit facilities. Notwithstanding the
                          foregoing, GCC may, at its option,


----------

(3) New AMCE Notes shall be newly issued notes added to AMCE's existing 9.5%
Senior Subordinated Notes due 2/1/11 or any other issue of AMCE Senior
Subordinated Notes with materially similar terms. See Term Sheet - New AMCE
Notes.

(4) AMCE shall have the right to pay cash to holders of Class 4 Claims in lieu
of part of the New AMCE Notes, at 100% of the principal amount thereof, to the
extent that AMCE's current bond indenture restricts AMCE's ability to issue New
AMCE Notes in excess of a certain aggregate amount.

(5) In any event, GCC shall be deemed to have secured its own release from the
GCC Guaranty. However, AMCE may designate an AMCE affiliate to be the purchaser
of the GCC JV Loan Portion, so long as the aggregate amount paid to the SA
Lenders in cash for the release of the GCC Guaranty and the purchase of the GCC
JV Loan Portion equals the agreed total for the JV Loan Purchase.

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TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                          purchase the GCC JV Loan Portion of less than all of
                          the SA Lenders; in such event, any claim against GCC
                          under the GCC Guaranty shall be released with respect
                          to such GCC JV Loan Portion, and in no event shall the
                          JV Loan Purchase Condition be satisfied for purposes
                          of this Term Sheet unless the entire JV Loan Purchase
                          with respect to the GCC JV Loan Portion has occurred.
                          Any JV Loan Purchase shall be financed by borrowings
                          under the DIP facility or a successor DIP facility.

Bank Support Agreement    As Fleet and Bank of America, N.A. ("BofA"), each on
Condition                 behalf of itself and its affiliates, foreign and
                          domestic, in their respective capacities as
                          administrative agent(s) and lender(s) to GCC and its
                          affiliates and joint ventures, foreign and domestic)
                          (collectively, the "Banks") have not entered into a
                          support agreement agreeing to the treatment of Class 4
                          Claims and the satisfaction of the JV Loan Purchase
                          Condition described above as of the date hereof (the
                          "Bank Support Agreement Condition"), the treatment of
                          Class 4 Claims under this Term Sheet (and, in the
                          event that AMCE selects Option B below, Class 8 Claims
                          {as defined in Option B} that would otherwise be
                          classified in Class 6) shall be modified, at AMCE's
                          option, to consist of the treatment described under
                          Option A, Option B or Option C below, and the terms of
                          the selected option shall become part of this Term
                          Sheet, unless otherwise agreed by AMCE and the Banks,
                          so long as such alternative agreed upon treatment of
                          Class 4 Claims and claims arising under or relating to
                          the GCC Guaranty under this Term Sheet does not have a
                          material adverse effect on the treatment of any other
                          class of claims under this Term Sheet:

                          Option A:

                          -   The JV Loan Purchase Condition shall be waived. In
                              lieu thereof, GCC shall reject the GCC Guaranty
                              (to the extent, if any, that it is an executory
                              contract), and the SA Lenders may assert a general
                              unsecured Class 6 claim against GCC therefor (the
                              "GCC Guaranty Claim"). To the extent that the GCC
                              Guaranty Claim is allowed by the bankruptcy court,
                              it shall be the "Allowed GCC Guaranty Claim." AMCE
                              will make available for distribution on account of
                              the Allowed GCC Guaranty Claim New AMCE Stock with
                              a Plan Value equal to that fraction of the Allowed
                              GCC Guaranty Claim, the numerator of which is the
                              total Plan Value of the New AMCE Stock (plus, if
                              applicable under clause (b) of the Conditional
                              Class 6 Recovery, the Plan Value of the Top-Up
                              AMCE Stock and any cash


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                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                              substituted by Harcourt therefor) that would have
                              been distributed to the holders of Allowed Class 6
                              Claims had the Bank Support Agreement Condition
                              not been waived and this provision had not become
                              effective, and the denominator of which is the
                              total amount of the Allowed Class 6 Claims other
                              than the Allowed GCC Guaranty Claim. The Plan
                              Value of such New AMCE Stock with respect to each
                              Allowed GCC Guaranty Claim shall be applied to
                              reduce the amount of debt outstanding under the JV
                              credit facility to which each Allowed GCC Guaranty
                              Claim relates.

                          -   If the fair market value of the New AMCE Notes
                              (based on the average of the bid and ask prices on
                              the trading date immediately prior the date of
                              distribution) to be distributed to holders of
                              Allowed Class 4 Claims is less than the Allowed
                              Class 4 Claims, then such holders shall be
                              entitled to receive additional New AMCE Notes with
                              a fair market value equal to the deficiency.

                          Option B:

                          -   All nonpriority, unsecured claims against GCC that
                              (i) are not also claims against any direct or
                              indirect subsidiary of GCC that is a chapter 11
                              debtor and (ii) would otherwise have been
                              classified in Class 6, including without
                              limitation any claim arising under or relating to
                              the GCC Guaranty, shall be separately classified
                              in a new Class 8. The holders of allowed unsecured
                              claims in Class 8, including without limitation
                              claims arising under or relating to the GCC
                              Guaranty, shall receive New AMCE Stock with a Plan
                              Value (as defined in footnote 9 below) or, at
                              AMCE's option, cash, equal to 5% of each holder's
                              Allowed Class 8 Claim.

                          -   If the fair market value of the New AMCE Notes
                              (based on the average of the bid and ask prices on
                              the trading date immediately prior to the date of
                              distribution) to be distributed to holders of
                              Allowed Class 4 Claims is less than the Allowed
                              Class 4 Claims, then such holders shall be
                              entitled to receive additional New AMCE Notes with
                              a fair market value equal to the deficiency.

                          Option C:

                          -   The Class 4 Claims and any claims arising under or
                              relating to the GCC Guaranty shall be treated in
                              such manner as AMCE designates, so long as such
                              treatment


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TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                              does not require any reduction in the amount of
                              the consideration that would have been received by
                              the holders of allowed claims in any other class
                              absent such treatment of Class 4 claims or claims
                              arising under or relating to the GCC Guaranty.

Class 5--Claims of        For purposes of the Plan, the GECC Group shall be
the GECC Group:           deemed to have Allowed Class 5 Claims in the aggregate
                          amount of $78.3 million(6).

                          On the Effective Date, or as soon thereafter as
                          practicable, each holder of an Allowed Class 5 Claim
                          secured by identifiable equipment or leaseholds (i.e.,
                          all members excluding Fifth Third and Bank Leumi),
                          whose Allowed Class 5 Claims are estimated to be $71.1
                          million in the aggregate, will receive the following
                          consideration (i) New AMCE Notes with a face amount
                          equal to 90% of its Allowed Class 5 Claim (i.e., $64
                          million in the aggregate)(7); provided, however, that
                          each Allowed Class 5 Claim holder shall have the right
                          to exercise the New AMCE Notes Exchange Option for the
                          New AMCE Notes to which it would otherwise be entitled
                          (i.e., for $56 million in cash in the aggregate); and
                          (ii) New AMCE Stock (as defined below) with an
                          aggregate Plan Value (as defined below) equal to 4.5%
                          of its Allowed Class 5 Claim (i.e., $3.2 million Plan
                          Value).

