Document:

1

                                  Exhibit 10.2

                        Summary of Director Compensation

Attached is Schedule B which  details  Board of Director  and  Committee  Member
compensation. Directors that are salaried officers of the corporation receive no
director or committee compensation. Schedule B is approved annually by the Board
of Directors.

<PAGE>

                             Exhibit 10.2 Continued

                                   SCHEDULE B
                                 JANUARY 8, 2008

DIRECTORS' COMPENSATION:          Non-salaried Directors $15,000 annual retainer
------------------------          plus $1,500 per meeting attended  of Tri  City
                                  National  Bank and  $300  per meeting attended
                                  of Tri City  Bankshares  Corporation,  payable
                                  quarterly

EXECUTIVE COMMITTEE:              Annual compensation, payable quarterly:
  Ronald K. Puetz                 Ronald K. Puetz - no compensation
  William Gravitter               William Gravitter                  $17,900
  Sanford Fedderly                Sanford Fedderly                   $12,150
  Christ Krantz                   Christ Krantz                      $ 5,600

LOAN COMMITTEE:
  William Werry, Chairman         Non-salaried Directors:
  Robert W. Orth                  Chairman $750 per meeting attended
  Sanford Fedderly                Other members $500 per meeting attended
  William Gravitter               Payable quarterly
  Christ Krantz
  Ronald K. Puetz
  Scott A. Wilson

AUDIT COMMITTEE:
  William N. Beres, Chairman      Chairman $10,000 per annum, payable quarterly
  Sanford Fedderly                Non-salaried members $250 per meeting attended
  Christ Krantz                   Payable quarterly
  Brian McGarry

CRA/COMPLIANCE COMMITTEE:
  Scott A. Wilson, Chairman       Non-salaried Directors:
  David A. Ulrich, Jr.            $250 per meeting attended, payable quarterly
  Scott D. Gerardin
  Georgia Franecki
  Joseph Porter
  Michael Koenen
  William Zick
  Mark Dandrea
  Kristen GaglianoExhibit 10.3

                  Description of Consulting Arrangement Between
                       Registrant and Mr. William J. Werry

William  J.  Werry,  a retired  unit bank  President,  has been  retained  as an
independent  consultant  advising the Chairman of the  Retistrant  on a range of
matters.  His compensation is approved annually by the Board of Directors of Tri
City  National  Bank.  His current  annual  compensation  for these  services is
$16,800, payable monthly, and is in addition to his compensation as a director.Exhibit 10.4

                      Summary of Officer Bonus Arrangements
DESCRIPTION

The officers of the  Corporation  and its banking  subsidiary are eligible for a
bonus  calculated  as a percentage  of each  officer's  base  salary.  Executive
officers  of the  Corporation  participate  in the plan on the same basis as all
other  participating  officers.  The bonus is approved by the Board of Directors
and the specific  percentage  award is determined  based upon the  Corporation's
return on average assets for the  twelve-month  period ending on November 30. If
the return on assets is less than one and one quarter percent  (1.25%),  no cash
bonuses are paid under the plan.  The threshold  bonus is 2% of salary,  and the
maximum is 20% of salary.  If the Corporation were to achieve a one and one half
percent (1.50%) return on average assets,  officers would receive a bonus of 10%
of salary.

OTHER PROVISIONS

If an officer's  employment  is  terminated  for any reason  before the bonus is
paid, the officer forfeits all rights to the bonus.  This bonus arrangement does
not  give  any  officer  the  right  to be  retained  in the  employment  of the
Corporation and does not affect the right of the Corporation to terminate,  with
or without cause, any officer's  employment at any time. The Corporation has the
right to withhold from any compensation  payable to an officer,  or to cause the
officer  (or the  executor or  administrator  of his or her estate or his or her
distributee)  to make payment of, any  federal,  state,  local or foreign  taxes
required to be withheld with respect to any payment.  The Board of Directors may
amend,  alter,  suspend or discontinue the bonus arrangements as it shall at any
time or from time to time determine in its sole discretion.exhibit10_67.htm

    EXHIBIT 10.67

      ASSET PURCHASE AND SALE
AGREEMENT

       

      THIS ASSET PURCHASE AND SALE AGREEMENT
(this "Agreement") is made
and entered into as of October 8, 2007 (the “Effective Date”) by
and among PACIFIC THEATRES EXHIBITION CORP., a California corporation “Pacific”),
CONSOLIDATED AMUSEMENT THEATRES, INC., a Hawaii corporation (“Consolidated” and,
collectively with Pacific, "Seller"), and, with
respect to Section 7.9 and Articles 12 through 14 below only, MICHAEL FORMAN and
CHRISTOPHER FORMAN (collectively, the “Formans”), on the one
hand, CONSOLIDATED AMUSEMENT THEATRES, INC., a Nevada corporation (“Buyer"), and, with
respect to Sections 1.5, 2.4, 4.2, 5.6 and 14.16 and Articles 11 through 14
below only, READING INTERNATIONAL, INC., a Nevada corporation (“RDI”), on the other
hand, with reference to the following facts:

      

      A.           Pacific
or Consolidated is the tenant, among other tenancies, under the leases described
on Exhibit A-1
attached hereto (the "Leases"), which
Leases relate to those certain premises located in the States of California and
Hawaii as more particularly described in the Leases (the "Leased
Premises").

      

      B.           Seller
is engaged in the business of the ownership and operation of full length motion
picture theaters (the “Theaters”) and
associated and ancillary activities at the Leased Premises (the ownership and
operation of the Theaters, together with the conduct of the associated
activities, is sometimes referred to herein as the “Business”).

      

      C.           The
Formans indirectly own a majority of the issued and outstanding shares of
capital stock of Seller.

      

      D.           RDI
indirectly owns all of the issued and outstanding equity interests of
Buyer.

      

      E.           Subject
to the terms and conditions of this Agreement, Seller desires to sell, transfer,
convey and assign to Buyer, and Buyer desires to purchase, accept and assume
from Seller the “Purchased Assets” (as defined in Section 1.2
below).

      

      NOW, THEREFORE, in consideration of the
foregoing recitals and the mutual covenants, agreements, representations and
warranties herein contained, the parties hereby agree as follows:

      

      1.           Purchase and Sale of Assets;
Assumption of Liabilities.

      

      1.1           Purchase of
Assets.  Upon the terms and subject to the conditions
hereinafter set forth, at the “Closing” (as defined in Section 9.1 hereof),
Seller shall sell, transfer, convey and assign to Buyer, and Buyer shall
purchase from Seller, and assume certain liabilities with respect to, the
“Purchased Assets” (as defined in Section 1.2 hereof).

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      

      1.2           Definition of Purchased
Assets.  Subject to the provisions of Section 1.3 hereof, the
"Purchased
Assets" shall mean and consist of:

      

      1.2.1                      Leases and
Subleases.  All right, title and interest of Seller in, to and
under (a) the Leases (other than the Leases for “Ward Cinemas 16” and “Mililani
14” (both as defined in Exhibit A-1 attached
hereto)), and (b) the subleases described on Exhibit A-2 attached
hereto (the “Subleases”),
including, in the case of the Subleases, any and all claims held by Seller in
its capacity as the sublandlord under such Subleases;

      

      1.2.2                      Buildings, Improvements and
Fixtures.  All right, title and interest of Seller in and to
all “Buildings” (as defined in Section 1.2.4), improvements and fixtures and
located on or comprising a part of the Leased Premises (other than the Leased
Premises subject to the Leases for the Ward Cinemas 16 and the Mililani
14);

      

      1.2.3                      Included
Contracts.  All right, title and interest of Seller under (a)
the contracts and other commitments and obligations listed or described on Exhibit B attached
hereto, (b) all film rental agreements with respect to the Theaters to the
extent (i) entered into by Seller in accordance with this Agreement, and (ii) in
effect as of the Closing, and (c) to the extent assignable, all
confidentiality and similar agreements (“CDAs”) entered into
by or on behalf of Seller or its Affiliates with any Person in connection with
the possible sale of all or any part of the Purchased Assets (said contracts and
other commitments and obligations described in this Section 1.2.3 are
hereinafter referred to as the "Included Contracts");
provided, however, that, to the
extent any CDAs pertain to Excluded Assets (as defined in Section 1.3),
from and after the Closing Buyer shall, at Seller’s request, cooperate with
Seller in any reasonable arrangement to afford to Seller the full claims, rights
and benefits under such CDAs as they relate to the Excluded Assets, including
enforcement, at the cost and for the benefit of Seller, of any and all rights
against a third party thereto arising out of the breach by such third party, or
otherwise, and any amount received by Buyer or its Affiliates in respect thereof
shall be held for and paid over to Seller.

      

      1.2.4                      Seller FF&E and
Inventory.  Subject to Section 1.3 and to the rights of the
landlords under the Leases and the rights of the other parties under the
Included Contracts, all right, title and interest of Seller in and to (a) all
seats, cleaning equipment, concession equipment (including concession
refrigerators and freezers), personal computer hardware and similar office
equipment, projection and sound equipment, screens, cash registers, ticket
machines, point of sale equipment, point of sale, ticketing and concession
software, security systems and related software, signage (subject to the
obligations of Buyer under Section 7.8 hereof), arcade and similar games,
“walkie talkies,” office and training room furniture and equipment (including
the office furniture and equipment located at the Leased Premises covered by the
Leases for the Ward Cinemas 16 and Mililani 14), the furniture and equipment
located in the projection technician’s office at the Leased Premises covered by
the Lease for the “Grossmont Center 10” (as defined in Exhibit A-1 attached
hereto), coin and bill counters, and the

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      projection
supplies (other than projection xenon bulbs) located at the Leased Premises
covered by the Lease for the “Pearlridge West 16” (as defined in Exhibit A-1 attached
hereto), in each case to the extent located in or attached to the buildings
(collectively, the "Buildings") which
comprise part of the Leased Premises on the “Closing Date” (as defined in
Section 9.1), including all of the assets listed on Schedule 1.2.4
attached hereto (other than those assets listed on Schedule 1.2.4 which
are replaced between the Effective Date and the Closing Date in the ordinary
course of business consistent with past practice) (collectively, the "Seller FF&E"),
and (b) all “Included Inventory” (as defined in Section 2.3 below);

      

      1.2.5                      Included Warranties and
Permits; Theater Plans; Books and Records.  All right, title
and interest of Seller in and to all (a) municipal, state and federal
franchises, permits (including building and occupancy permits and operating
permits and licenses), licenses, waivers and authorizations, and all guaranties
and warranties, in each case (i) to the extent relating to the development,
construction, operation or maintenance of the Leased Premises, the installation
of tenant improvements or Seller FF&E at the Theaters, and (ii) to the
extent transferable, (b) plans and specifications for the Theaters and the
Leased Premises, in each case to the extent the same are in the possession of
Seller or any of Seller’s “Affiliates” (as defined in Article 12) as of the
Effective Date or come into possession of Seller or any of Seller’s Affiliates
prior to or after the Closing Date, and (c) Seller’s files for the Leases and
the Subleases, including all correspondence with the landlords, subtenants or
other counterparties thereunder and all information required to determine common
area maintenance charges and percentage rent obligations for lease years
occurring during any part of 2004, 2005, 2006 or 2007 (the “CAM and Percentage Rent
Information”), in each case to the extent the same are in the possession
of Seller or any of Seller’s Affiliates as of the Effective Date or come into
possession of Seller or any of Seller’s Affiliates prior to or after the Closing
Date, but not including any financial information or financial reports regarding
the operation of the Theaters other than the CAM and Percentage Rent
Information. Notwithstanding the foregoing, from and after the date which is
twenty-one (21) months after the Closing Date, Seller shall incur no liability
for any failure to deliver documents first obtained after the Closing Date and
which Seller would otherwise be obligated to deliver to Buyer pursuant to either
subclause (b) or (c) above so long as Seller delivers such documents to Buyer
within thirty (30) days after Buyer’s written request therefor (provided that
such written request identifies the documents so requested to be delivered with
reasonable specificity); and

      

      1.2.6                      Intellectual
Property.  All right, title and interest in and to the
“Consolidated Theatres” and “Consolidated Amusements” trade names, including all
related trademarks and service marks, trade dress, logos and  artwork,
all applications or registrations pertaining to the foregoing, and all goodwill
associated therewith (the “Consolidated
IP”).

      

      For
purposes of this Section 1.2 only, the term “Seller” shall include all current
Affiliates of Seller, with the intention that the Purchased Assets will include
all right, title and interest of each Seller and all such Affiliates in the
assets and properties described above in this Section 1.2.

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

      1.3           Excluded
Assets.  Notwithstanding anything to the contrary contained in
Section 1.2 hereof, the Purchased Assets shall not include any “Excluded
Assets.”  For purposes of this Agreement, “Excluded Assets” mean
any assets, properties or rights of Seller which are not used exclusively in
connection with the Business, and shall include, without limitation, the
following: (a) any cash, cash equivalents, certificates of deposit or other
marketable or non-marketable securities; (b) any accounts or notes receivable;
(c) any policies of insurance; (d) any vehicles; (e) any claims, settlements or
awards relating to events occurring prior to the Closing Date, (i) including any
claims against the landlords under (1) the “Kahala Lease” (as defined on Exhibit A-1 attached
hereto), and any obligations relating to any such claims, settlements or awards,
and (2) the “Ko’olau Lease” (as defined on Exhibit A-1 attached
hereto) to the extent such claim relates to reimbursement of certain amounts
paid by Seller to such landlord (the “Ko’olau Landlord”) in
connection with alterations and improvements made by the Ko’olau Landlord to the
parking areas in the vicinity of such Leased Premises during and around the year
2000, and any obligations relating to any such claims, settlements or awards,
(ii) but excluding any claims held by Seller in its capacity as sublandlord
under the Subleases (it being the intention of the parties that claims held by
Seller in its capacity as sublandlord under the Subleases be included within the
Purchased Assets); (f) any books, records or files (except to the extent
otherwise included within the Purchased Assets pursuant to Section 1.2.5); (g)
[intentionally omitted]; (h) any computer software, as well as any magnetic
tape, methodology, materials or documents relating thereto (except to the extent
otherwise included within the Purchased Assets pursuant to Section 1.2.4); (i)
any supplies, stock in trade, inventory, signs, or any other items bearing
anywhere thereon the name “Pacific,” or “Pacific Theatres,” either by itself or
in conjunction with any other words or letters (provided that, any of the
foregoing and component parts and letters of signage shall not be deemed
“Excluded Assets” to the extent (1) the name “Pacific” or “Pacific Theatres” can
and is professionally and neatly removed or covered, (2) the same can and is
used without infringing upon the “Pacific” or “Pacific Theatres” trade names or
trademarks, and (3) the same can and is used without violating the terms of the
applicable Leases); (j) any ticket stock to the extent it bears the “Pacific” or
“Pacific Theatres” name; (k) any uniforms or other clothing to the extent
bearing the “Pacific” or “Pacific Theatres” names; (l) any personal property of
Seller's employees, including, but not limited to, apparel, photographs, works
of art and memorabilia; (m) any projection xenon bulbs (other than those located
in any projection equipment on the Closing Date), (n) the “Excluded Inventory”
(as defined in Section 2.3 below) or (o) any other property not owned by Seller
or its Affiliates.  Without limiting the generality of the foregoing,
all assets, properties and rights of Seller or its Affiliates located at any
motion picture theater other than the Theaters shall be deemed Excluded Assets
for all purposes under this Agreement.

      

      1.4           Assumed
Liabilities.  Effective as of the Closing Date, Buyer shall
assume any and all liabilities and obligations of Seller under the Leases (other
than the Leases for Ward Cinemas 16 and Mililani 14), the Subleases and Included
Contracts which accrue on or after the Closing Date (the “Assumed
Liabilities”).  Except for the Assumed Liabilities and except
as otherwise specifically set forth in any of the other

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      “Transaction
Documents” (as such term is defined in Article 12), Buyer is not assuming any
other liabilities or obligations of Seller. Without limiting the generality of
the foregoing, Buyer is specifically not assuming any liability under or with
respect to (a) any pension, retirement, ERISA or other “Benefit Plan” (as such
term is defined in Article 12), including, without limitation, any union
pension, retirement or other Benefit Plan, or with respect to any liability that
may result from the withdrawal of Seller or any of its Affiliates from any
pension, retirement, ERISA or other Benefits Plan, or (b) any obligation to pay
to the landlord under the Lease for the Ward Cinemas 16 amounts for Seller’s
proportionate share of real property taxes due for periods prior to the Closing
Date.  The obligations and covenants of Buyer set forth in this
Section 1.4 and elsewhere in this Agreement shall survive the Closing
indefinitely.

      

      1.5           Assignment by
Buyer.  Subject to the terms of Section 7.1.1 below, Buyer
shall have the right to assign its right to take title at Closing to some or all
of the Purchased Assets to one or more wholly-owned direct or indirect
subsidiaries of Buyer (the “Buyer Subs”);
provided, however, that, except as provided below in this Section 1.5, no such
assignment shall relieve Buyer of its obligations under this Agreement
(including, without limitation, Section 1.4 and Article 11 hereof) or any
of the other Transaction Documents.  Buyer shall provide Seller with
written notice of such election, the identities of the Assignee Subs, and which
of the Purchased Assets are to be acquired by the Assignee Subs at least ten
(10) days prior to the Closing Date.  Notwithstanding the foregoing,
Seller and Buyer agree that at the Closing, and provided such Leases remain
included within the Purchased Assets, the Leases for the Gaslamp 15 and Carmel
Mountain Plaza (as each is defined on Exhibit A-1) shall be
assigned to one or more wholly-owned direct or indirect subsidiaries of RDI
(other than Buyer and the Buyer Subs (the “RDI Subs” and
collectively with the Buyer Subs, the “Assignee Subs”), and
not to Buyer or the Buyer Subs, and Buyer shall have no responsibility or
liability with respect to such Leases or any associated assets or
liabilities.  The parties agree that, notwithstanding any other
provision of this Agreement, RDI, and not Buyer, shall be solely responsible to
Seller for any and all obligations of Buyer under this Agreement (including,
without limitation, Section 1.4 and Article 11 hereof) with respect to the
Leases and associated assets and liabilities acquired hereunder by the RDI
Subs.

      

      1.6           Intentionally
Omitted.

      

      2.           Purchase
Price.

      

      2.1           Purchase
Price.  The purchase price for the Purchased Assets shall be
Thirty-Four Million Seven Hundred Thousand Dollars ($34,700,000), which shall be
subject to adjustment and reimbursement as hereinafter provided (the "Purchase
Price").  The Purchase Price shall be payable as
follows:

      

      2.1.1                      Deposit.  Not
later than five (5) “Business Days” (as defined in Article 12) after the
Effective Date, Buyer shall deposit with Seller a cash deposit of Two Million
Dollars ($2,000,000) (the "Deposit") by wire
transfer of immediately available funds to an account or accounts designated by
Seller concurrently

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      with the
Effective Date.  Seller shall not be required to keep the Deposit
separate from its general funds; however, Buyer shall be entitled to receive
from Seller an interest factor on the Deposit at the average interest rate
earned by Seller on its cash and cash equivalents during the period it holds the
Deposit (the “Interest
Factor”).  (a) The Deposit, along with the Interest
Factor, shall be either (i) credited against the Purchase Price at the Closing
or (ii) returned to Buyer, within five (5) Business Days, if this Agreement
is terminated prior to the Closing as provided herein and Seller is not entitled
to retain the Deposit pursuant to Section 10.2 below, or (b) the Deposit shall
be retained, and the Interest Factor paid to Buyer, by Seller pursuant to
Section 10.2 below.  If, and to the extent, the full amount of the
Deposit (if Buyer is entitled to return of the Deposit) and Interest Factor is
not paid and returned to Buyer within the five (5) Business Day period referred
to in clause (a)(ii) above or Section 10.2 below, the unpaid and unreturned
amount shall thereafter bear interest at the late interest rate provided for in
Section 2.6 hereof until such amount shall have been fully paid and returned to
Buyer.

      

      2.1.2                      Balance of Purchase
Price.  Buyer shall pay to Seller, at the Closing, the balance of
the Purchase Price by wire transfer of immediately available funds to an account
or accounts designated by Seller.  Seller shall designate the account
or accounts not less than two (2) Business Days prior to the Closing
Date.

      

      2.2           Certain Adjustments to
Purchase Price.  The Purchase Price shall be subject to
adjustment at the Closing as follows:

      

      2.2.1                      Prepaid Expenses, Prorations
and Deposits.  The Purchase Price shall be increased or
decreased as required to effectuate the proration of expenses  and
receipts (other than those adjusted pursuant to Section 2.2.2), including any
prepaid expenses and receipts, if any, under the Leases (other than the Leases
for Ward Cinemas 16 and Mililani 14), the Subleases, the Included Contracts or
other obligations to be borne pursuant to this Agreement by Seller prior to the
Closing Date and by Buyer on or after the Closing Date.  Without
limiting the generality of the foregoing, all expenses arising from the
operation of the Theaters, including, without limitation, rent (other than
“Percentage Rent” (as defined in Section 2.2.2 below)), business and license
fees, film rentals, utility charges, insurance charges, common area operating
expenses, real, excise and personal property Taxes and assessments levied
against the applicable Leased Premises, promotional fund expenses, property and
equipment rentals, concession and merchandise sales and use Taxes, sales service
charges, deposits under the applicable Leases or the Subleases, and similar
prepaid and deferred items, in each case to the extent relating to the operation
of the Theaters, shall be prorated between Buyer and Seller in accordance with
the principle that Seller shall be responsible for all expenses, costs, and
liabilities, and shall be entitled to all receipts, allocable to the period
ending prior to the Closing Date, and Buyer shall be responsible for all
expenses, costs, liabilities and obligations, and shall be entitled to all
receipts, allocable to the period on or after the Closing
Date.  Notwithstanding the preceding sentence, but subject to Section
7.7 of this Agreement, there shall be no adjustment for, or reimbursement with
respect to, any deferred revenue arising from the sale or issuance of any
“Coupons and Passes” (as defined in Section 7.7 hereof) prior to the Closing or
any other liabilities or costs directly

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

      or
indirectly attributable thereto or arising therefrom.  Buyer shall be
entitled to a credit against the Purchase Price for any deposits or advances
received by Seller from any subtenant under any of the Subleases or any
counterparty under the Included Contracts to the extent such deposits or
advances have not been returned to any such subtenant or counterparty or
recouped by any such subtenant or counterparty prior to the Closing
Date.

      

      2.2.2                      Percentage
Rent.

      

      2.2.2.1                      With
respect to any percentage rent or any other rent based on the income (gross or
otherwise) (“Gross
Income”) of the tenant (collectively, “Percentage Rent”)
payable under any Lease (other than the Leases for Ward Cinemas 16 and Mililani
14) for the applicable lease years or other periods specified thereunder (each,
a “Lease Year”)
during which the Closing occurs, the Percentage Rent (taking into account any
applicable credits or adjustments) shall be prorated between Buyer and Seller
(where Seller is responsible for the period ending immediately prior to the
Closing Date and Buyer is responsible for the period on and after the Closing
Date) such that each party shall pay when due that percent of the total
Percentage Rent payable which equals such party’s respective Gross Income with
respect to the Theater subject to such Lease divided by the total Gross Income
for such Theater for such Lease Year.  Seller shall pay to Buyer, or
Buyer shall pay to Seller, as the case may be, its pro rata share due in respect
of such estimated Percentage Rent within thirty (30) days after receipt by the
paying party of the appropriate statements evidencing the amount
thereof.

      

      2.2.2.2                      With
respect to any Percentage Rent payable by the subtenant under any Sublease for
the applicable Lease Year during which the Closing occurs, the Percentage Rent
(taking into account any applicable credits or adjustments) shall be prorated
between Buyer and Seller (where Seller is entitled to any Percentage Rent for
the period ending immediately prior to the Closing Date and Buyer is entitled to
any Percentage Rent for the period on and after the Closing Date) such that (a)
Seller receives the total Percentage Rent due for such Lease Year multiplied by
a fraction, the numerator of which is the total number of days in such Lease
Year occurring prior to the Closing Date and the denominator of which is the
total number of days in such Lease Year, and (b) Buyer receive the remaining
Percentage Rent due for such Lease Year.  Seller shall pay to Buyer,
or Buyer shall pay to Seller, as the case may be, its pro rata share due in
respect of such estimated Percentage Rent within thirty (30) days after receipt
by the paying party of the appropriate statements evidencing the amount
thereof.

      

      2.2.2.3                      Any
dispute arising under this Section 2.2.2 shall be resolved in accordance with
the procedures set forth in Section 2.2.3.3 and 2.2.3.4.

      

      2.2.3                      Manner of Determining
Adjustments. The Purchase Price, taking into account the adjustments and
prorations pursuant to this Section, will be determined finally in accordance
with the following procedures:

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      2.2.3.1  Seller shall
prepare and deliver to Buyer not later than five (5) Business Days before the
Closing Date an itemized preliminary settlement statement (the “Preliminary Settlement
Statement”) which shall set forth Seller’s good faith estimate of the
adjustments to the Purchase Price in accordance with Section 2.2.1
hereof.

      

      2.2.3.2  If Seller and Buyer
have not agreed upon a final settlement statement on or before the Closing Date,
then Seller and Buyer shall cooperate in good faith to finalize such settlement
statement as soon as practicable after the Closing; provided, however, the
parties shall use such Seller’s good faith estimated adjustments to the Purchase
Price as set forth in the Preliminary Settlement Statement delivered pursuant to
Section 2.2.3.1 above for purposes of determining the amount of any estimated
adjustment to the Purchase Price paid by Buyer to Seller at
Closing.  If Seller and Buyer have not agreed upon a final settlement
statement on or before the Closing Date, not later than sixty (60) days after
the Closing Date, Buyer shall deliver to Seller a statement (the “Buyer Adjustment
Statement”) setting forth, in reasonable detail, its determination of the
adjustments to the Purchase Price and the calculation thereof and reminding
Seller of the thirty (30) day response period set forth in Section
2.2.3.3.  If Buyer fails to deliver the Buyer Adjustment Statement to
Seller within the sixty (60) day period specified in the preceding sentence,
Seller’s determination of the adjustments to the Purchase Price as set forth in
the Preliminary Settlement Statement shall be conclusive and binding on the
parties as of the last day of the sixty (60) day period.

      

      2.2.3.3  If Seller disputes
Buyer’s determination of the adjustments to the Purchase Price, it shall deliver
to Buyer a statement notifying Buyer of such dispute within thirty (30) days
after its receipt of the Buyer Adjustment Statement.  If Seller
notifies Buyer of its acceptance of the Buyer Adjustment Statement, or if Seller
fails to deliver its statement within the thirty (30) day period specified in
the preceding sentence, Buyer’s determination of the adjustments to the Purchase
Price as set forth in the Buyer Adjustment Statement shall be conclusive and
binding on the parties as of the earlier of the date of notification of such
acceptance or the last day of the thirty (30) day period, and the appropriate
party shall promptly pay to the other party in immediately available funds the
amount of any such adjustment.