                          On the Effective Date, or as soon thereafter as
                          practicable, each holder of an Allowed Class 5 Claim
                          secured by unidentifiable equipment (i.e., Fifth Third
                          and Bank Leumi), whose Allowed Class 5 Claims are
                          estimated to be $7.2 million in the aggregate, will
                          receive the following consideration (i) New AMCE Notes
                          with a face amount equal to 50% of its Allowed Class 5
                          Claim (i.e., $3.6 million in the aggregate); provided,
                          however, that each Allowed Class 5 Claim holder shall
                          have the right to exercise the New AMCE Notes Exchange
                          Option for the New AMCE Notes to which it would
                          otherwise be entitled (i.e., for $3.15 million in cash
                          in the aggregate); and (ii) New AMCE Stock (as defined
                          below) with an aggregate Plan Value (as defined below)
                          equal to 22.5% of its Allowed Class 5 Claim (i.e.,
                          $1.62 million Plan Value).


----------

(6) $78.3 million shall be reduced by half of any adequate protection payments
received by the GECC Group in excess of $9 million in the aggregate (the "GECC
Excess Payments").

(7) AMCE shall have the right to pay cash to holders of Class 5 Claims in lieu
of part of the New AMCE Notes, at 100% of the principal amount thereof, to the
extent that AMCE's current bond indenture restricts AMCE's ability to issue New
AMCE Notes in excess of a certain aggregate amount.


                                       6
<PAGE>
                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


Class 6--Unsecured        On the Effective Date, or as soon thereafter as
Claims Other Than         practicable, each holder of an Allowed Class 6 Claim
Any Unsecured             will receive New AMCE Stock(8) with an aggregate Plan
Claims of the Banks,      Value(9) equal to such holder's pro rata share of the
Heller, the GECC          sum of (a) Base Class 6 Recovery plus (b) the
Group, or Harcourt:       Conditional Class 6 Recovery (if any), each as defined
                          below; provided, that in no event shall holders of
                          Allowed Class 6 Claims receive New AMCE Stock with a
                          Plan Value in excess of 100% of their Allowed Claims.

                          The "Base Class 6 Recovery" shall be equal to: (w)
                          $37.5 million (plus, if and only if (A) AMCE exercises
                          its rights to require GCC to reject any real estate
                          lease under 11 U.S.C. Section 365 which GCC has not
                          already rejected(10), other than the Bay Plaza
                          Expansion {which does not include the existing Bay
                          Plaza location}, Erie Commons, Summit Park and Midway
                          Mall leases, (any such newly rejected lease other than
                          the Bay Plaza Expansion, Erie Commons, Summit Park and
                          Midway Mall leases being a "Newly Rejected Lease") and
                          (B) AMCE has been afforded the reasonable opportunity
                          to renegotiate the terms of such Newly Rejected Lease
                          prior to such rejection, 32/45's (or 71.1%) of the
                          allowed unsecured claim of the lessor arising as a
                          result of such rejection of the Newly Rejected
                          Leases); plus
                          (x) to the extent that any Class 6
                          Claims are allowed on account of the rejection of the
                          theatre leases known as Rancho (Unit 422), Galleria
                          (Unit 744), Lincoln Mall (Unit 870) or Deerfield 8
                          (Unit 922) (such Allowed Class 6 Claims being


----------

(8) AMCE would be willing to discuss two alternative methods for distributing
such New AMCE Stock to holders of Allowed Class 6 Claims: (1) distributing
freely tradable New AMCE Stock directly to the holders of such claims or (2)
distributing New AMCE Stock to a liquidating trust (the "Unsecured Stock Trust")
under the control of the Committee for the benefit of the holders of Allowed
Class 6 Claims, provided that the Unsecured Stock Trust would enter into an
agreement with AMCE to fix the parameters for the orderly liquidation of such
New AMCE Stock.

(9) New AMCE Stock shall be newly issued shares of AMCE Common Stock, valued at
the average closing price per share for the 15 days prior to the Effective Date,
subject to a minimum price per share of $10. "Plan Value", when referencing New
AMCE Stock, means the product of multiplying the applicable number of shares of
New AMCE Stock by the per share value of the New AMCE Stock determined in
accordance with the preceding sentence. The number of shares of New AMCE Stock
needed to achieve a specified Plan Value is calculated by dividing that Plan
Value by the per share value of the New AMCE Stock as so determined.

(10) For purposes of this Term Sheet, each of the leases listed on Exhibit A
(the "Identified Leases") is considered to have been previously rejected by GCC,
other than the Erie Commons, Summit Park and Midway Mall leases. Exhibit A is
not an exhaustive list of the previously rejected leases.


                                       7
<PAGE>
                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                          hereinafter referred to in the aggregate as the
                          "Allowed Designated Lease Claims"), the positive
                          amount (if any) that results from multiplying (i) the
                          lesser of $1.4 million or the Allowed Designated Lease
                          Claims, minus (in either case) the amount, if any,
                          which results from subtracting the aggregate Allowed
                          Claims of John Berylson and Michael Greeley from $4
                          million and (ii) that fraction, the numerator of which
                          fraction is the total Plan Value of the New AMCE Stock
                          (plus, if applicable under clause (b) of the
                          Conditional Class 6 Recovery, the Plan Value of the
                          Top-Up AMCE Stock and any cash substituted by Harcourt
                          therefor) that would have been distributed to the
                          holders of Allowed Class 6 Claims had the Allowed
                          Designated Lease Claims been zero, and the denominator
                          of which is the total amount of the Allowed Class 6
                          Claims other than the Allowed Designated Lease Claims;
                          minus
                          (y) the amount (if any) by which the aggregate
                          amount of the "Deduction Claims" exceeds $20 million;
                          plus
                          (z) the amount (if any) by which the aggregate
                          amount of the "Deduction Claims" is less than $20
                          million.

                          As used herein, the term "Deduction Claims" shall be
                          defined as the aggregate sum of the Administrative
                          Claims (exclusive of operating expenses incurred or
                          accrued and paid in the ordinary course of business
                          for goods and services, sales taxes and federal and
                          state taxes relating to ordinary income), plus
                          retention, severance and bonus payments (including
                          bonuses paid in the normal course) (without
                          duplication), plus the Priority Tax Claims, plus the
                          Class 1 Claims, plus the Class 2 Claims, plus the Cure
                          Claims,(11) plus the adequate protection payments,
                          less the GECC Excess Payments and any adequate
                          protection payments made to Heller subsequent to
                          August 1, 2001 and applied to the reduction of the
                          pre-petition principal amount of Heller's Class 3
                          Claim, in all instances whether payments on behalf of
                          such Deduction Claims were made from August 1, 2001
                          through the Effective Date or whether such Deduction
                          Claims are outstanding on the Effective Date;
                          provided, however, that the component of Deduction
                          Claims that relates to severance and retention
                          payments, including amounts paid under the Amended and
                          Restated Termination


----------

(11) As used herein, the term "Cure Claims" means the cost of curing all
outstanding defaults under contracts to be assumed by Reorganized GCC (including
any amount reimbursed to Harcourt rather than paid to a lessor pursuant the
second paragraph of the Class 7 treatment below) and the cost of curing any
outstanding defaults under contracts previously assumed by GCC.