      

      2.2.3.4  Seller and Buyer
shall use good faith efforts to resolve any dispute involving the determination
of any adjustments to the Purchase Price, and each party shall afford the other
party and its representatives reasonable access to all appropriate books,
records and statements relating to the subject matter of
the  adjustments to the Purchase Price contemplated by this Section
2.2 for such purpose.  If the parties are unable to resolve the
dispute within sixty (60) days after Buyer delivers the Buyer Adjustment
Statement to Seller, Seller and Buyer jointly shall designate an independent
accounting firm that has, or a movie theater executive who has, consistent and
recent experience in the finances of movie theaters similar to the Theaters (the
“Designated
Arbitrator”) to resolve the dispute.  If, for any reason, the
parties are unable to agree upon the Designated Arbitrator within seventy-five
(75) days after Buyer delivers the Buyer Adjustment Statement to Seller, or the
Designated Arbitrator fails or refuses to accept such engagement within fifteen
(15) days after the parties’ written request therefor, Seller and Buyer shall
jointly designate the Los Angeles office of PriceWaterhouseCoopers (the “Replacement
Arbitrator”) to resolve the dispute.  If the Replacement
Arbitrator fails or 

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      refuses
to accept such engagement, in either case within fifteen (15) days after the
parties’ written request therefor, either Seller or Buyer may thereafter
petition the Superior Court of Los Angeles County, California for the
appointment of an independent accounting firm to act as the Replacement
Arbitrator and resolve the dispute. Absent fraud or manifest error, (a) the
Designated Arbitrator’s or Replacement Arbitrator’s, as applicable, resolution
of the dispute shall be final and binding on the parties, (b) subject to
Sections 2.4 and 2.5, the appropriate party shall promptly pay to the other
party in immediately available funds the amount of any such adjustment, and (c)
a judgment may be entered in any court of competent jurisdiction if such amount
is not so paid.  Any fees and costs of the Designated Arbitrator or
Replacement Arbitrator shall be split equally between the parties.

      

      2.3           Reimbursement.  At
least thirty (30) days prior to the Closing Date, Seller shall provide Buyer
with a list of all concession inventory and consumables (including, without
limitation, all food, beverages, candy, ticket stock, cups, bags, paper goods
and related items), and janitorial supplies (collectively, “Theater Inventory”),
then on hand at the Theaters.  Within five (5) Business Days after its
receipt of such list, Buyer shall provide written notice to Seller of those
categories of Theater Inventory Buyer elects to exclude from the Purchased
Assets (the “Excluded
Inventory”).  All Theater Inventory (other than the Excluded
Inventory) on hand on the Closing Date shall be included in the Purchased Assets
(the “Included
Inventory”), and Buyer shall reimburse to Seller an amount equal to
Seller’s cost of all Included Inventory on hand at the Closing Date, as set
forth in written inventories prepared by Seller’s theater managers at each of
the Theaters as of the close of business on the day immediately preceding the
Closing Date.  Any dispute regarding the reimbursement pursuant to
this Section 2.3 shall be resolved by the Designated Arbitrator or the
Replacement Arbitrator pursuant to the mechanism set forth in Section 2.2.3.4,
and each party shall afford the other party and its representatives reasonable
access to all appropriate books, records and statements relating to the subject
matter of the reimbursement contemplated by this Section 2.3 for such
purpose.

      

      2.4           Adjustment for Exclusion of
Kukui Lease.  If the Closing occurs, but the Lease for Kukui
Mall 4 (defined on Exhibit A-1) (the
“Kukui Lease”)
is not assigned to Buyer solely by reason of the fact that the landlord under
the Kukui Lease (the “Kukui Landlord”) has
failed to consent to the assignment thereof or exercises its “recapture” rights
under the Kukui Lease (the “Recapture Rights”),
(a) the Purchase Price shall be increased at the Closing by $840,000,
(b) the Kukui Mall 4 Lease shall be excluded from the Purchased Assets, and
(c) if the Kukui Landlord neither consents to the assignment thereof nor
exercises the Recapture Rights, the Kukui Lease shall be subject to Section
7.1.4 below.  Any increase in the Purchase Price pursuant to this
Section 2.4 shall be paid by Buyer to Seller at the Closing as provided in
Section 2.1.2; provided, however, that Seller
also shall increase the amount of the “Loans” (as defined in Section 5.6) made
at the Closing by the amount of such increase in the Purchase Price, 

        
          
             

          

          
            9

            
              

            

          

          
             

          

        

      and the
parties agree such increase in the amount of the Loans shall be evidenced by
increasing the initial principal amount of the “Two Year Note” (as defined in
Section 5.6 below) at the Closing.

      

      2.5           Payment of Adjustments to
and Reimbursements of the Purchase Price.  If, pursuant to
Sections 2.2 or 2.3, it is determined after the Closing Date that Buyer shall be
obligated to pay any amounts to Seller, then Buyer shall make such payments in
full to Seller within ten (10) days after such amount is finally determined to
be due.  Conversely, if, pursuant to Sections 2.2 or 2.3, it is
determined after the Closing Date that Seller shall be obligated to pay any
amounts to Buyer, then such amounts shall be credited against RDI’s obligations
to Seller under the “Notes” (as defined in Section 5.6) in the following order
and priority: (a) first, against the then outstanding principal balance
under the “Five Year Note” (as defined in Section 5.6, below),
(b) second, against the then outstanding principal balance under the Two
Year Note, (c) third, against any accrued interest under the Five Year
Note, and (d) last, against any accrued interest under the Two Year Note;
provided, however, if after
application of such amounts due against the Notes, there remains amounts due
from Seller to Buyer, then Seller shall pay all such remaining amounts in full
to Buyer within ten (10) days after such amounts are finally determined to be
due.

      

      2.6           Late Interest.  If
any amount payable pursuant to the provisions of this Article 2 is not paid
within ten (10) days after such amount is finally determined to be due, such
amount shall thereafter accrue interest until paid in full at an annual rate
equal to the lesser of the “prime” interest rate as announced by The Wall Street Journal from
time to time during such period plus 2%, or the maximum interest rate permitted
by applicable law.

      

      2.7           Allocation of Purchase
Price.  Attached hereto as Schedule 2.7 is an
allocation (the “Allocation”) of the
Purchase Price among the Purchased Assets.  Buyer and Seller shall (a)
be bound by the Allocation for all Tax purposes; (b) prepare and file all Tax
returns (including IRS Form 8594 and any required exhibits thereto, and any
amendments thereto) in a manner consistent with the Allocation; and (c) take no
position inconsistent with the Allocation in any Tax return or in any proceeding
before any taxing authority.  In the event that the Allocation is
disputed by any taxing authority, the party receiving notice of such dispute
shall promptly notify and consult with the other parties and keep the other
parties apprised of material developments concerning resolution of such
dispute.

      

      2.8           Survival.  The
parties’ respective obligations under this Article 2 shall survive the
Closing.

      

      3.           Representations and
Warranties of Seller.

      

                            3.1           Representations and
Warranties of Seller.  Seller hereby represents and warrants to
Buyer as follows:

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      3.1.1                      Organization.  Pacific
is a corporation duly organized, validly existing and in good standing under the
laws of the State of California, and Consolidated is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Hawaii. Each of Pacific and Consolidated has all requisite power to own, lease
and license its properties and assets and to carry on its business in the manner
and in the places where such properties and assets are owned, leased, licensed
or operated or such business is conducted.

      

      3.1.2                      Authority.  Subject
to the terms of any consent provisions of the Leases and the Included Contracts,
each of Pacific and Consolidated has full right, power and authority to enter
into this Agreement and to perform its obligations hereunder. The entry into and
performance of this Agreement have been duly authorized by all necessary action
on the part of each of Pacific and Consolidated in accordance with its Articles
of Incorporation and Bylaws and applicable law.  This Agreement
constitutes, and each other document, instrument and agreement to be entered
into by Pacific or Consolidated pursuant to the terms of this Agreement will
constitute, a valid agreement binding upon and enforceable against such entity
in accordance with its terms (except as limited by bankruptcy or similar laws or
the availability of equitable remedies).

      

      3.1.3                      Consents.  Except
as set forth in Schedule 3.1.3
attached hereto, the execution, delivery and performance by Pacific and
Consolidated of this Agreement, and all other agreements, instruments or
documents referred to herein or contemplated hereby, do not require the consent,
waiver, approval, license or authorization of any Person (other than the
landlords under the Leases) or public authority which has not been obtained or
provided for in this Agreement and do not and will not contravene or violate
(with or without the giving of notice or the passage of time or both), the
Articles of Incorporation or Bylaws of such entity, any other contract or
agreement to which such entity is a party or by which such entity is bound or
any judgment, injunction, order, law, rule or regulation applicable to such
entity. Neither Pacific nor Consolidated is a party to, or subject to or bound
by, any judgment, injunction or decree of any court or governmental authority
which may restrict or interfere with the performance of this Agreement, or such
other agreements, instruments and documents.

      

      3.1.4                      Good
Title.  Except for Liens granted to Bank of America, N.A., as
Administrative Agent (all of which Liens shall be released on or prior to the
Closing Date), Seller has, and on the Closing Date will have, good title in and
to or valid leasehold interests in, all of the Purchased Assets (other than the
Leased Premises and its interests in the Leases and the Subleases) free and
clear of any “Liens” (as such term is defined in Article 12), ownership
interests or rights to acquire, other than the “Permitted Liens” (as such term
is defined in Article 12).   Notwithstanding the foregoing, but
subject to Section 11.2.4 below, no representation or warranty is made with
respect to the title to any point of sale, ticketing, concession or other
computer software included in the Purchased Assets.

      

      3.1.5                      The
Leases.   Exhibit A-1 sets
forth a true, complete and accurate list of all Leases (including all
amendments, extensions, renewals, ground or

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      master
lessor consents, existing non-disturbance and attornment agreements with respect
thereto), and Exhibit
A-2 sets forth a true, complete and accurate list of all Subleases
(including all amendments, extensions, renewals, ground or master lessor
consents, existing non-disturbance and attornment agreements and guaranties with
respect thereto).  Subject to the terms of the Leases and the
Subleases, Seller has, and on the Closing Date will have, valid leasehold
interests in the Leases and the Subleases free and clear of any Liens other than
(a) Permitted Liens, (b) so-called “non-monetary” Liens, including, without
limitation, any ground or underlying leases, easements, parking agreements,
reciprocal easement agreements, conditions, covenants and restrictions,
restrictive covenants, development or similar agreements, zoning limitations and
other restrictions imposed by any Governmental Authority, or any other matter
which a survey of the Leased Premises or a review of the public records
regarding the Leased Property would show, whether created by or in the name of
Seller or any other party, or (c) any other Liens, whether “monetary” or
“non-monetary” Liens, created by or in the name of any Person other than Seller
or any Affiliate of Seller, including, without limitation, by any fee owner or
ground lessor under the Leases or any subtenant under the
Subleases.  True, complete and accurate copies of the Leases and the
Subleases, as well as any and all existing guaranties of Seller or its
Affiliates with respect thereto, have been delivered or otherwise made available
to Buyer through Seller’s data site operated by Merrill Corporation (the “Data Site”), and such
Leases and Subleases set forth the entire agreement and understanding between
the parties thereto with respect to the leasing or subleasing, as applicable,
and occupancy of the Leased Premises.  Each such Lease and Sublease is
in full force and effect against the applicable Seller and is valid and binding
against the applicable Seller and, to Seller’s Knowledge, the applicable
landlord or subtenant thereunder.  Except as set forth on Schedule 3.1.5,
neither Seller nor, to Seller’s Knowledge, any landlord under the Leases or any
subtenant under the Subleases is in default under the Leases or the Subleases,
as applicable, nor has any event occurred or failed to occur or any action been
taken or not taken which, with the giving of notice, the passage of time or both
would mature into or otherwise become a default under the Subleases or the
Leases by Seller or, to Seller’s Knowledge, the applicable landlord or subtenant
thereunder.  Except as set forth on Schedule 3.1.5, no
landlord under any Lease or subtenant under any Sublease is an “Affiliate” (as
such term is defined in Article 12) of either Seller.  Except for the
Subleases and except as set forth on Schedule 3.1.5,
Seller has not subleased, licensed or otherwise granted any “Person” (as such
term is defined in Article 12) the right to use or occupy the Leased Premises or
any portion thereof and the Seller is in exclusive possession of the Leased
Premises.   To Seller’s Knowledge, there is no pending or
threatened condemnation of any part of any Leased Premises by any “Governmental
Authority” (as such term is defined in Article 12).

      

      3.1.6                      Improvements.  Since
January 1, 2005, with respect to the Business or the Purchased Assets or the
Leased Premises, neither Seller nor its Affiliates has not received any written
notice of, and otherwise has no Knowledge of, any violation of any applicable
federal, state or local laws (other than any applicable “Environmental Laws” (as
defined in Article 12) or the “ADA” (as defined below)), building ordinances, or
health and safety ordinances, which has not been cured in all material
respects.  Since January 1, 2005, with respect to the Business or the
Purchased Assets or the Leased

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      Premises,
Seller has not received any written notice from any Governmental Authority, or
to the actual knowledge of Ira Levin and Jay Swerdlow (who, for this purpose
only, shall be deemed to actually know of all information in their respective
business and personal files maintained with respect to the Purchased Assets and
the Business) any other Person, of any violation of any applicable Environmental
Laws or the Americans with Disabilities Act, 42 U.S.C. 12101 et seq. or similar
or comparable state or local laws (collectively, the “ADA”).  Except
as expressly set forth in the immediately preceding sentence, no representation
or warranty is made that any Leased Premises or any improvements made by or
constructed for Seller or any third party is in compliance with Environmental
Laws or the ADA.  Except as set forth in Schedule 3.1.6 and
except for the improvements covered or to be covered by the repairs described in
Section 7.3.2 below, to Seller’s Knowledge, since January 1, 2005, no
improvements on the Leased Premises have suffered any material casualty or other
material damage that has not been repaired in all material
respects.  Notwithstanding the foregoing, the parties acknowledge and
agree that Seller shall not be deemed in breach of the representation and
warranty set forth in the immediately preceding sentence by reason of any
asserted casualty or damage to any such improvements that were set forth in any
written inspection report provided by Buyer to Seller prior to the Effective
Date.

      

      3.1.7                      Material
Contracts.  Schedule 3.1.7 sets
forth a complete and correct list of the following Included Contracts: (a) all
contracts requiring annual payments in excess of $100,000; (b) all contracts
whose term is greater than one (1) year and which may not be terminated upon
thirty (30) days or less notice without penalty; (c) all contracts with
Affiliates of either Seller; and (d) all non-competition and non-disclosure
agreements to which either Seller is subject other than non-competition and/or
non-disclosure agreements set forth in the Leases or the CDAs (collectively, the
“Material
Contracts”). True, complete and accurate copies of the Material Contracts
have been delivered or otherwise made available to Buyer through the Data Site,
and such Material Contracts set forth the entire agreement and understanding
between the parties thereto with respect to the subject matter
thereof.  Each Material Contract is in full force and effect against
the applicable Seller and is valid and binding against the applicable Seller
and, to Seller’s Knowledge, the other parties thereunder.  Except as
set forth on Schedule
3.1.7, neither Seller nor, to Seller’s Knowledge, any other party to the
Material Contracts is in default under any of the Material Contracts, nor has
any event occurred or failed to occur or any action been taken or not taken
which, with the giving of notice, the passage of time or both would mature into
or otherwise become a default under any of the Material Contracts by Seller or,
to Seller’s Knowledge, the other parties thereunder.

      

      3.1.8                      Compliance with
Law.  Except as set forth in Schedule 3.1.8, since
January 1, 2005, to Seller’s Knowledge, the operation of the Business and the
Leased Premises has been conducted in accordance with all applicable laws,
rules, codes, injunctions, decrees, rulings, regulations, orders and other legal
requirements of all Governmental Authorities, the failure to comply with which
could have a Material Adverse Effect.  Except as set forth in Schedule 3.1.8, since
January 1, 2005, neither Seller nor its Affiliates have received written notice
of any material violation of any such law, regulation, order or other legal
requirement.  Neither Seller nor its Affiliates is in

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      default
with respect to any order, writ, judgment, award, injunction or decree of any
Governmental Authority applicable to the Business or any of the Purchased Assets
or the Leased Premises which has not been cured in all material respects, nor
has any event occurred or failed to occur or any action been taken or not taken
which, with the giving of notice, the passage of time or both would mature into
or otherwise become such a default.  Except as set forth in Schedule 3.1.8, to
Seller’s Knowledge, neither Seller nor its Affiliates is under investigation
with respect to any purported violation of (a) any law, regulation, order or
other legal requirement, or (b) any order, writ, judgment, award, injunction or
decree of any Governmental Authority applicable to the Business or any of the
Purchased Assets or the Leased Premises.  No representation or
warranty is hereby made by virtue of this Section 3.1.8 in respect of any
matters covered by Sections 3.1.6 or 3.1.10.  Additionally, and
notwithstanding anything to the contrary contained in this Agreement or in any
of the other Transaction Documents, (a) no representation or warranty is made
with respect to the compliance of the Theaters’ point of sale ticketing,
concession or other computer software systems with the Fair and Accurate Credit
Transaction Act of 2003, as the same is amended from time to time (“FACTA”), or any
similar federal, state or local law, (b) Buyer acknowledges that Seller has
advised Buyer that the Theaters and the Business will not be Payment Card
Industry (“PCI”) compliant from
and after December 31, 2007, and (c)  Seller shall be under no
obligation to take any action either prior to or after the Closing to cause the
Business or any of the Purchased Assets to comply with FACTA or any similar
federal, state or local law, or make the Theaters or the Business PCI compliant,
and shall have no liability to Buyer if no such actions are taken.

      

      3.1.9                      Litigation.  Except
as set forth in Schedule 3.1.9, to
Seller’s Knowledge, there are no actions, suits, claims, proceedings, hearings,
disputes or investigations currently pending or threatened in writing at any
time after January 1, 2005, before any Governmental Authority or that would come
before any arbitrator, brought by or against Seller involving, affecting or
relating to the Business or any of the Purchased Assets, including, without
limitation, any labor, employment or Tax-related actions, suits, claims,
proceedings, hearings, disputes or investigations.  Seller is not
subject to any order, writ, assessments, judgment, award, injunction or decree
of any Governmental Authority relating to the Business or any of the Purchased
Assets. Notwithstanding the foregoing, Seller makes no representation in this
Section 3.1.9 regarding the subject matter of the second sentence of
Section 3.1.6.

      

      3.1.10                      Labor
Matters.  

      

      3.1.10.1                      Employment and Collective
Bargaining Agreements.  Except as set forth in Schedule 3.1.10: (a)
neither Seller nor its Affiliates is a party to any outstanding employment or
consulting agreements or change in control contracts with any “Affected
Employee” (as such term is defined in Article 8) that is not terminable at will
without payment of compensation beyond what is owed for services performed
through the date of termination, or that require the payment of any bonus or
commission; (b) there are no collective bargaining agreements or memoranda of
understanding or appendices relating to any collective bargaining agreements
governing

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

      the terms
or conditions of employment of the Affected Employees (to the extent set forth
on Schedule
3.1.10, the items described in this clause (b) are referred to herein as
the “Collective
Bargaining Agreements”); and (c) to the Seller’s Knowledge, since January
1, 2005, there have not been any organizational activities with respect to the
Affected Employees not covered by a Collective Bargaining Agreement, nor are
there any pending or, to Seller’s Knowledge, threatened activities or
proceedings of any labor union to organize any such employees.

      

      3.1.10.2                      No
Obligation.  Neither Seller nor its Affiliates has any
obligation, either pursuant to applicable law, contract or Collective Bargaining
Agreement, to obligate Buyer to offer employment to or employ any of the
Affected Employees, or to obligate Buyer to assume any of the Collective
Bargaining Agreements listed on Schedule
3.1.10.

      

      3.1.10.3                      Compliance with Labor and
Employment Laws.  Except as set forth in Schedule 3.1.10: (a)
[intentionally omitted]; (b) there is no unfair labor practice charge, other
charge or complaint pending before any federal or state Governmental Authority
or in the Collective Bargaining Agreement grievance process or, to Seller’s
Knowledge, threatened, brought by or on behalf of any of the Affected Employees
or former employees of Seller who are or were employed in connection with the
operation of the Business or any current or former collective bargaining unit
representing any Affected Employees or former employees of the Seller who were
employed in connection with the operation of the Business; (c) there is no labor
strike or slowdown, work stoppage or lockout, pending or, to Seller’s Knowledge,
threatened against or affecting the Business, and since January 1, 2005, Seller
has not experienced any strike, slow down or work stoppage, lockout or other
collective labor action against or affecting the Business; and (d) there is no
representation, claim or petition pending before the NLRB or any similar state
agency against or with respect to the Business.

      

      3.1.11.                      Certain Tax
Matters.  Neither Pacific nor Consolidated is  a
“foreign person” within the meaning of Code Section 1445(f) or a “foreign
partner” within the meaning of Code Section 1446.  None of the
Purchased Assets is “tax-exempt use property” within the meaning of Code Section
168(h).

      

      3.1.12                      Theater
P&Ls.  Attached hereto as Schedule 3.1.12 are
the Theater Level Cash Flow Reports for the Theaters for Seller’s fiscal year
ended June 28, 2007 and for the two (2) month period ended August 30, 2007
(collectively, the “Theater
P&Ls”).  Except as set forth in Schedule 3.1.12, the
Theater P&Ls present fairly in all material respects the results of
operations for the Theaters along with circuit revenue and expenses allocated to
each region based on attendance, for the periods referred to
therein.  Seller maintains its books and records in accordance with
GAAP applied on a consistent basis, and the Theater P&Ls were prepared from
and are consistent with such books and records.  However, the Theater
P&Ls do not include the FASB 13 adjustment for straight-line rent required
under GAAP.  Additionally, the Theater P&Ls exclude certain
financial statements and lack the footnote disclosures that are required for
GAAP.  

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

      3.1.13                      Affiliate
Transactions.  Except as set forth on Schedule 3.1.13
attached hereto, (a) Seller is not a party to any contract or arrangement with,
or indebted, either directly or indirectly, to any of its Affiliates in
connection with the Business or any of the Purchased Assets, and (b) none of
Seller’s Affiliates own any asset, tangible or intangible, which is used in and
material to the operation of the Business or any of the Purchased
Assets.

      

      3.1.14                      Brokerage.  Except
with respect to the engagement of Lazard Freres & Co. LLC, Seller has not
employed any broker, finder or agent or has incurred or will incur any
obligation or liability to any broker, finder or agent with respect to the
transactions contemplated by this Agreement, and all fees and expenses payable
in connection with the engagement of Lazard Freres & Co. LLC will be paid by
Seller.

      

      3.1.15                      Employee
Benefits.  Seller acknowledges that Buyer does not intend to
maintain any of Seller’s Benefit Plans after the Closing and that, consequently,
neither Buyer nor any ERISA Affiliate of Buyer shall ever have any obligation to
make any payments, contributions or transfers in respect of, or have any
liability with respect to, any such Benefit Plan.  By way of example
and not limitation, if and to the extent that Seller incurs, or ever has
incurred, “withdrawal liability” within the meaning of ERISA Section 4201 with
respect to any such Benefit Plan that is a Multiemployer Plan (as defined in
Section 3(37) of ERISA), neither Buyer nor any ERISA Affiliate of Buyer shall
incur any such liability, and Seller shall satisfy such withdrawal liability in
full.

      

      3.1.16                      Trade Names and
Trademarks.  Seller has granted no right or license to any
other Person to make use of the trade names or trademarks “Consolidated
Theatres” or “Consolidated Amusements,” and has no Knowledge that any other
Person has or claims any interest in such marks; provided, however, that Seller
has Knowledge that the name “Consolidated Theatres” is being used by a theater
circuit currently headquartered in Charlotte, North Carolina.

      

      3.1.17                      Development
Projects.  None of the “Selling Parties” (as defined in Section
7.9.1), nor any Affiliate of any of the Selling Parties, is bound by any
agreement or commitment regarding the development, construction or operation of
any proposed development that is currently contemplated to include a commercial
motion picture theater in any part of the “Territory” (as defined in Article 12
below), except that no representation or warranty is made hereby with respect to
the development, construction or operation of any proposed motion picture
theater development within the “Exception Area” (as defined in Section 7.10.1
below).

      

      3.2           Knowledge.

      Where any
representation or warranty contained in this Agreement is expressly qualified by
reference “to Seller’s Knowledge,” “to the Knowledge of Seller,” or any similar
language, it refers to the actual knowledge of Neil Haltrecht (Executive Vice
President of Seller), Nora Dashwood (Executive Vice President and Chief
Operating Officer of Seller), Jay Swerdlow (Executive Vice

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

      President
of Seller), Ira Levin (Executive Vice President and General Counsel of Seller),
Joe Miraglia (Director of Staff Operations of Seller), and Terri Shimohara (Vice
President, Human Resources of Seller), in each case after due
inquiry.

      

      3.3           “As Is” Purchase.
BUYER ACKNOWLEDGES THAT AS A MATERIAL CONDITION OF THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT, BUYER IS ACQUIRING THE PURCHASED ASSETS ON AN “AS IS, WHERE
IS” BASIS EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS
AGREEMENT.  EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THERE ARE
NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, BUT NOT LIMITED TO,
REPRESENTATIONS AS TO THE PHYSICAL OR OTHER CONDITION OF THE LEASES, THE LEASED
PREMISES, OR THE OTHER PURCHASED ASSETS, OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE LEASES,
THE LEASED PREMISES OR THE OTHER PURCHASED ASSETS. BUYER HAS MADE AND AGREES TO
MAKE A THOROUGH AND CAREFUL EXAMINATION OF THE LEASES, THE LEASED PREMISES AND
THE OTHER PURCHASED ASSETS AND WILL ASSURE ITSELF THAT THE LEASES, THE LEASED
PREMISES AND THE OTHER PURCHASED ASSETS ARE SUITABLE FOR BUYER’S INTENDED
PURPOSE.  IF THE CLOSING OCCURS, AND SUBJECT TO THE SPECIFIC AND
EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED HEREIN, (A) BUYER SHALL BE
DEEMED TO HAVE ACCEPTED THE APPLICABLE LEASES, THE LEASED PREMISES AND THE OTHER
PURCHASED ASSETS WITH AND SUBJECT TO ALL DEFECTS AND DEFICIENCIES, AND (B) BUYER
EXPRESSLY ASSUMES THE RISK THAT SUBSEQUENT EVENTS OR UNDISCOVERED OR UNKNOWN
CONDITIONS COULD MAKE ALL OR PART OF THE APPLICABLE LEASES, THE LEASED PREMISES
OR THE OTHER PURCHASED ASSETS UNSUITABLE FOR BUYER’S INTENDED
PURPOSES.