                                       8
<PAGE>
                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                          and Change of Control Agreements approved by the
                          Bankruptcy Court's Order dated March 16, 2001 but not
                          including any bonuses paid in the normal course, shall
                          be deemed to equal $5 million regardless of the actual
                          amounts that are paid through the Effective Date or
                          outstanding on the Effective Date; bonuses paid in the
                          normal course shall constitute a Deduction Claim based
                          on the actual amount of such bonuses paid. All fees
                          and expenses incurred by the post-confirmation
                          Committee, the Unsecured Stock Trust, the Class 6
                          distribution agent and any and all sub-agents,
                          professionals and others employed by any or all of
                          them (including, without limitation, the
                          debtors-in-possession's present or former employees
                          and counsel), shall be satisfied exclusively from
                          assets or cash otherwise distributable to the holders
                          of Allowed Class 6 Claims pursuant to this Term Sheet.
                          Additionally: (i) any fees due and payable to the
                          Office of the United States Trustee pursuant to
                          section 1930(a)(6) of title 28 of the United States
                          Code with respect to any chapter 11 cases that remain
                          open from and after the Effective Date of the Plan
                          shall be paid and satisfied exclusively from the
                          assets or cash otherwise distributable to the holders
                          of Allowed Class 6 Claims; provided that, except as
                          set forth below with respect to General Cinema
                          Theatres, Inc. ("GCT") and, under certain
                          circumstances, GCC, all of the GCC debtors' cases will
                          be closed as of the Effective Date, or as soon
                          thereafter as reasonably practicable; provided
                          further, that GCT will move to close its case promptly
                          when requested to do so by the post-confirmation
                          Committee after resolution of all disputed Class 6
                          Claims and (but only if Option B under the "Bank
                          Support Agreement Condition" is chosen) the GCC case
                          will be closed promptly after resolution of all
                          disputed Class 8 Claims. Any fees and expenses
                          (including, without limitation, professional fees and
                          expenses) incurred by the post-confirmation Committee
                          in objecting to or otherwise resolving Administrative
                          Claims and Priority Tax Claims shall be satisfied
                          exclusively from the assets or cash otherwise
                          distributable to the holders of Allowed Class 6 Claim,
                          it being understood that the reorganized debtors shall
                          have no obligation to object to or otherwise resolve
                          Administrative Claims and Priority Tax Claims, that
                          any such objection or resolution shall be at the
                          option, risk and expense of the post-confirmation
                          Committee and that the reorganized debtors will be
                          reimbursed for any out-of-pocket expenses incurred as
                          a result of any such objection or resolution.


                                       9
<PAGE>
                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                          The "Conditional Class 6 Recovery" shall be equal to
                          the sum of the following, which shall be conditioned
                          upon occurrence of the conditions described in clauses
                          (a) and (b) and may therefore be zero: (a) If the JV
                          Loan Purchase Condition is waived and AMCE selects
                          Option A described above under the heading "Bank
                          Support Agreement Condition," the Plan Value of New
                          AMCE Stock to be made available by AMCE to the holders
                          of the Allowed GCC Guaranty Claim, plus (b) to the
                          extent any pre-petition claims are allowed on account
                          of the rejection of any of the Identified Leases (any
                          such allowed claims being "Allowed Identified Lease
                          Claims"), Harcourt shall, at its own expense, purchase
                          AMCE Stock in the open market (or New AMCE Stock if
                          agreed by AMCE) for distribution to the holders of
                          Allowed Class 6 Claims such that, when added to the
                          New AMCE Stock made available by AMCE under the Base
                          Class 6 Recovery and any New AMCE Stock to be
                          distributed under clause (a) above, the AMCE Stock
                          made available by Harcourt is sufficient to enable
                          holders of Allowed Class 6 Claims other than the
                          holders of Allowed Identified Lease Claims to receive
                          the same amount of AMCE Stock per dollar amount of
                          their Allowed Class 6 Claims as they would have
                          received if the Allowed Identified Lease Claims had
                          not been allowed (the "Top-Up AMCE Stock"); provided,
                          that Harcourt may satisfy this obligation by
                          delivering, in its discretion, either a number of
                          shares of AMCE Stock equal to the Top-Up AMCE Stock or
                          cash in an amount equal to the market value of the
                          Top-Up AMCE Stock as of the Effective Date. Except as
                          provided in the preceding clause (b), Harcourt shall
                          have no responsibility with respect to any
                          distributions to third party holders of any Allowed
                          Class 6 Claim. The Conditional Class 6 Recovery is
                          intended to provide for the same treatment to the
                          holders of Allowed Class 6 Claims that are determined
                          to be such under the conditions described in clauses
                          (a) and (b) of this paragraph (in terms of the number
                          of shares of AMCE Stock per dollar of Allowed Class 6
                          Claims) as other holders of Allowed Class 6 Claims
                          would receive if the claims described in clauses (a)
                          and (b) had not become Allowed Class 6 Claims), and
                          the Conditional Class 6 Recovery shall be interpreted
                          accordingly.

                          Notwithstanding anything to the contrary contained
                          herein, the treatment of Allowed Class 6 Claims under
                          this Term Sheet is predicated upon the assumption that
                          all of the Identified Leases (other than the Erie
                          Commons, Summit Park and Midway Mall leases, which
                          shall be rejected) and all other


                                       10
<PAGE>
                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                          leases that were assigned by any of the GCC Debtors to
                          any party other than one of the GCC Debtors (the
                          "Assigned Leases") have been rejected or have deemed
                          rejected under section 365(d) of the Bankruptcy Code.
                          Accordingly, notwithstanding anything to the contrary
                          contained herein, the GCC Debtors shall reject all
                          Identified Leases that have not been previously
                          rejected, and all Assigned Leases that have not been
                          previously rejected, without any additional obligation
                          on the part of AMCE.

                          Notwithstanding anything to the contrary contained
                          herein, in the event that AMCE elects to treat claims
                          arising under or relating to the GCC Guaranty and
                          other nonpriority unsecured claims that are solely
                          claims against GCC (but not against any subsidiary
                          chapter 11 debtor) that would otherwise be classified
                          in Class 6 in accordance with Option B under the "Bank
                          Support Agreement Condition" above, then such claims
                          shall not be included in Class 6 and shall not be
                          entitled to treatment in accordance with the
                          provisions regarding Class 6 claims. Instead, all such
                          claims shall be treated as Class 8 claims in
                          accordance with Option B.

                          Notwithstanding the foregoing, upon the agreement of
                          AMCE and the Committee, Class 6 may be divided into
                          two or more sub-classes which may each receive
                          different treatment under the Plan, provided that the
                          aggregate consideration distributable to such
                          sub-classes does not exceed the total consideration
                          otherwise distributable to Class 6 pursuant to this
                          term sheet.

Class 7- Convenience      As soon as practicable following the AMCE Class 6
Class:                    Distribution Date under the Plan, each Holder of an
                          Allowed Class 6 Claim that is $500 or less or that the
                          Holder thereof elects to reduce to $500 shall receive
                          cash paid from the Class 6 recovery (or the proceeds
                          thereof), in an amount equal to seventy percent (70%)
                          of such Holder's Allowed convenience claim.
                          Notwithstanding the foregoing, if the Class 7
                          convenience claim exceed $425,000.00 the Committee may
                          elect, on or before the Confirmation Date, to
                          eliminate Class 7 of the Plan, in which event each and
                          every Allowed convenience claim shall be treated in
                          all respects as an Allowed Class 6 Claim and any
                          election of the Holder thereof to reduce its Allowed
                          Claim to $500 shall be deemed null and void.