      

      3.4           Release.  As
a material inducement to Seller to enter into and perform its obligations under
this Agreement, Buyer, on behalf of itself and all of its successors, assigns,
Affiliates and representatives, hereby releases and discharges Seller, the
Formans, their respective Affiliates, and their respective officers, directors,
shareholders, partners, members, managers, employees, agents, attorneys and
representatives, and successors and assigns, from any and all claims, demands,
liabilities, obligations, expenses (including attorneys' fees), causes of
action, suits and rights, whether now known or unknown, suspected or
unsuspected, which exist, existed or may exist or have existed at any time now
or in the future and arising out of or relating to the physical condition of the
Purchased Assets, including, without limitation, in connection with any
compliance or non-compliance by Seller or any other party with the ADA or any
similar state or local law, or arising from the presence of any Hazardous
Materials or the Purchased Assets’ or any party’s compliance with any
Environmental Laws; provided, however, that the foregoing release shall not
apply to any claim to the extent arising from (a) the breach of any express
covenant, representation or warranty by Seller under this Agreement or
(b) fraud committed by Seller or any Affiliate of Seller.  The
foregoing release extends to, and Buyer hereby waives and relinquishes, all of
its rights

      
        
           

        

        
          17

          
            

          

        

        
           

        

      

      under
Section 1542 of the California Civil Code and any similar law or rule of any
other jurisdiction.  California Civil Code Section 1542
provides:

      

      "A
general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her must have materially affected his or her settlement with
the debtor."

      

      3.5           Updating of
Schedules.  Seller shall, from time to time, prior to the
Closing, update the Schedules to this Agreement, or create any new
schedules revising its representations and warranties, if after the Effective
Date Seller learns of new exceptions to the representations and warranties set
forth in this Agreement (together, the "Updated Schedules"),
and promptly deliver such Updated Schedules to Buyer.  If any Updated
Schedule reflects or describes a Material Adverse Effect from the
conditions previously described in the representations and warranties,
then Buyer may, at its option, upon written notice thereof to Seller,
within ten (10) Business Days of Buyer's receipt of an Updated
Schedule, terminate this Agreement upon notice to the other
parties.  If Seller's representations and warranties were true and
correct when made, then Buyer's sole remedy in the event of the receipt of
an Updated Schedule shall be to terminate this Agreement in accordance with
the foregoing sentence (or to proceed with the Closing).  If the then
scheduled Closing Date would occur prior to the end of the ten (10) Business
Days period set forth in this Section 3.5, the delivery of any Updated Schedule
shall postpone the Closing Date to the date which is ten (10) Business Days
after Buyer’s receipt of such Updated Schedule.

      

      4.           Representations and
Warranties of Buyer and RDI.

      

      4.1           Representations and
Warranties of Buyer.  Buyer hereby represents and warrants to
Seller as follows:

      

      4.1.1                      Organization.  Buyer
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Nevada.  Buyer has all requisite power to own,
lease and license its properties and assets and to carry on its business in the
manner and in the places where such properties and assets are owned, leased,
licensed or operated or such business is conducted.

      

      4.1.2                      Authority.  Buyer
has full right, power and authority to enter into this Agreement and to perform
its obligations hereunder. The entry into and performance of this Agreement has
been duly authorized by all necessary action on the part of Buyer in accordance
with its governing documents and applicable law, and this Agreement constitutes,
and each other document, instrument and agreement to be entered into by Buyer
pursuant to the terms of this Agreement will constitute, a valid agreement
binding upon and enforceable against Buyer in accordance with its terms (except
as limited by bankruptcy or similar laws or the availability of equitable
remedies).

      

      4.1.3                      Consents.  The
execution, delivery and performance by Buyer of this Agreement, and all other
agreements, instruments and documents referred

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

      to or
contemplated herein or therein do not require the consent, waiver, approval,
license or authorization of any Person (other than the landlords under the
Leases and any lenders having Liens on the Leased Premises) or public authority
which has not been obtained and do not and will not contravene or violate (with
or without the giving of notice or the passage of time or both) the governing
documents of Buyer or any judgment, injunction, order, law, rule or regulation
applicable to Buyer. Buyer is not a party to, or subject to or bound by, any
judgment, injunction or decree of any court or governmental authority or any
lease, agreement, instrument or document which may restrict or interfere with
the performance by Buyer of this Agreement, or such other leases, agreements,
instruments and documents.

      

      4.1.4                      Financial Condition.
Buyer is a newly formed entity, created for the purpose of effectuating the
transactions contemplated by this Agreement.  On the Closing Date and
after giving effect to the transactions contemplated by this Agreement, (a)
Buyer will have shareholders’ equity (determined in accordance with GAAP) of not
less than Twenty Million Dollars ($20,000,000), (b) the assets of Buyer shall
include all right, title and interest of the tenant under the lease for RDI’s
movie theater in Manville, New Jersey (the “Manville Theater”),
and (c) Buyer will not have indebtedness for borrowed money in excess of the
aggregate amount of Fifty-Five Million Dollars
($55,000,000).  Attached hereto as Schedule 4.1.4 are
(i) a true and complete summary of the material terms of the Lease for the
Manville Theater, and (ii) Theater Level Cash Flow Reports for the Manville
Theater for RDI’s fiscal year ended December 31, 2006 and for the
eight-month period ended August 31, 2007 (collectively, the “Manville
P&Ls”).  The Manville P&Ls present fairly in all
material respects the results of operations for the Manville Theater, along with
circuit revenue and expenses allocated to such theater based on attendance, for
the periods referred to therein.  RDI maintains its books and records
in accordance with GAAP applied on a consistent basis, and the Manville P&Ls
were prepared from and are consistent with such books and records, except that
the Manville P&Ls exclude certain financial statements and lack the footnote
disclosures that are required for GAAP.

      

      4.1.5                      Brokerage.  Except
in connection with the “Financing” (as defined in Section 7.4.2), Buyer has
not employed any broker, finder or agent or has incurred or will incur any
obligation or liability to any broker, finder or agent with respect to the
transactions contemplated by this Agreement.  Any such obligation or
liability in connection with the Financing shall be borne solely by Buyer or
RDI.

      

      4.2           Representations and
Warranties of RDI.  RDI hereby represents and warrants to
Seller as follows:

      

      4.2.1                      Organization.  RDI
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Nevada.  RDI has all requisite power to own,
lease and license its properties and assets and to carry on its business in the
manner and in the places where such properties and assets are owned, leased,
licensed or operated or such business is conducted.

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

      4.2.2                      Authority.  RDI
has full right, power and authority to enter into this Agreement and to perform
its obligations hereunder. The entry into and performance of this Agreement has
been duly authorized by all necessary action on the part of RDI in accordance
with its governing documents and applicable law, and this Agreement constitutes,
and each other document, instrument and agreement to be entered into by RDI
pursuant to the terms of this Agreement will constitute, a valid agreement
binding upon and enforceable against RDI in accordance with its terms (except as
limited by bankruptcy or similar laws or the availability of equitable
remedies).

      

      4.2.3                      Consents.  The
execution, delivery and performance by RDI of this Agreement, and all other
agreements, instruments and documents referred to or contemplated herein or
therein do not require the consent, waiver, approval, license or authorization
of any Person or public authority (other than as required under the “HSR Act”
(as defined in Section 5.5)) which has not been obtained and do not and will not
contravene or violate (with or without the giving of notice or the passage of
time or both) the governing documents of RDI or any judgment, injunction, order,
law, rule or regulation applicable to RDI. RDI is not a party to, or subject to
or bound by, any judgment, injunction or decree of any court or governmental
authority or any lease, agreement, instrument or document which may restrict or
interfere with the performance by RDI of this Agreement, or such other leases,
agreements, instruments and documents.

      

      4.2.4                      Brokerage.  Except
in connection with the Financing, RDI has not employed any broker, finder or
agent or has incurred or will incur any obligation or liability to any broker,
finder or agent with respect to the transactions contemplated by this
Agreement.  Any such obligation or liability in connection with the
Financing shall be borne solely by Buyer or RDI.

      

      5.           Conditions Precedent to
Buyer's Obligations.  Buyer's obligations under this Agreement
are subject to the fulfillment of each of the conditions set forth in this
Article 5 at or before the Closing, subject, however, to the right of Buyer to
waive any one or more of such conditions in whole or in part (provided that no
such waiver shall be implied or binding upon Buyer unless given in
writing).

      

      5.1           Performance by
Seller.  Seller shall have timely performed and complied with
in all material respects all agreements and conditions required by this
Agreement to be performed and complied with by Seller on or prior to the Closing
Date, including, without limitation, delivery to Buyer of the “Seller
Deliveries” (as defined in Section 9.3 below) in accordance with Section 9.3
below.

      

      5.2           Accuracy of Representation
and Warranties.  The representations and warranties herein of
Seller shall be true and correct in all material respects as of the Closing Date
(except to the extent any such representation or warranty is qualified by
materiality, in which case such representation or warranty shall be true in all
respects).

      

      5.3           No
Injunctions.  No order shall have been entered in any action or
proceeding before any governmental authority, and no preliminary or
permanent

      
        
           

        

        
          20

          
            

          

        

        
           

        

      

      injunction
by any court of competent jurisdiction shall have been issued and remain in
effect, which would have the effect of making the consummation of the
transactions contemplated by this Agreement illegal; provided, however, that if
any such action, proceeding or injunction exists as a result of the wrongful
action or omission to act of Buyer or any of Buyer’s Affiliates, the same shall
be an event of default by Buyer under this Agreement.

      

      5.4           Required
Consents.  Buyer and Seller shall have received the following
consents to the assignment by Seller to Buyer or the Assignee Subs of Seller’s
interest under the Leases (all such Leases being defined in Exhibit A-1): (a)
from the landlords under all of the following Leases: (i) Town Square 14; (ii)
Carmel Mountain Plaza; (iii) Gaslamp 15; (iv) Valley Plaza 16; (v)
Pearlridge West 16; (vi) Kapolei 16: (vii) Kahala 8; and (viii) Kaahumanu
6; (b) from the master landlord under the Pearlridge West 16 Lease; and, (c) if
and to the extent that the Nondisturbance and Attornment Agreement dated as of
July 1, 1998 by and among Bishop & Bishop Land, LLC, Pacific and First
Republic Bank (“First
Republic”) remains in effect, from First Republic (or First Republic’s
successor-in-interest).  The foregoing consents are hereinafter
referred to as the “Required Leasehold
Assignment Consents, and the Leases affected by any such Required
Leasehold Assignment Consents are hereinafter referred to as the “Required Consent
Leases.”

      

      5.5           HSR
Act.  All required filings under Section 7A of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), shall have
been completed and all applicable time limitations under the HSR Act shall have
expired without a request for further information by the relevant federal
authorities under such Act, or in the event of such a request for further
information, the expiration of all applicable time limitations under the HSR Act
shall have occurred without the objection of such federal
authorities.

      

      5.6           Loan to Reading
International, Inc.  Concurrently with the Closing, and subject
to the satisfaction or waiver of all other conditions precedent set forth in
this Article 5, Seller (or an Affiliate or Affiliates of Seller) (the “Lender”) shall have
made loans to RDI in the aggregate original principal amount of $18,000,000 (the
“Loans”).  The
original principal amount of the Loans shall be subject to increase pursuant to
Section 2.5 above.  The Loans shall be evidenced by Promissory Notes
in substantially the forms of Exhibit C-1 (the
“Five Year
Note”) and Exhibit C-2 (the
“Two Year Note”
and, collectively with the Five Year Note, the “Notes”),
respectively, attached hereto.  The Five Year Note shall bear interest
at the annual rate of 4.0% for the first twenty-six (26) months from the Closing
Date, and at the annual rate of 8.5% thereafter.  Interest on the Five
Year Note shall be payable on the eighteenth-month anniversary of the Closing
Date and quarterly thereafter, in arrears, on the last day of each calendar
quarter, with all outstanding principal and any accrued and unpaid interest due
and payable in a lump sum upon the fifth anniversary of the Closing Date;
provided that such obligations may be prepaid, in whole or in part, at any time
without penalty or premium.  The Two Year Note shall bear interest at
the annual rate of 4.0%, payable quarterly, in arrears, as of the last day of
each calendar quarter, with all outstanding principal and any accrued
and

      
        
           

        

        
          21

          
            

          

        

        
           

        

      

      unpaid
interest due and payable in a lump sum upon the second anniversary of the
Closing Date; provided that such obligations may be prepaid, in whole or in
part, at any time without penalty or premium.   Notwithstanding
the foregoing, to the extent any interest rate payable under either of the Notes
is less than the minimum Applicable Federal Rate, the parties shall reasonably
cooperate in good faith to increase such interest rate to an interest rate at
least equal to the minimum Applicable Federal Rate, provided that the other
terms of the Notes are similarly adjusted to eliminate any adverse economic
impact on RDI from any such increase in the interest rate.

      

      5.7           Financing.  Buyer
shall have received the net proceeds of the Financing described in the
commitment letters referred to in Section 7.4.2 below. Notwithstanding anything
to the contrary contained in this Agreement, the failure to receive any
landlord’s consent to Buyer’s granting of any “Leasehold Mortgage” (as defined
in Section 7.1.3 below) or any other documents contemplated by
subclause (ii) of Section 7.1.3 below, by itself, shall not be a condition
precedent to the performance of Buyer’s obligations under this Agreement other
than the condition precedent set forth in this Section 5.7.

      

      6.           Conditions Precedent to
Seller's Obligations.  Seller's obligations under this
Agreement are subject to the fulfillment of each of the conditions set forth
below in this Article 6 at or before the Closing, subject, however to the right
of Seller to waive any one or more such conditions in whole or in part (provided
that no such waiver shall be implied or binding upon Seller unless given in
writing).

      

      6.1           Performance by
Buyer.  Buyer shall have timely performed and complied with in
all material respects all agreements and conditions required by this Agreement
to be performed and complied with by Buyer on or prior to the Closing Date,
including, without limitation, delivery to Seller of the “Buyer Deliveries” (as
defined in Section 9.2 below) in accordance with Section 9.2 below.

      

      6.2           Accuracy of Representations
and Warranties.  The representations and warranties herein of
Buyer shall be true and correct in all material respects as of the Closing Date
(except to the extent any such representation or warranty is qualified by
materiality, in which case such representation or warranty shall be true in all
respects).

      

      6.3           No
Injunctions.  No order shall have been entered in any action or
proceeding before any governmental authority, and no preliminary or permanent
injunction by any court of competent jurisdiction shall have been issued and
remain in effect, which would have the effect of making the consummation of the
transactions contemplated by this Agreement illegal; provided, however, that if
any such action, proceeding or injunction exists as a result of the wrongful
action or omission to act of Seller or any of Seller’s Affiliates, the same
shall be an event of default by Seller under this Agreement.

      

      6.4           Required
Consents.  Buyer and Seller shall have (a) received all of
the Required Leasehold Assignment Consents, and (b) either (i) Buyer
and Seller shall

      
        
           

        

        
          22

          
            

          

        

        
           

        

      

      have
received consent from the Kukui Landlord to the assignment by Seller to Buyer,
or (ii) the Kukui Landlord shall have exercised the Recapture Rights, or
(iii) Buyer and Seller shall have entered into a management agreement for
the Kukui Lease pursuant to Section 7.1.4.

      

      6.5           HSR
Act.  All required filings under Section 7A of the HSR Act
shall have been completed and all applicable time limitations under the HSR Act
shall have expired without a request for further information by the relevant
federal authorities under such Act, or in the event of such a request for
further information, the expiration of all applicable time limitations under the
HSR Act shall have occurred without the objection of such federal
authorities.

      

      6.6           Loan to Reading
International, Inc.  The Lender shall have received duly
executed originals of the Notes from RDI.

      

      7.           Covenants.

      

      7.1           Commercially Reasonable
Efforts.

      

      7.1.1                      Upon
the terms and subject to the conditions of this Agreement, the parties hereto
will use commercially reasonable efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things necessary, proper or
advisable consistent with applicable law to consummate and make effective in the
most expeditious manner practicable the transactions contemplated by the
Transaction Documents, including, without limitation, obtaining any
authorizations, consents, orders or approvals of any Person or Governmental
Authority that may be or become necessary in connection with the execution,
delivery or performance of a party’s obligations
hereunder.  Notwithstanding the foregoing, neither Seller nor Buyer
shall be required to pay consideration or grant any rights, guarantee or
concession to any third party or to modify in any material manner the terms of
any Lease or Included Contract in order to obtain any such consent or approval
or any such release; provided, however, that if Buyer elects (or is required) to
cause any Assignee Sub to take an assignment of any of Seller’s right, title or
interest under, or assume any of Seller’s obligations under, any of the Leases
being assigned pursuant to this Agreement, and the landlord’s consent is
required under any such Lease, Buyer (in the case of the Buyer Subs) or RDI (in
the case of the RDI subs) shall offer to provide a guarantee to the landlord of
all of such assumed obligations concurrently with Seller’s initial submission to
such landlord of request for such consent.

      

      7.1.2                      Buyer
shall use its commercially reasonable efforts and Seller shall use its
commercially reasonable efforts to cooperate fully to obtain promptly all such
authorizations, consents, orders and approvals required to be obtained in
connection with the transactions contemplated hereby. Without limiting the
generality of the foregoing, to the extent such filing is required by the HSR
Act, Seller and Buyer agree that each shall prepare and file a notification and
report form pursuant to the HSR Act as soon as practicable after the Effective
Date, but in no event later than ten (10) days

      
        
           

        

        
          23

          
            

          

        

        
           

        

      

      after the
Effective Date.  If a filing is made under the HSR Act, Seller and
Buyer each also agree to request early termination in such filing and respond
with reasonable diligence and dispatch to any request for additional information
made in response to such filing.  All filing fees associated with
complying with the HSR Act shall be borne 50% by Seller and 50% by
Buyer.

      

      7.1.3                      Notwithstanding
the provisions of Section 7.1.2, with respect to the assignment of the Leases
being assigned pursuant to this Agreement from Seller to Buyer and with respect
to the assignment of the master lease for the “Rohnert Park 16” (as such term is
defined in Exhibit
A-1 attached hereto) by Kenmore Rohnert, LLC to Buyer, Seller, at
Seller’s cost and expense, shall use its commercially reasonable effort to
cooperate fully with Buyer, and Buyer, at its cost and expense, shall use its
commercially reasonable efforts to cooperate fully with Seller:

      

      (a) to
obtain promptly from the landlords and all other appropriate parties under such
Leases the consents, if any, required to be obtained in connection with (i) such
assignments and (ii) the grant to the lenders under the “Financing” (as defined
in Section 7.4.2) of Liens on the tenant’s interest in such
Leases  and other consents, estoppels and approvals required as
conditions precedent to the closing of the Financing (collectively, the “Leasehold
Mortgages”); provided, however, that Buyer shall bear any expenses
attributable to obtaining the Leasehold Mortgages (as contrasted with the
consents to assignment).  In connection therewith, Buyer agrees
promptly to provide all financial and other information and background materials
regarding Buyer, its Affiliates and their respective senior management, and such
lenders, which the landlord or any such other appropriate party under any such
Lease may reasonably request in connection with such landlord’s evaluation of
Seller’s request for consent to any such assignment or grant of such Leasehold
Mortgage.  Buyer also agrees to make its and its Affiliates’ senior
management reasonably available to all such landlords and other appropriate
parties for this purpose.  Buyer hereby acknowledges that, in those
cases where the landlord’s consent is not required for the assignment of the
applicable Lease to Buyer or to the grant to the lenders under the Financing of
a Leasehold Mortgage with respect to such Lease, Seller may elect to send
notices to various landlords, rather than requests for consents, which notices
describe the transaction contemplated by this Agreement, and some of which
notices seek the “acknowledgment” of a particular landlord to the assignment of
a particular Lease; and

      

      (b)           to
obtain releases of Seller’s and its Affiliates’ liability under the
Leases.

      

      With
respect to the matters described in this Section 7.1.3, Seller may elect at any
time to shift to Buyer primary responsibility for obtaining such consents and
agreements under this Section by so notifying Buyer in
writing.  Thereafter, Buyer shall, at Seller’s expense as provided
above, use its commercially reasonable efforts to accomplish the matters
described in this Section, and Seller shall use its commercially reasonable
efforts to cooperate fully with Buyer.  The parties agree that, if a
landlord or other appropriate party under a Required Consent Lease, or the Kukui
Landlord, who is presented with a

      
        
           

        

        
          24

          
            

          

        

        
           

        

      

      combined
request to consent to the assignment of a Lease hereunder and the grant of a
Leasehold Mortgage with respect to such Lease refuses, without explanation, to
provide the consents requested, or it is not otherwise reasonably apparent from
such party’s response to such combined request whether such party would have
consented to the assignment of the applicable Lease if such request had not been
accompanied by a request for a Leasehold Mortgage, it shall be presumed that
such refusal was attributable only to the request for consent to the Leasehold
Mortgage for purposes of determining whether the condition precedent set forth
in Section 5.4 above has been satisfied; provided, however, that Buyer
shall be entitled to rebut such presumption by requiring Seller to present to
such party a separate request for consent to assignment of such Lease only, and
if such party fails for any reason to provide such consent to assignment it
shall be deemed to constitute a failure of the condition precedent set forth in
Section 5.4 above.

      

      7.1.4                      If,
despite the commercially reasonable efforts of Seller and Buyer, the parties are
unable to obtain the Kukui Landlord’s consent to the assignment of the Kukui
Lease on or prior to the Closing Date, but the Kukui Landlord shall not have
exercised the Recapture Right, Seller and Buyer shall enter into a management
agreement effective as of the Closing Date with respect to the Theaters operated
under the Kukui Lease if and to the extent the same shall be permitted by the
terms of applicable law and the Kukui Lease, or if the Kukui Landlord gives its
consent to such management agreement.  Any such management agreement
shall provide for a fixed annual management fee of $50,000 and otherwise shall
be in a commercially reasonable form agreed upon by Seller and Buyer prior to
the Closing.  To the extent that any Purchased Asset (other than any
Lease being assigned pursuant to this Agreement) is not assigned or not
assignable to Buyer or if any necessary consent to such assignment shall not
have been obtained by Seller as of the Closing, this Agreement shall not
constitute an assignment or attempted assignment of such Purchased
Asset.  With respect to any such Purchased Asset, from and after the
Closing, Seller shall use their commercially reasonable efforts to obtain any
necessary consents; provided, however, that Seller
shall not be obligated to institute any suit, arbitration or other action to
obtain such consent.  If such consents are not obtained, Seller (a)
shall cooperate in any reasonable arrangement designed to provide Buyer with the
benefits of such Purchased Asset and (b) shall enforce at the request of Buyer
at Buyer’s sole cost any rights of Seller arising from such Purchased Asset
(including a right of termination).  Buyer agrees to perform at its
sole cost any obligations relating to a Purchased Asset for which benefits are
being provided to Buyer in accordance with the preceding sentence to the same
extent required of Seller, in the same (or as near as practicable) manner and
time, and with the same quality, required of Seller.

      

      7.1.5                      In
no event shall Buyer or any Affiliate of Buyer be required to increase the
equity capital of Buyer or to contribute any assets to Buyer, or (except as
otherwise provided in Section 7.1.1 above) to provide any guarantee or other
credit enhancement to or for the benefit of Buyer, in order to obtain any
consent contemplated by this Section 7.1.

      
        
           

        

        
          25

          
            

          

        

        
           

        

      

      7.2           Access to Properties and
Records.  From and after the Effective Date through the Closing
Date or the earlier termination of this Agreement, Seller shall afford to Buyer,
and to the accountants, counsel and representatives of the Buyer, upon
reasonable prior notice, reasonable access during normal business hours
throughout the period prior to the Closing to the Leased Premises and, during
such period, shall furnish promptly to Buyer all other information concerning
the Purchased Assets and its personnel as such parties may reasonably
request.  Notwithstanding anything in this Section to the contrary, no
access pursuant to this Section 7.2 shall unreasonably interfere with Seller’s
conduct of the Business.  Buyer shall notify Seller in writing of any
material breach of this provision known to it and shall afford Seller a
reasonable opportunity to cure any such breach.

      

      7.3           Seller’s Operations Prior to
the Closing; Certain Repairs.

      

      7.3.1                      Seller’s Operations Prior to
the Closing.  From and after the Effective Date until the
Closing, Seller (a) shall not sell, transfer, assign, dispose of or grant any
Lien on, or permit to be sold, transferred, assigned, disposed of or encumbered,
all or any material part of the Purchased Assets as the same shall be
constituted on the Effective Date, except to the extent that any such Lien will
be removed at or prior to the Closing, or remove or permit to be removed all or
any part of the Purchased Assets from the Leased Premises; provided, however
that Seller shall be permitted (i) to sell Seller Inventory in the ordinary
course of its business consistent with past practice (provided that Seller
replaces such sold Seller Inventory in the ordinary course of its business
consistent with past practice), (ii) to acquire, maintain and replace Seller
FF&E in the ordinary course of its business consistent with past practice,
and (iii) to enter into and perform film rental agreements in the ordinary
course of its business consistent with past practice (the parties acknowledging
that some of which film rental agreements may not be fully performed prior to
the Closing Date), provided that Seller will reasonably consult with Buyer in
connection with Seller’s proposed entry into film rental agreements relating to
or reasonably anticipated to relate to periods after the Closing Date; (b) shall
not enter into any lease, contract or commitment or incur any liabilities or
obligations in connection with the Purchased Assets, except as permitted by
subclause (iii) above with respect to film rental agreements and except for
leases, contracts, commitments, liabilities or obligations that will not bind
Buyer, the Purchased Assets or the Business after the Closing; (c) shall not
release, waive or compromise any of its rights with respect to, the Purchased
Assets without the prior written consent of Buyer, which consent shall not be
unreasonably withheld, conditioned or delayed to the extent such proposed action
occurs in the ordinary course of its business consistent with past practice and
which is reasonably expected to be without Material Adverse Effect upon the
value or utility of the Purchased Assets or the value of the Business; (d) shall
not, directly or indirectly, destroy or otherwise dispose of any books, records
or files relating to the Purchased Assets or the Business, other that in the
ordinary course of business, generally consistent with past practice; and (e)
shall otherwise conduct operations at the Leased Premises in the ordinary course
of its business consistent with its past practice at the Leased Premises and in
a manner intended to maintain the goodwill of the Business.

      
        
           

        

        
          26

          
            

          

        

        
           

        

      

      7.3.2                      Certain
Repairs.  Seller shall cause to be undertaken and completed in
a workmanlike manner prior to the Closing the repairs to the Milalani 14,
Rohnert Park 16, Ward Cinemas 16 and Pearlridge West 16 Theaters (as each such
Theater is defined in Exhibit A-1)
described in the scope of work attached hereto as Schedule
7.3.2.

      

      7.4           
Cooperation.

      

      7.4.1                      Generally.  Each
party shall provide the other with such cooperation as may reasonably be
requested, at the expense of the requesting party (unless the requesting party
is to be indemnified with respect thereto, in which case such cooperation shall
be given at the expense of the indemnifying party), in connection with the
defense of any third party litigation relating to the subject matter of this
Agreement.  Additionally, until March 31, 2010, Seller shall make
available to Buyer’s independent accountants such information and documentation
regarding the Purchased Assets and the Business to the extent such information
and documentation is reasonably required in connection with an audit by such
independent accountant of Buyer’s financial statements or the preparation of
financial disclosure required under applicable Federal securities laws,
including an audit of acquired businesses as required by 17 CFR § 210.3-05, and
allow Buyer’s independent accountants to make and retain copies of such
information and documentation, provided that (a) such information and
documentation is then in the possession or control of Seller or Seller’s
Affiliates, and (b) so long as Buyer’s independent accountant does not require
that such information or documentation be obtained directly from Seller, such
information and documentation is not otherwise in the possession or control of
Buyer, any of Buyer’s Affiliates or such independent accountant, or is not
otherwise reasonably available from another source to Buyer or such independent
accountant.  Seller also agrees to make its and its Affiliates’ senior
management reasonably available to Buyer and its accountants for this
purpose.