                                       11
<PAGE>
                                                                January 28, 2002

TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


Class 8 --                As provided under Option B of the heading "Bank
Nonpriority,              Support Agreement Condition" above.
unsecured claims
against GCC that are
not also claims
against any direct or
indirect subsidiary of
GCC that is a chapter
11 debtor and that
would otherwise have
been classified in
Class 6

Class 9 -- Claims of      On the Effective Date, or as soon thereafter as
Harcourt:                 practicable, in full satisfaction of Harcourt's Class
                          7 Claims (i) Harcourt will receive cash in an amount
                          equal to $1 million; and (ii) AMCE shall, as to each
                          of the Harcourt Leases (as defined below) either (a)
                          agree to become a substitute guarantor of such
                          Harcourt Lease in exchange for the lessor under such
                          Harcourt Lease releasing Harcourt from all claims
                          thereunder or (b) absent such a release of Harcourt by
                          the applicable lessor, provide an indemnification to
                          Harcourt against any further liability related to such
                          Harcourt Lease (which indemnification shall include
                          any and all costs and liabilities of Harcourt arising
                          after the Effective Date in connection with a default
                          under such Harcourt Lease, including but not limited
                          to reasonable fees of counsel, but shall not include
                          any guarantee fee or other payment that is not based
                          upon actual costs incurred by Harcourt in satisfying
                          or defending its obligations under the applicable
                          Harcourt Lease). For purposes hereof, "Harcourt Lease"
                          includes all leases (a) under which Harcourt was the
                          original tenant, is a guarantor or is otherwise liable
                          for rent upon GCC's default in payment thereof, (b)
                          that have not been rejected by GCC as of the date of
                          this Term Sheet (other than the Erie Commons, Summit
                          Park and Midway Mall leases, which GCC shall reject
                          and all three such leases shall not be deemed to be
                          Harcourt Leases), and (c) that have not previously
                          been assigned by any of the Debtors to any party other
                          than an affiliate of the Debtors. Without limiting the
                          foregoing, none of the Identified Leases shall be
                          deemed to be a Harcourt Lease. The Harcourt Leases,
                          which include without limitation the Reserved Leases
                          (as defined below), shall be assumed as part of the
                          plan of reorganization, without any payment or subsidy
                          from Harcourt, and shall be specifically identified in
                          an exhibit to the plan of reorganization. No


                                       12
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           Harcourt Lease shall be rejected without Harcourt's
                           consent, unless otherwise agreed by AMCE and Harcourt
                           in connection with the Harcourt Lease renegotiations
                           described below.

                           AMCE acknowledges that Harcourt has paid certain cure
                           costs to the lessors under the Plaza at Chapel (Unit
                           496) and Centennial (Unit 942) leases, and Harcourt
                           will be reimbursed under the plan of reorganization
                           for such cure costs to the extent such cure costs
                           would otherwise be required to be paid to such
                           lessors in connection with the assumption of such
                           leases, in lieu of any claim with respect to such
                           cure costs by such lessors.

                           Harcourt shall also be released from all claims of
                           the Domestic Banks under the Intercreditor Agreement,
                           and the Reimbursement and Security Agreement
                           described therein shall terminate and be of no
                           further force or effect.

                           AMCE shall use reasonable commercial efforts (which
                           shall not be interpreted to require AMCE to pay any
                           amount other than its own attorneys' fees) to
                           renegotiate the Harcourt Leases prior to the
                           Effective Date. Except as provided in the following
                           sentence, Harcourt shall be entitled to participate
                           in such renegotiations until the Effective Date, but
                           direction and control of such renegotiations shall be
                           at AMCE's sole and absolute discretion. Harcourt
                           shall not be entitled to participate in renegotiation
                           of the Springfield, Hollywood Galaxy or Centennial
                           Lakes leases (the "Reserved Leases"); provided, that
                           AMCE shall keep Harcourt reasonably informed with
                           respect to the status of such negotiations and
                           provided, further, that AMCE shall not seek or obtain
                           lease concessions on other leases AMCE may have with
                           the lessors under the Reserved Leases in lieu of
                           lease concessions under the Reserved Leases without
                           Harcourt's consent. If the renegotiation of any
                           Reserved Lease results in an agreement with the
                           lessor for a replacement lease or lease buyout within
                           the time frames set forth below, Harcourt will be
                           entitled to the following: (i) with respect to each
                           Reserved Lease for which an agreement for a
                           replacement lease or lease buyout is executed prior
                           to the Effective Date, Harcourt will be entitled to
                           receive New AMCE Stock with a Plan Value of $250,000
                           on the Effective Date; and (ii) with respect to each
                           Reserved Lease for which AMCE received a written
                           proposal from the lessor for a replacement lease or
                           lease buyout prior to the Effective Date and for
                           which AMCE and such lessor execute


                                       13
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           an agreement for a replacement lease or lease buyout
                           within six (6) months after the Effective Date on
                           terms that are at least as favorable to the lessee
                           (after taking into account any payment to Harcourt
                           pursuant to this Term Sheet) as those contained in
                           such proposal, Harcourt will be entitled to receive
                           New AMCE Stock with a Plan Value of $250,000 within
                           ten (10) business days following execution of such
                           post-Effective Date agreement.

                           Harcourt agrees that it will work cooperatively with
                           AMCE with respect to the renegotiation of the
                           Harcourt Leases. Regardless of whether Harcourt
                           participates in a renegotiation, Harcourt shall
                           receive the net present value, using a 10% discount
                           rate, of 50% of any rent reductions (net of
                           inducement payments, if any, paid by AMCE) that are
                           renegotiated prior to the Effective Date for any of
                           the Harcourt Leases (excluding any rent reductions
                           that may be part of a replacement lease with respect
                           to a Reserved Lease or a lease buyout of a Reserved
                           Leases, but otherwise including any rent reduction on
                           a Reserved Lease). For purposes of the foregoing, a
                           rent reduction will be deemed to have been
                           renegotiated prior to the Effective Date if either
                           (a) the rent reduction is documented by an executed
                           and fully effective lease amendment (a "Harcourt
                           Lease Amendment") prior to or on the Effective Date,
                           or (b) notwithstanding that a Harcourt Lease
                           Amendment was not obtained by the Effective Date, (1)
                           the rent reduction was evidenced by a written
                           proposal from the lessor under the applicable
                           Harcourt Lease prior to the Effective Date and (2) a
                           Harcourt Lease Amendment is executed within six (6)
                           months following the Effective Date that includes
                           terms that are at least as favorable to the lessee
                           (after taking into account any payment to Harcourt
                           pursuant to this Term Sheet) as those contained in
                           such proposal. Amounts to which Harcourt is entitled
                           under this paragraph, if any, shall be payable in
                           cash on the later of (i) the Effective Date, or as
                           soon thereafter as practicable, or (ii) the date of
                           execution of the applicable Harcourt Lease Amendment.

                           Furthermore, except for Springfield Mall, Virginia
                           (Unit 867); Southlake, Indiana (Unit 875); Ford City,
                           Illinois (Unit 940); and Bay Plaza, New York (Unit
                           902), AMCE shall not extend the term of any of the
                           leases of which Harcourt is a guarantor beyond its
                           current term, unless Harcourt is provided evidence
                           reasonably satisfactory to it that it is not liable,
                           or is removed, as guarantor of the applicable lease
                           for any such extension


                                       14
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           period.

                           GCC shall also assign to Harcourt, without
                           representation or recourse, all of GCC's right, title
                           and interest in, to and under any collateral or
                           security, including without limitation any letters of
                           credit, guaranties and other security or documents
                           supporting the non-GCC assignee's or subtenant's
                           liability under any Assigned Leases under which
                           Harcourt may have contingent liability, whether as a
                           guarantor, original tenant or otherwise.

                           Harcourt's (and its affiliates') recovery and
                           distribution under the Plan shall be exclusively as
                           set forth in this treatment of Class 7 Allowed
                           Claims, and Harcourt (and its affiliates) shall not
                           be entitled to assert any claim in Class 6, whether
                           in its own name, in the name of a third party
                           landlord, as subrogee, as assignee or otherwise. As
                           of the Effective Date of the Plan, Harcourt (and its
                           affiliates) shall be deemed to have withdrawn any and
                           all proofs of claim asserted against the GCC Debtors
                           in any and all such capacities, with prejudice.

Class 10--Common           Subject to satisfaction of the Class 10 Participation
Stock Interests            Conditions (as defined below), a limited liability
(including any             company ("New Investments LLC") will acquire 100% of
Allowed Claims             the membership interests in GCCI LLC and, subject to
subordinated to the        certain conditions, the equity interests in New
level of common            Investments LLC will be distributed to (i) Holders of
stock under section        Allowed Interests, (ii) AMCE or its designee and
510(b) of the              (iii) investors who participate in a $16,250,000
Bankruptcy Code):          equity financing to be conducted by New Investments
                           LLC, as described in more detail below. Immediately
                           prior to such acquisition by New Investments LLC, any
                           investment portfolio assets, any net proceeds
                           received after the filing of the Plan with respect to
                           or from the disposition of such assets not initiated
                           by GCCI LLC and any furniture, fixtures and equipment
                           that are owned by GCCI Inc. will be transferred to
                           GCCI LLC, subject to any restrictions on transfers
                           binding on GCCI Inc. with respect to such
                           investments.

                           If and only if the Class 10 Participation Conditions
                           are satisfied, and not otherwise, Holders of Allowed
                           Interests shall receive the following consideration
                           on the Effective Date, or as soon thereafter as
                           practicable:

                           Each such Holder shall receive its Pro Rata Share of
                           (i) $100,000.00 Cash plus (ii) 10.416667% of the
                           limited liability


                                       15
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           interests (the "LLC Interests") of New Investments
                           LLC (the "Class 10 Percentage"), which percentage
                           shall be increased to 14% if the Preferred LLC
                           Interest Repurchase, as described below, occurs. "Pro
                           Rata Share" means the percentage calculated by
                           dividing such Holder's Allowed Common Stock Interest
                           by the aggregate amount of all Allowed Interests. The
                           distribution to each such Holder of its LLC Interests
                           shall be subject to and contingent upon the following
                           conditions (the "Distribution Conditions"): (i) the
                           filing of the notification of election on Form N-54A
                           by New Investments LLC to be subject to the
                           provisions of Sections 54 through 65 (applicable to
                           business development companies) of the Investment
                           Company Act of 1940 (the "BDC Election"), (ii)
                           effectiveness of the registration of New Investments
                           LLC on Form 10 under Section 12(g) of the Securities
                           Exchange Act of 1934 (the "34 Act Registration"), and
                           (iii) the effectiveness of registration of New
                           Investment LLC's investment manager (the "Investment
                           Manager") as an investment adviser under the
                           Investment Advisers Act of 1940 (the "Adviser Act
                           Registration"), without, in the case of any of the
                           BDC Election, the 34 Act Registration or the Adviser
                           Act Registration, the SEC requiring any changes to
                           the terms and provisions applicable to New
                           Investments LLC and the Investment Manager as
                           described herein or in the Form 10 or indicating that
                           any such term or provision might violate a provision
                           of law or regulation or subject New Investments LLC,
                           the Investment Manager or their respective member,
                           managers, employees or agents to any liability. If
                           the Distribution Conditions do not occur, New
                           Investments LLC shall have the option at the sole
                           discretion of the Investment Manager to direct that
                           no LLC Interests shall be distributed to the Holders
                           of Allowed Interests. If New Investments LLC
                           exercises such option, (i) the LLC Interests which
                           would otherwise be distributed to the Holders shall
                           be held by AMCE, or at AMCE's election, Reorganized
                           GCX or another of AMCE's designees, (ii) New
                           Investments LLC shall withdraw or not make, as the
                           case may be, its BDC Election and 34 Act Registration
                           and the Investment Manager shall withdraw or not make
                           the Adviser Act Registration, (iii) New Investments
                           LLC will operate as an investment company exempt from
                           registration under the Investment Company Act of 1940
                           (the "40 Act"), and (iv) the Holders of Allowed
                           Interests will not receive the Cash distribution
                           described above. In such event, none of New
                           Investments LLC, the Investment Manager, the
                           Reorganized Debtors or AMCE, nor their respective
                           members, managers,


                                       16
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           employees or agents shall have any liability to the
                           Holders of Allowed Interests if such Holders do not
                           receive any distribution of LLC Interests.

                           It is anticipated that New Investments LLC will file
                           the Form 10 prior to the Effective Date, and unless
                           the SEC agrees to accelerated consideration of the
                           Form 10, the SEC's decision to declare the Form 10
                           effective under the Securities Exchange Act of 1934
                           (the "34 Act") shall require at least 60 days from
                           filing. Because the BDC Election will become
                           effective upon filing, it is anticipated that New
                           Investments LLC will make the BDC Election only upon
                           the effectiveness of the 34 Act Registration.
                           Accordingly, any distribution of LLC Interests to
                           Holders of Allowed Interests may be delayed until
                           several months after confirmation until the
                           Distribution Conditions have been fulfilled or
                           waived.

                           The remaining equity interests in New Investments LLC
                           will be a special class of equity interests (the
                           "Preferred LLC Interests") which will be owned by
                           AMCE, or at AMCE's election, Reorganized GCX or
                           another of AMCE's designees. The Preferred LLC
                           Interests will represent 25.595238% of the equity of
                           New Investments LLC and will be entitled to receive a
                           distribution priority in an amount equal to $6.5
                           million (the "Preferred LLC Priority Amount"). The
                           Preferred LLC Interests will further be subject to an
                           option in favor of New Investments LLC to purchase
                           all, but not less than all, of such Preferred LLC
                           Interests for $6.5 million in Cash within 30 days
                           (the "Option Period") after the Effective Date. In
                           the event such option is not exercised, AMCE or its
                           designee shall have the right to put such Preferred
                           LLC Interests to New Investments LLC at any time
                           during the seven (7) day period after the expiration
                           of the Option Period for such $6.5 million amount.
                           (The exercise of either of such option or such put is
                           referred to as the "Preferred LLC Interest
                           Repurchase.") New Investments LLC shall not incur
                           debt or grant liens upon its assets without the
                           consent of the holders of the Preferred LLC Interests
                           while they remain outstanding. It is anticipated that
                           the Preferred LLC Interest Repurchase will occur
                           prior to the BDC Election.

                           Notwithstanding anything to the contrary contained
                           herein, in the event that any impaired Class of
                           Claims does not accept the Plan, and the Bankruptcy
                           Court determines that the proposed treatment of Class
                           10 as set forth herein violates the


                                       17
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           provisions of section 1129(b)(2) of the Bankruptcy
                           Code with respect to the treatment of such
                           nonaccepting Class, the treatment of Class 10 shall
                           be modified in any manner elected by AMCE to the
                           extent necessary to cause the Plan not to violate the
                           provisions of section 1129(b)(2) of the Bankruptcy
                           Code. In addition, if any party in interest objects
                           to the treatment of Class 10 as set forth herein and
                           the Bankruptcy Court sustains such objection, then
                           the Holders of Allowed Interests shall receive no
                           consideration under the Plan. As a matter of
                           disclosure but not as an obligation under or pursuant
                           to the Plan, in such event Reorganized GCCI Inc.
                           would retain all of its interest in GCCI LLC on the
                           Effective Date but AMCE would intend to cause the
                           sale of such interest to New Investments LLC after
                           the Effective Date for $6.5 million. All Existing GCX
                           Common Stock shall be deemed cancelled on the
                           Effective Date.