      

      7.4.2                      Cooperation with respect to
Buyer’s Financing.  Buyer hereby represents and warrants to
Seller that (a) it has obtained a written commitment letter and related term
sheet from a financially responsible institution, true and correct copies of
which have been furnished to Seller, for debt financing to be used by Buyer to
fund a portion of the Purchase Price (the “Financing”), and (b)
said commitment letter and related term sheet are in full force and effect, and
Buyer has performed all of its obligations thereunder required to be performed
on or prior to the Effective Date.  Prior to the Closing Date, Seller
agrees promptly to provide all financial and other information and materials
regarding the Leases and other Purchased Assets and the Business as reasonably
requested by Buyer or its accountants from time to time in connection with the
preparation of audited financial statements of the Purchased Assets and the
Business for the twelve (12) months ended June 30, 2005, 2006 and 2007,
respectively, and unaudited financial statements for the most recent practicable
interim period subsequent to June 30, 2007 and prior to the Closing
Date.  Seller also agrees to make its and its Affiliates’ senior
management reasonably available to Buyer and its accountants for this
purpose.  Subject to Seller’s performance of its obligations under
this Section 7.4.2, the completion of said financial statements shall not
be a condition precedent to the

      
        
           

        

        
          27

          
            

          

        

        
           

        

      

      obligations
of Buyer under this Agreement, and Seller shall not be in breach or default of
its obligations under this Section 7.4.2 if such audited financial statements
are not completed for any reason by any particular date so long as Seller has
cooperated with Buyer and its accountants as required by this Section
7.4.2.  Seller agrees that, effective upon the Closing, Buyer’s
accountants shall be released for the benefit of Buyer and RDI from any and all
obligations of confidentiality that it may owe to Seller or its Affiliates only
to the extent they relate to the Purchased Assets and the Business.

      

      7.5           Delivery of Information;
Delivery of Mail and Assets; Collection of Accounts Receivable. After the
Closing Date, each of the parties hereto shall cause their personnel to provide
the other party with financial accounting, Tax, and similar information
reasonably necessary to prepare Tax returns and other filings relating to the
Theaters, to compute Percentage Rent payable with respect to the Theaters, and
to finalize the prorations and adjustments called for by Section 2.2
hereof.  Seller agrees that it will promptly deliver to Buyer any mail
or other communications received by Seller on or after the Closing Date
pertaining to the Purchased Assets and any cash, checks or other instruments of
payment to which Seller is not entitled.  Buyer agrees that it will
promptly deliver to Seller any mail or other communications received by Buyer on
or after the Closing Date pertaining to Seller's operations, properties or other
affairs of Seller, any cash, checks or other instruments of payment to which
Buyer is not entitled, and any other Excluded Assets.

      

      7.6           Post-Closing Covenants of
Buyer.

      

      7.6.1                      Maintenance of
Insurance.  Buyer agrees that from and after the Closing Date,
Buyer shall at all times maintain in complete force and effect, in accordance
with the requirements of the Leases, all policies of insurance required by the
Leases to be maintained by the tenant. Buyer shall deliver to Seller executed
copies of certificates of insurance evidencing the foregoing on the Closing
Date. New certificates shall be delivered promptly whenever policies are renewed
or new policies are written. As often as any such policy shall expire or be
terminated, a renewal or additional policy shall be procured and maintained by
Buyer in like manner and to like extent, and new certificates thereof shall be
delivered to Seller. All policies of insurance maintained by Buyer pursuant to
the requirements of the Leases shall contain a provision that the company
issuing said policy will give Seller not less than ten (10) days' notice in
writing in advance of any cancellation or lapse of the effective date or any
reduction in the amounts of insurance. In the event that Buyer fails to comply
with any of the requirements of this Section 7.6.1, and Buyer fails to cure such
non-compliance within ten (10) days of delivery of notice thereof from Seller,
Seller may obtain any and all policies of insurance required to comply with
tenant's obligations under the Leases, and Buyer shall immediately pay to Seller
any and all costs reasonably incurred by Seller in connection with obtaining and
maintaining such insurance.

      

      7.6.2                      Amendment of Real Property
Leases; Exercise of Options; Waiver of Rights.  Without
Seller’s prior written consent (which consent may not be unreasonably withheld
or delayed), until the earlier of the date on which (a) Seller and
all

      
        
           

        

        
          28

          
            

          

        

        
           

        

      

      of
Seller’s Affiliates are no longer liable on or are released from any further
liability under the applicable Lease, or (b) Buyer delivers to Seller (i) an
audited balance sheet for Buyer showing a net worth (calculated in accordance
with GAAP) of at least $50,000,000, and (ii) an audited income statement for
Buyer showing a ratio of indebtedness to “Theater Level Cash Flow” (as defined
in Article 12 below) for all theaters then operated by Buyer of 5.5-to-1 or
less, Buyer shall not (x) exercise any option to extend or renew the term of any
Lease if, as of the date on which Buyer proposes to exercise any such option,
the Theater operated pursuant to such Lease has Theater Level Cash Flow in the
most recently completed calendar year of less than $200,000, or (y) amend or
modify any Lease to eliminate or materially change, or otherwise waive or
forfeit, any material rights or privileges of the tenant under any such
Lease.

      

      7.7           Coupons and Passes.
Seller, in the ordinary course of its business, has previously issued, and may
continue to issue until the Closing Date, the following coupons, passes, tickets
and certificates (collectively, “Coupons and Passes”):
(a) coupons redeemable in Seller's theaters for food or beverages sold in the
concession stands; (b) passes redeemable for free theater admission and issued
without the payment of consideration to Seller or its Affiliates (“Free Passes”); (c)
passes redeemable for discounted theater admission and issued without the
payment of consideration to Seller or its Affiliates (“Discounted Passes”);
(d) group activity discount theater admission tickets good for theater
admission; and (e) gift certificates which can be used to purchase theater
admission or concession stand items.  Except to the extent any such
Coupons and Passes shall have expired in accordance with their terms or
otherwise are not valid, Buyer shall honor and redeem all Coupons and Passes
presented at the Theaters for a period of one (1) year after the Closing Date
(the “Coupon and Pass
Period”). Buyer shall not be entitled to any compensation or
reimbursement from Seller in connection with the honoring or redemption of any
Free Passes or Discounted Passes.  With respect to all other Coupons
and Passes (“Reimbursable Coupons and
Passes”), Buyer shall deliver a written statement setting forth its
calculation of the amount the Reimbursable Coupons and Passes so redeemed or
honored (which calculation shall be accompanied by such supporting documentation
as Seller may reasonably request) within ninety (90) days after the end of the
Coupon and Pass Period, and Seller shall reimburse to Buyer the amount thereof
within thirty (30) days after Seller’s receipt of such statement and supporting
documentation.  From and after the Effective Date through the Closing
Date, Seller will only issue Coupons and Passes in the markets in which the
Theaters operate in the ordinary course of its business consistent with past
practices; provided, however, that both before and after the Closing Date,
Seller shall have the right to issue Coupons and Passes in all other markets in
which it operates (including, without limitation, Los Angeles County) in
Seller’s sole and absolute discretion and without any obligation to notify or
account therefor to Buyer.

      

      7.8           Theater Names; Prohibition
Against Use of Names "Pacific" or “Pacific Theatres” by
Buyer.

      
        
           

        

        
          29

          
            

          

        

        
           

        

      

      7.8.1                      Pacific and Pacific
Theatres. Except as otherwise provided in this Section 7.8, at no time
after the Closing shall Buyer be entitled to the use of the names "Pacific" or
“Pacific Theatres” either by themselves or in conjunction with other words or
letters, in connection with the name of the Theaters or otherwise. In no event
shall Buyer, either before or after the Closing, be entitled to use the names
"Pacific" or “Pacific Theatres” in any publication, advertisement, flyer,
ticket, notice or sign, or in any other fashion or manner, whether in referring
or relating to the Theaters or otherwise. Notwithstanding the foregoing, Buyer
shall have the right to use the names “Pacific” and “Pacific Theatres” in
connection with any notices or disclosure required by applicable law, and in a
manner reasonably acceptable to Seller on a transitional basis to announce to
the public the change of ownership of the Theaters.  Except to the
extent that Buyer exercises its right under Section 1.3 to continue to use such
signage after the Closing, as soon as practicable after the Closing, and in any
event not later than ten (10) days after the Closing Date, Buyer shall, at
Buyer's expense, remove the names "Pacific" and “Pacific Theatres” from any and
all advertising, fliers, tickets, notices and signs, and from any and all other
manifestations thereof in, on, or in connection with the Buildings, of which
Buyer has knowledge and over which Buyer has possession or control; provided,
however, that if Buyer is unable, or it is commercially impracticable, to remove
the names "Pacific" and “Pacific Theatres” from any signage, including marquees,
within such period, Buyer shall, within such period, cover such names from
public view and shall, as soon as practicable thereafter, remove such names or
the signs on which they are located.

      

      7.8.2                      Signage.  Subject
to the terms of Sections 1.2.4, 1.3 and 7.8.1 above (including, without
limitation, Buyer’s obligation to remove or cover all components thereof
containing the “Pacific” or “Pacific Theaters” names), all signage at the
Theaters shall be included in the Purchased Assets.  Notwithstanding
the foregoing, if Buyer elects to remove any signage from the Theaters
containing the names "Pacific" or “Pacific Theatres” and does not intend to
reuse such signage, Buyer shall notify Seller of the times when it plans to
remove such signage, whereupon Seller shall have the right and option to notify
Buyer that Seller wishes to retain possession and ownership of one or more of
the signs (or portions thereof) which Buyer plans to remove. If Seller exercises
the foregoing right, Buyer shall remove the signs in question in a workmanlike
manner and shall use commercially reasonable efforts not to damage the same,
shall coordinate with Seller the timing of such removal and other aspects
thereof, and shall tender to Seller physical possession of such signs at a
mutually acceptable time and location, provided that if Seller then fails
(through no fault of Buyer) to take possession of such signs within ten (10)
days notice thereof from Buyer to Seller, Buyer shall have the right and option
to destroy and dispose of such signs.

      

      7.8.3                      Assignment.  Buyer
shall not sell, assign, sublet or otherwise transfer any or all of its interest
in the Leases or the Leased Premises to any Person unless Buyer obtains the
written agreement of such Person to be bound by and observe the terms of this
Section 7.8. If at any time after any such transfer, the Leases or the Leased
Premises, or any portion thereof or interest therein, are retransferred back to
Buyer, Buyer shall again be bound by and observe the terms of this Section
7.8.   The

      
        
           

        

        
          30

          
            

          

        

        
           

        

      

      provisions
of this Section 7.8.3 shall not apply in respect of any Lien granted by Buyer in
connection with the contemplated by Section 7.4.2.

      

      7.9           Non-Competition;
Exceptions.

      

      7.9.1                      Non-Compete.  As
a material inducement to Buyer to enter into and perform its obligations under
this Agreement, Seller and the Formans, for themselves and on behalf of their
Affiliates (collectively, the “Selling Parties”),
hereby agree that from and after the Closing Date and continuing for five
(5) years from the Closing Date (the “Restricted Period”),
they shall not, directly or indirectly, as an employee, agent, consultant,
director, equityholder, manager, or in any other individual or representative
capacity, own, operate, manage, control, engage in, invest in, be employed by or
participate in any manner in, render services for, or otherwise assist any
Person that engages in or owns, invests in, operates, manages or controls any
venture or enterprise that directly or indirectly engages in the development,
ownership or operation of movie theaters in the “Territory” (as defined in
Article 12 below) (collectively, “Competitive
Activities”); provided, however, that nothing
contained herein shall be construed to prevent any of the Selling Parties from
engaging in, directly or indirectly, any of the following activities
(collectively, the “Permitted Competitive
Activities”): (a) investing in the securities of any entity engaged
in Competitive Activities whose equity securities are listed on a national
securities exchange or traded in the over-the-counter market so long as such
Selling Party does not own more than five percent (5%) of the outstanding equity
of such entity; (b) investing in the securities of Buyer or any of its
Affiliates; (c) engaging in Competitive Activities within the Territory as
provided in Section 7.10 below; or (d) directly or indirectly engaging in the
ownership, investment, operation, management, development, construction or
control of any retail development or shopping center that contains a movie
theater, provided that such movie theater is not owned, managed or operated by
any of the Selling Parties (a “Non-Affiliated Theater
Owner”), provided, further, that the obligation to pay, or the payment
of, percentage rent to any of the Selling Parties by any such Non-Affiliated
Theater Owner shall not be deemed the ownership or operation of such movie
theater by any such Selling Parties.

      

      7.9.2                      Enforceability;
Blue-Pencil.  Each of the Selling Parties recognizes that the
restrictive covenants contained herein are valid and enforceable pursuant to
applicable law, including, without limitation, California Business and
Professions Code §16601 and that the territorial, time and scope limitations set
forth in this Section 7.9.1 are reasonable and are properly required for the
protection of Buyer’s legitimate interest in client relationships, goodwill and
trade secrets of the Business. In the event that any such territorial, time or
scope limitation is deemed to be unreasonable by a court of competent
jurisdiction, Buyer and Selling Parties agree, and Selling Parties submit, to
the reduction of any or all of said territorial, time or scope limitations to
such an area, period or scope as said court shall deem reasonable under the
circumstances.  If such partial enforcement is not possible, the
provision shall be deemed severed, and the remaining provisions of this
Agreement shall remain in full force and effect.