                                    If (a) prior to February 4, 2002, members of
                           the family of Richard A. Smith or their affiliates
                           (the "Smith Family") and New Investments LLC have not
                           executed an agreement obligating the Smith Family to
                           provide the Equity Financing and New Investments LLC
                           to consummate the transactions described herein with
                           respect to the Class 10 treatment, subject only to
                           the conditions described herein, or (b) prior to the
                           Confirmation Date, the $16,250,000 to be raised in
                           the Equity Financing has not been invested in or
                           committed to New Investments LLC (the "Class 10
                           Participation Conditions"), the Holders of Allowed
                           Interests shall receive no consideration under the
                           Plan.

                           The following sets forth additional information and
                           terms regarding New Investments LLC, and its
                           acquisition of the equity interests in GCCI LLC. Any
                           changes to the following information and terms will
                           be reflected in the Plan Documentary Supplement to be
                           filed prior to the Confirmation Date which will
                           include, among other documents, the LLC Operating
                           Agreement for New Investments LLC and the Investment
                           Management Agreement with New Investment LLC's
                           Investment Manager. To the extent of any
                           inconsistency between the Plan and the Plan
                           Documentary Supplement, the terms of the Plan
                           Documentary Supplement shall govern.

                           1. New Investments LLC.


                                       18
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           (a) New Investments LLC will be formed by members of
                           the family of Richard A. Smith or their affiliates
                           (the "Smith Family"), and will conduct an equity
                           financing of its LLC Interests, as described below.
                           The Smith Family includes, in addition to Richard A.
                           Smith, certain family members and related trusts,
                           charitable foundations and other entities that
                           collectively own approximately 28% of the outstanding
                           shares of GCX's Common Stock. Richard A. Smith
                           formerly served as Chairman and Chief Executive
                           Officer of GCX, and his son, Robert A. Smith,
                           formerly served as President and Chief Operating
                           Officer of GCX. John Berylson is the son-in-law of
                           Richard A. Smith.

                           (b) If the Distribution Conditions have been
                           fulfilled, New Investments LLC will be subject to all
                           the regulatory requirements and operational
                           restrictions applicable to a business development
                           company under the 40 Act. A business development
                           company is a type of closed-end investment company
                           and, as such, will not issue or have outstanding
                           redeemable securities. Business development companies
                           operate for the purpose of providing venture capital
                           financing and making available significant managerial
                           assistance to certain private or financially troubled
                           businesses. In recognition of the particular needs of
                           venture capital investment companies, the regulation
                           of business development companies under the 40 Act is
                           generally more flexible and less burdensome than that
                           applicable to traditional investment companies
                           regulated by the 40 Act. As a business development
                           company, New Investments LLC will also be required to
                           file annual, quarterly and similar reports pursuant
                           to Section 13 of the 34 Act.

                           (c) In order to avoid taxation of New Investments LLC
                           as a corporation, no interests in New Investments LLC
                           will be publicly tradable.

                           (d) New Investments LLC's business purpose will be to
                           manage and liquidate the investments of its portfolio
                           companies and to make additional investments in such
                           portfolio companies. New Investments LLC will not
                           make any investments in any companies other than such
                           portfolio companies or their respective affiliates or
                           successors.

                           2. Chestnut Hill Capital Partners LLC ("CHCP"). CHCP
                           owns 1% of the LLC interests of GCCI LLC. Prior to
                           the


                                       19
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           Effective Date, John Berylson and Demos Kouvaris, who
                           own 100% of the LLC interests of CHCP, will transfer
                           at GCX's direction all such CHCP LLC interests to
                           GCCI Inc., free and clear of all liens and
                           encumbrances (the "CHCP Transfer"), after which GCCI
                           Inc. will directly and indirectly own 100 % of the
                           LLC interests in GCCI LLC. The CHCP Transfer shall be
                           in full satisfaction of loans owed to GCX in the
                           principal amount of $419,309 by John Berlyson and in
                           the principal amount of $55,292 by Demos Kouvaris,
                           together with all interest (or other fees and
                           expenses, if any) accrued on (or with respect to)
                           such loans. New Investments LLC shall indemnify and
                           hold GCCI Inc. harmless against any loss or expense
                           incurred by GCCI Inc. with respect to CHCP
                           liabilities (other than liabilities to the Debtors),
                           if any.

                           3. Acquisition of GCCI LLC. Subject to the Class 10
                           Participation Conditions, New Investments LLC will
                           acquire from GCCI Inc. and CHCP 100% of the interests
                           (including carried interests) in GCCI LLC, free and
                           clear of all liens, encumbrances and security
                           interests of any kind (including any security
                           interests held by GCX), in consideration for the
                           issuance to GCCI Inc. of the Preferred LLC Interest
                           and the Class 10 Percentage of the LLC Interests (the
                           "Class 10 LLC Interests"). If the Distribution
                           Conditions occur, the Class 10 LLC Interests will be
                           distributed to the Holders of Allowed Interests. On
                           the Effective Date, the assets of GCCI LLC will
                           include (i) the portfolio investments of GCCI LLC and
                           GCCI Inc. as listed in Section I.6.b of the
                           Disclosure Statement, (ii) the proceeds, if any, of
                           any disposition of any of such investments received
                           after filing of the Plan with respect to or from a
                           disposition of such assets not initiated by GCCI LLC,
                           net of taxes on gains from such disposition and
                           transaction expenses, if any, and net of new capital
                           invested in the investment assets after filing of the
                           Plan, if any, and (iii) any furniture, fixture and
                           equipment assets of GCCI Inc. that are used
                           exclusively for conducting GCX's investment business.

                           4. Offering for $16,250,000 to Fund the Portfolio and
                           its Operations.

                           (a) As a condition to the acquisition by New
                           Investments LLC of the equity interests in GCCI LLC,
                           New Investments LLC shall have raised in an equity
                           financing (the "Equity Financing") $16,250,000 in
                           invested or committed capital. Investors in the
                           Equity Financing will receive LLC Interests in


                                       20
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           New Investments LLC, which LLC Interests will
                           represent, after the issuance of the Preferred LLC
                           Interests and the Class 10 LLC Interests, 63.988095%
                           of the equity of New Investments LLC. In the event
                           the Preferred LLC Interest Repurchase occurs, the LLC
                           Interests acquired by the investors in the Equity
                           Financing will represent 86% of the equity of New
                           Investments LLC.

                           (b) The Debtor understands that the Smith Family, and
                           certain affiliated trusts of the Smith Family
                           (collectively, the "Smith Investors"), together with
                           John Berylson, and certain family members and
                           affiliated trusts of John Berylson (collectively, the
                           "Berylson Investors"), intend to commit the full
                           $16,250,000 subject to the terms and conditions
                           described herein. Of this amount, it is anticipated
                           that the Berylson Investors will invest at least
                           $5,000,000. Notwithstanding the foregoing, holders of
                           Allowed Class 5 Claims who are "qualified
                           institutional buyers," as that term is defined in
                           Rule 144A promulgated pursuant to the Securities Act
                           of 1933, shall be entitled to participate in the
                           Equity Financing in an amount of up to $6,250,000.
                           Such holders of Allowed Class 5 Claims shall be
                           entitled to participate in such amount pro rata in
                           proportion to the amount of their Allowed Class 5
                           Claims and shall have over-subscription rights to the
                           extent other holders of Allowed Class 5 Claims do not
                           subscribe for their respective pro rata shares. Any
                           amounts which holders of Allowed Class 5 Claims elect
                           to purchase shall reduce the amount otherwise
                           available to the Smith Investors and the Berylson
                           Investors. New Investments LLC shall also reserve the
                           right to permit other investors to acquire LLC
                           Interests in the Equity Financing to the extent that
                           the Smith Investors and the Berylson Investors agree
                           not to purchase any LLC Interests not acquired by the
                           Holders of Allowed Class 5 Claims.

                           (c) The Berylson Investors and the Smith Investors
                           will require as a condition to proceeding with the
                           transactions described herein that (i) the
                           Confirmation Order will provide that, based on AMCE's
                           exercise of its right under Section 10.2 of the Plan
                           to elect to have the Claim of John Berylson in the
                           sum of $2,327,225.71 treated as a Class 6 Unsecured
                           Claim Allowed in full, such Claims will be so
                           treated, conditioned upon consummation of the
                           Preferred LLC Interest Repurchase, and (ii) the CHCP
                           Transfer and related loan satisfaction has occurred.
                           Except for such Claim of John Berylson, the Claim of
                           Demos Kouvaris in the sum of $117,109, any vested


                                       21
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           employee pension benefits under GCX's defined benefit
                           pension plan or 401(k) plan that either may have and
                           any salary and employee benefits (not to include in
                           any event any severance, SERP or supplemental
                           executive medical benefits) accrued and unpaid since
                           their hire by GCX or GCCI Inc. post-petition and
                           through the Effective Date, the obligations of the
                           Debtors to proceed with the transactions contemplated
                           herein shall be subject to the waiver and release by
                           each of Messrs. Berylson and Kouvaris and by CHCP of
                           any other Claims of any kind any of them may hold,
                           including without limitation any employment, deferred
                           compensation, severance or pool payment Claims.

                           5. Investment Manager and Management Fee

                           (a) A management company (the "Investment Manager")
                           will be formed which will serve as the investment
                           manager to New Investments LLC. The Investment
                           Manager will be owned and controlled by John Berylson
                           and Demos Kouvaris, who are currently the principals
                           of CHCP and manage the investment activities of GCCI
                           Inc. and GCCI LLC.

                           (b) The Investment Manager will enter into an
                           investment advisory and management agreement (the
                           "Investment Management Agreement") with New
                           Investments LLC and will receive an annual fee of 2%
                           per year of the net asset value of New Investments
                           LLC, subject to a minimum fee of $1,100,000 necessary
                           to cover the expenses, including salaries, of the
                           Investment Manager. This fee will be paid for a
                           period of four years. Thereafter, the minimum annual
                           fee will be $500,000 until all investments have been
                           liquidated. If in any year the $1,100,000 or $500,000
                           minimum, as the case may be, exceeds 2% of the net
                           asset value of New Investments LLC, such excess shall
                           be credited towards the 2% in any year in which the
                           2% exceeds the minimum for such year, but only to the
                           extent of such excess. Other expenses of New
                           Investments LLC, such as legal, auditing and
                           regulatory compliance fees, will be paid directly by
                           New Investments LLC.

                           (c) If the Distribution Conditions occur and the
                           Class 10 LLC Interests are distributed to the Holders
                           of Allowed Interests, the Investment Management
                           Agreement (i) will be for an initial term of two
                           years and be subject to annual renewals thereafter
                           with the approval of the Board of


                                       22
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           Managers and the "disinterested managers" of New
                           Investments LLC or the outstanding voting securities
                           holders of New Investments LLC in accordance with
                           Section 15 of the 40 Act, and (ii) will be subject to
                           termination upon 60 days notice, also as provided in
                           Section 15 of the 40 Act. If the Class 10 LLC
                           Interests are not distributed to the Holders of
                           Allowed Interests and New Investments LLC does not
                           make the BDC Election, the Investment Management
                           Agreement will be for an initial term of two years
                           and subject to annual renewals thereafter with the
                           approval of the Board of Managers.

                           (d) If New Investments LLC will be qualified as a
                           business development company, Investment Manager will
                           be required to register as an investment adviser
                           under the Investment Advisers Act of 1940.

                           6. Distributions. All distributions made by New
                           Investments LLC, including distributions upon
                           liquidation of New Investments LLC, will be made in
                           the following order of priority assuming the
                           Preferred LLC Interest Repurchase has occurred:

                           First, 100% to the holders of LLC Interests pro rata
                           until they have received aggregate distributions
                           equal to their Initial Capital Amounts. The "Initial
                           Capital Amounts" for the investors in the Equity
                           Financing will equal in the aggregate $16,250,000 and
                           for the Holders of Allowed Interests, assuming the
                           distribution to such holders occurs, will equal in
                           the aggregate $2,645,348.80.

                           Second, 100% to the holders of LLC Interests pro rata
                           until they have received aggregate distributions
                           equal to a 6% return, compounded annually, on their
                           Initial Capital Amounts.

                           Third, 100% to the Investment Manager until the
                           Investment Manager has received aggregate
                           distributions equal to 20% of the amounts distributed
                           pursuant to the foregoing clause Second and this
                           clause Third.

                           Fourth, 80% to the holders of LLC Interests and 20%
                           to the Investment Manager. (The distribution payable
                           to the Investment Manager pursuant to the foregoing
                           clause Third and this clause Fourth is referred to as
                           the "Carried Interest").


                                       23
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           The Investment Manager's right to receive the Carried
                           Interest shall be fully vested upon the issuance of
                           such interest in recognition of the fact that, with
                           the assistance and advice of the Investment Manager,
                           New Investments LLC will have concurrently with the
                           closing of the transactions contemplated hereby
                           acquired the entire portfolio of securities (subject
                           to follow-on investments) that New Investments LLC
                           will acquire.

                           7. Board Composition and Control of New Investments
                           LLC.

                           (a) If holders of Allowed Class 5 Claims invest at
                           least $3,000,000 in the Equity Financing, the Board
                           of Managers of New Investments LLC will include the
                           following three interested managers: a representative
                           of the Berylson Investors, who shall initially be
                           John Berylson; a representative of the Smith
                           Investors, who shall initially be Richard Smith; and
                           a representative of the holders of Allowed Class 5
                           Claims who represent a majority of the LLC Interests
                           purchased by such holders. The Board of Managers will
                           also include four disinterested managers to be
                           designated prior to confirmation and who shall be
                           nominated and elected by the holders of a majority of
                           the LLC Interests in New Investments LLC. If holders
                           of Allowed Class 5 Claims do not invest at least
                           $3,000,000 in the Equity Financing, the Board of
                           Managers of New Investments LLC will include the
                           following two interested managers: a representative
                           of the Berylson Investors, who shall initially be
                           John Berylson; and a representative of the Smith
                           Investors, who shall initially be Richard Smith. In
                           such event, the Board of Managers will also include
                           three "disinterested managers" to be designated prior
                           to confirmation and who shall be nominated and
                           elected by the holders of a majority of the LLC
                           Interests in New Investments LLC. Each member of the
                           Board shall serve for a five-year term, and any
                           replacements upon resignation or removal of a member
                           shall be made by the parties entitled to appoint such
                           member in the first instance. In the event the
                           Distribution Conditions do not occur, or are not
                           waived, and accordingly the BDC Election is not made,
                           the Board of Managers may not include any
                           disinterested managers, and additional managers may
                           be appointed with the consent of a majority of the
                           holders of LLC Interests.


                                       24
<PAGE>
                                                                January 28, 2002


TERM SHEET FOR THE ACQUISITION OF GCC BY AMCE


                           (b) Pursuant to the terms of the Investment
                           Management Agreement, the Investment Manager will
                           have the discretion to make disposition decisions
                           with regard to portfolio investments held by New
                           Investments LLC, and shall also make recommendations
                           to the Board of Managers regarding additional
                           investments in such portfolio companies. The approval
                           by the Board of Managers shall be required for any
                           additional investments. There will be no limitation
                           on the types of investments that may be recommended
                           by New Manager LLC, as long as such investments are
                           in companies which are then portfolio companies of
                           New Investments LLC. The approval of the Board of
                           Managers of New Investments LLC will also be required
                           prior to New Investments LLC's reinvesting the
                           proceeds of any liquidated investments, raising any
                           capital of any kind, distributing any investments in
                           kind or retaining reserves or other amounts from the
                           cash proceeds of a liquidity event which will
                           otherwise be distributed pursuant to the distribution
                           provisions discussed above.

                           8. Voting Rights of Holders of LLC Interests. Each
                           holder of an LLC Interest is entitled to a vote
                           proportionate to such holder's percentage share of
                           the equity of New Investments LLC for the election of
                           members of the Board of Managers. All voting rights
                           for the election of such members are noncumulative,
                           which means that the holders of more than 50% of the
                           LLC Interests can elect 100% of the managers then
                           nominated for election if they choose to do so and,
                           in such event, the holders of the remaining LLC
                           Interests will not be able to elect any managers.

                           9. Board Composition of Investment Manager. The Board
                           of Managers of the Investment Manager will be such
                           individuals as may be designated by Messrs. Berylson
                           and Kouvaris, who will own 100% of the Investment
                           Manager.

Class 10 -- Common         The holders of Common Stock Options shall receive no
Stock Options:             distribution. On the Effective Date all Common Stock
                           Options and any other equity interests will be
                           canceled.


                                       25
<PAGE>
                                                                January 28, 2002


TERM SHEET -- NEW AMCE NOTES
9.5% Senior Subordinated Notes due 2011


EXISTING ISSUE:   $225 million principal amount of 9.5% Senior Subordinated
                  Notes due 2011 of AMC Entertainment Inc. (the "Notes").

ISSUER:           AMC Entertainment Inc. ("AMCE" or the "Company").

COUPON:           9.5%, payable twice annually on February 1st and August 1st.

MATURITY DATE:    February 1, 2011.

OPTIONAL          The Company may redeem the notes at its option, in whole or in
REDEMPTION:       part, at any time after February 1, 2004 at 104.75% of the
                  principal thereof, declining ratably to 100.00% of the
                  principal amount thereof on or after February 1, 2007, plus in
                  each case interest accrued to the redemption date.

CHANGE OF         Upon a Change of Control, the holders of the Notes will have
CONTROL:          the right to require AMCE to repurchase the Notes at a price
                  equal to 101% of the principal amount thereof plus accrued and
                  unpaid interest to the date of repurchase.

RANKING:          The Notes are unsecured senior subordinated indebtedness
                  ranking pari passu with all of AMCE's existing and future
                  senior subordinated indebtedness. The payment of all
                  obligations in respect of the Notes will be subordinated in
                  right of payment to the prior payment in full in cash or cash
                  equivalents of all senior indebtedness. As of June 28, 2001,
                  AMCE had approximately $73.2 million of net senior
                  indebtedness and $199 million of pari passu indebtedness
                  outstanding. In addition, the Notes are effectively
                  subordinated to all liabilities of AMCE's subsidiaries,
                  including trade payables but excluding: (i) intercompany
                  obligations; (ii) liabilities under guarantees of AMCE's
                  obligations; and (iii) obligations under operating leases and
                  other obligations not reflecting in AMCE's consolidated
                  financial statements.

CERTAIN           The indenture contains certain covenants that, among other
COVENANTS:        things, restricts AMCE's ability and the ability of AMCE's
                  subsidiaries to: (i) incur additional indebtedness; (ii) pay
                  dividends or make distributions in respect of capital; (iii)
                  purchase or redeem capital stock; (iv) enter into transactions
                  with certain affiliates; (v) become liable for any
                  indebtedness that is subordinate or junior in right of payment
                  to any


   THESE SECURITIES ARE THE SAME AS THE EXISTING PUBLICLY TRADED ISSUE, WHICH
   INDENTURE PROVIDES FOR THE ABILITY TO ADD UP TO $100 MILLION OF ADDITIONAL
SECURITIES - THIS TERM SHEET IS QUALIFIED IN ITS ENTIRETY BY THE DESCRIPTION OF
      THE NOTES IN AMCE'S SEC FILINGS, WHICH ARE INCORPORATED BY REFERENCE
<PAGE>
                                                                January 28, 2002


TERM SHEET -- NEW AMCE NOTES
9.5% Senior Subordinated Notes due 2011


                  senior indebtedness and senior in right of payment to the
                  Notes; or (vi) consolidate, merge or sell all or substantially
                  all of AMCE's assets, other than in certain transactions
                  between one or more of AMCE's wholly-owned subsidiaries and
                  AMCE.



   THESE SECURITIES ARE THE SAME AS THE EXISTING PUBLICLY TRADED ISSUE, WHICH
   INDENTURE PROVIDES FOR THE ABILITY TO ADD UP TO $100 MILLION OF ADDITIONAL
SECURITIES - THIS TERM SHEET IS QUALIFIED IN ITS ENTIRETY BY THE DESCRIPTION OF
      THE NOTES IN AMCE'S SEC FILINGS, WHICH ARE INCORPORATED BY REFERENCE
<PAGE>
                                                                January 28, 2001


EXHIBIT A - IDENTIFIED LEASES


UNIT # THEATRE NAME
   410 Pga
   414 Gwinnett Place
   421 Westdale
   449 Galleria
   466 Dublin Place
   471 Coral Square
   474 Central Park
   476 Northland
   477 Burnhaven
   482 Pinellas Square
   484 Point Nasa
   493 Regency
   499 Lindbergh
   507 Janaf
   514 Lakeside (2 Units)
   662 Wyoming Valley
   691 Columbia City
   704 Lakehurst
   713 Rutgers
   716 Deerbrook
   804 Crosscreek Mall
   806 Erie Commons
   809 Shelard Park
   829 Mercer Mall
   834 Lakeside (2 Units)
   837 Hanes Mall
   841 Wyoming Valley
   846 Lafayette Sq
   853 Merchants Walk
   861 San Mateo
   869 Sandy Springs 8
   872 Summit Park
   876 Columbia Mall
   877 Chestefield
   883 Westland
   887 Colonial
   888 Arlington Park
   889 Ridgmar Town Sq
   892 Eastland
   894 Mall Of Memphis
   901 Crossroads East
   908 Lincoln Plaza 8
   910 Esplanade Mall


 THIS LISTING OF THE IDENTIFIED LEASES IS FOR PURPOSES OF DEFINING POTENTIAL
  CLAIMS UNDER THIS TERM SHEET ONLY AND DOES NOT CREATE ANY RIGHTS IN ANY THIRD
  PARTY, INCLUDING WITHOUT LIMITATION ANY LESSORS UNDER THE IDENTIFIED LEASES
<PAGE>
                                                                January 28, 2002


EXHIBIT A - IDENTIFIED LEASES


   912 Highland 10
   915 Pembroke
   918 Gateway Center
   921 Mission Bay
   923 Hairston
   925 Fountains 8
   928 Richardson
   930 Pleasant Valley
   934 Great Hills
   939 Altamonte 8
   941 Midway Mall
   947 Lake Mary
   952 Canton Cinema
   953 Fashion Square
   954 Market 7
   955 Pittsford


   THIS LISTING OF THE IDENTIFIED LEASES IS FOR PURPOSES OF DEFINING POTENTIAL
  CLAIMS UNDER THIS TERM SHEET ONLY AND DOES NOT CREATE ANY RIGHTS IN ANY THIRD
   PARTY, INCLUDING WITHOUT LIMITATION ANY LESSORS UNDER THE IDENTIFIED LEASES