       

      7.9.3                      Remedies.  Each
of Selling Parties acknowledges and agrees that the covenants set forth in this
Section 7.9 are reasonable and necessary for the

      
        
           

        

        
          31

          
            

          

        

        
           

        

      

      protection
of Buyer’s business interests, that irreparable injury will result to Buyer if a
Selling Party breaches any of the terms of this Section 7.9, and that in the
event of a Selling Party’s actual or threatened breach of any of the provisions
contained in this Section 7.9, Buyer will have no adequate remedy at
law.  Notwithstanding anything to the contrary contained herein, each
of Selling Parties accordingly agrees that in the event of any actual or
threatened breach by it of any of the provisions contained in this Section 7.9,
Buyer shall be entitled to seek such injunctive and other equitable relief as
may be deemed necessary or appropriate by a court of competent
jurisdiction.  Nothing contained herein shall be construed as
prohibiting Buyer from pursuing any other remedies available to it for such
breach or threatened breach, including the recovery of any damages which it is
able to prove.

      

      7.9.4                      Option to
Purchase.  If a Selling Party engages in any Competitive
Activities (other than the Permitted Competitive Activities) during the
Restricted Period, then Buyer shall have the right, exercisable for a period of
ninety (90) days after it is determined that such Selling Party has so engaged
in Competitive Activities (other than Permitted Competitive Activities), to
acquire all, but not less than all, of such Selling Party’s interest in such
Competitive Activity for an amount equal to the lesser of (a) such Selling
Party’s basis in such Competitive Activity for U.S. Federal income tax purposes,
or (b) the “fair market value” of such interest.

      

      7.9.5                      Partial Reimbursement of the
Purchase Price.  If a Selling Party engages in any Competitive
Activities (other than the Permitted Competitive Activities) during the
Restricted Period, and (a) such Selling Party affirmatively challenges
enforceability of the provisions of this Section 7.9 in any proceeding or action
brought by Buyer to enforce the same, or (b) such Selling Party seeks
declaratory or other similar relief from the enforcement of the provisions of
this Section 7.9, then the Purchase Price shall be reduced by the amount of
$7,000,000, and such Selling Party shall reimburse or pay the same to Buyer
within thirty (30) days thereafter.  Notwithstanding the foregoing,
nothing herein shall be deemed to prohibit or restrict any Selling Party from
raising or asserting in any proceeding or action to enforce the provisions of
this Section 7.9 a defense that it has not engaged in the purported Competitive
Activity during the Restricted Period.

      

      7.10           Exception
Area.  Notwithstanding anything to the contrary contained in
Section 7.9 above, any Selling Party shall have the right during the Restricted
Period and thereafter to engage in Competitive Activities with respect to the
ownership or operation of one movie theater complex located within that part of
San Diego County, California shown as the “Exception Area” on the map attached
hereto as Exhibit
E (the “Exception
Area”).  The Exception Area shall include, without limitation,
the shopping center currently commonly known as Westfield UTC.

       

      7.11           Destruction of Books,
Records and Files.  If, after the Closing, Seller or any of its
Affiliates proposes to destroy or otherwise dispose of any books, records or
files relating to the Purchased Assets (but not including any financial reports
or other information regarding the Purchased Assets to the extent such financial
reports or other information is integrated into financial reports or other
information regarding the

       

      
        
           

        

        
          32

          
            

          

        

        
           

        

      

      operations
generally of Seller or such Affiliate), Seller shall deliver prior notice
thereof to Buyer and Buyer shall have a period of sixty (60) days from receipt
of such notice to deliver notice to Seller of its desire to take possession of
such books, records or files, in which event Seller shall deliver to Buyer
possession of such books, records or files at the earliest practicable
date.  Seller shall not destroy or otherwise dispose of such books,
records or files prior to the end of such sixty (60) day period.

       

      7.12           Screen
Advertising.  Buyer hereby agrees to honor the obligations of
Seller imposed under the terms of Seller’s screen advertising agreement with
Screenvision Exhibition, Inc. (“Screenvision”) to
exhibit following the Closing Date all advertising booked or committed to as of
the Closing Date for periods extending beyond the Closing Date, but in no event
existing beyond one (1) year after the Closing Date, provided that such
advertising shall be exhibited by Buyer in accordance with the terms (including
economic terms) of its agreement with Screenvision and not Seller’s agreement
with Screenvision.

      

      7.13           Hawaii Developments during the
Restricted Period.  If, during the Restricted Period, any
Selling Party proposes, directly or indirectly, to engage in (a) the development
of any new retail development or shopping center in the State of Hawaii that is
to contain a movie theater, or (b) the redevelopment of any existing retail
development or shopping center in the State of Hawaii that does not currently
contain a movie theater but is to contain a movie theater after the completion
of such redevelopment, and such Selling Party has the right to select the
theater operator for such newly developed or redeveloped retail development or
shopping center, such Selling Party shall send written notice to Buyer of such
election (the “ROFO
Notice”).  The ROFO Notice shall contain an offer by such
Selling Party to lease such theater (the “Theater Space”) to
Buyer on the terms contained therein (the "Lease
Terms").  The Lease Terms shall be determined by such Selling
Party in its sole discretion.  If Buyer does not, within thirty (30)
days after receipt of the ROFO Notice, deliver written notice to Landlord of
Tenant's election to lease the Theater Space on the Lease Terms, such Selling
Party shall have the right to lease the Theater Space to a Non-Affiliated
Theater Owner on terms which, in the aggregate (taking into account all monetary
terms and concessions on a net present value basis discounted at the rate of 10%
per annum), are not materially less favorable to such Selling Party than the
Lease Terms. If such Selling Party proposes to lease the Theater Space to a
Non-Affiliated Theater Owner on terms which are materially less favorable to
such Selling Party than the Lease Terms, such Selling Party shall provide
written notice to Buyer thereof (which notice shall contain an offer to Buyer to
lease the Theater Space on the revised terms) (the "Revised ROFO
Notice").  If Buyer does not, within fifteen (15) days after
receipt of the Revised ROFO Notice, deliver written notice to such Selling Party
of Buyer's election to lease the Theater Space on the terms contained in the
Revised ROFO Notice, such Selling Party shall have the right to lease the
Theater Space to a Non-Affiliated Theater Owner on the terms contained in the
Revised ROFO Notice. If Buyer timely exercises its right of first offer
contained in this Section 7.13, the parties shall, within thirty (30) days after
Buyer’s exercise of such right of first offer, in good faith negotiate, execute
and deliver a definitive lease for the Theater Space on terms consistent with
the terms agreed upon by such Selling Party and Buyer pursuant to this Section
7.13.   In no event during the Restricted Period shall any
Selling Party commence the

       

      
        
           

        

        
          33

          
            

          

        

        
           

        

      

      development
of a movie theater at the real property located at Kalauao, District of Ewa,
City and County of Honolulu, State of Hawaii and commonly known as the “KAM
Drive-In” site.

       

      7.14           Change of
Name.  On the Closing Date, Consolidated shall execute such
documents as are necessary to change its corporate name so as to delete
therefrom the word “Consolidated,” and will file, as promptly as practicable
after the Closing Date, such documents as are necessary to reflect such name
changes in its state of organization and other jurisdictions where it is
qualified to do business as a foreign Person.  From and after the
Closing Date, the Selling Parties agree that they will not adopt any name that
is confusingly similar to the “Consolidated Amusements” or “Consolidated
Theatres” names.

       

      8.           Employees.  Seller
shall, effective immediately prior to the Closing, terminate the employment of
all of its employees employed at or solely in connection with the Theaters
(collectively, the “Affected Employees”)
or transfer any such employee to other theaters then operated by Seller or any
Affiliate of Seller.  Buyer shall not be obligated to hire or employ
any of the Affected Employees.  Buyer shall provide Seller with (a)
written notice at least thirty (30) days prior to the Closing Date of those
Affected Employees employed as a theater manager or assistant theater manager to
whom Buyer intends to offer employment after the Closing, and (b) written notice
at least ten (10) days prior to the Closing Date of all other Affected Employees
to whom Buyer intends to offer employment after the Closing.  Buyer
acknowledges that it has been advised by Seller that, as part of Seller’s
compliance with the Worker Adjustment and Retraining Notification Act of 1988 or
any similar or comparable state law (collectively, the “WARN Acts”), Seller
shall send all notices required by the WARN Acts to all of the Affected
Employees and be solely responsible for any and all obligations mandated by the
WARN Acts arising from the transactions contemplated by this
Agreement.

      

      9.           Closing.

      

                            9.1           Closing
Date.  Subject to the satisfaction (or waiver by Buyer or
Seller as provided therein) of the conditions precedent in Articles 5 and 6
hereof, the transactions contemplated by this Agreement shall be consummated at
a closing (the “Closing”) at the
offices of Weissmann Wolff Bergman Coleman Grodin & Evall, LLP, 9665
Wilshire Boulevard, Ninth Floor, Beverly Hills, California 90212.  The
Closing shall occur on the date which is the first Friday occurring after the
date which is sixty-five (65) days after the Effective Date (the “Scheduled Closing
Date”).  If the Closing does not occur on the Scheduled Closing
Date by reason of the failure of any condition precedent set forth in Article 5
or 6 hereof (a “Non-Satisfied Condition
Precedent”), the party in whose favor the Non-Satisfied Condition
Precedent exists shall have the right to extend the Scheduled Closing Date until
the date which is the second Friday occurring after the date on which the
Non-Satisfied Condition Precedent is satisfied or
waived.  Notwithstanding the foregoing, this Agreement shall
automatically terminate if the Closing shall not have occurred on or before the
date which is the first Friday which is more than ninety-five (95) days after
the Effective Date (the “Outside Closing
Date”); provided, however, that if on or prior to the Outside Closing
Date all of the parties’

      
        
           

        

        
          34

          
            

          

        

        
           

        

      

      respective
conditions precedent to Closing have been satisfied or waived except for the
condition precedent that the parties shall have received the landlord’s consent
under the “Carmel Mountain Lease” (as defined in Exhibit A-1 attached
hereto) to the assignment of such Lease by Seller to Buyer, then in that case
only the Outside Closing Date shall be extended to the first Friday which is
more than one hundred twenty-five (125) days after the Effective
Date.  Notwithstanding anything to the contrary contained herein,
nothing herein shall be deemed to excuse or waive any breach or default by
either party of its obligations under this Agreement.  The date of the
Closing is sometimes referred to herein as the "Closing
Date."  The Closing shall be effective as of 8:00 a.m. (local
time) on the Closing Date.

      

      9.2           Deliveries by Buyer.
At the Closing, Buyer shall deliver, or cause to be delivered, to Seller the
following (collectively, the "Buyer
Deliveries"):

      

      9.2.1                      Payment of Purchase
Price.  Immediately available funds in an amount equal to the
Purchase Price paid to and received by Seller.

      

      9.2.2                      Assignment and Assumption of
Leases and Subleases.  Duly executed and, where necessary,
acknowledged counterparts of the Assignment and Assumption of Leases and
Subleases by and between Buyer and Seller in substantially the form of Exhibit F attached
hereto (the “Assignment and Assumption of
Leases and Subleases”).

      

      9.2.3                      Assignment and Assumption of
Contracts.  Duly executed counterparts of the Assignment and
Assumption of Contracts by and between Buyer and Seller in substantially the
form of Exhibit
G attached hereto (the “Assignment and Assumption of
Contracts”).

      

      9.2.4                      Assignment of Consolidated
IP.  Duly executed counterparts of the Assignment of Rights by
and between Buyer and Seller with respect to the Consolidated IP in
substantially the form of Exhibit H attached
hereto (the “Consolidated IP
Assignment”)..

      

      9.2.5                      Management
Agreements.   Duly executed counterparts of any Management
Agreements entered into pursuant to Section 7.1.4.

      

      9.2.6                      Intentionally
omitted.

      

      9.2.7                      Intentionally
omitted.

      

      9.2.8                      Buyer’s Closing
Certificate.  A duly executed certificate, dated as of the
Closing Date, to the effect that the conditions specified in Sections 6.1 and
6.2 have been satisfied in accordance with the terms and provisions
hereof.

      
        
           

        

        
          35

          
            

          

        

        
           

        

      

      9.2.9                      Additional
Deliveries.  Such additional documents, instruments and
agreements, signed and properly acknowledged by Buyer, if appropriate, as may be
necessary to comply with Buyer's obligations under this Agreement.

      

      9.3           Deliveries by
Seller.  At the Closing, Seller shall deliver to Buyer all of
the following (collectively, the "Seller
Deliveries"):

      

      9.3.1                      Assignment and Assumption of
Leases and Subleases.  Duly executed and, where necessary,
acknowledged counterparts of the Assignment and Assumption of Leases and
Subleases.

      

      9.3.2                      Assignment and Assumption of
Contracts.  Duly executed counterparts of the Assignment and
Assumption of Contracts.

      

      9.3.3                      Bill of
Sale.  A duly executed Bill of Sale by Seller in favor of Buyer
in substantially the form of Exhibit I attached
hereto.

      

      9.3.4                      Assignment of Consolidated
IP.  Duly executed counterparts of the Consolidated IP
Assignment.

      

      9.3.5                      Management
Agreements.   Duly executed counterparts of any Management
Agreements entered into pursuant to Section 7.1.4.

      

      9.3.6                      Intentionally
omitted.

      

      9.3.7                      Intentionally
omitted.

      

      9.3.8                      Seller’s Closing
Certificate.  A duly executed certificate, dated as of the
Closing Date, to the effect that the conditions specified in Sections 5.1 and
5.2 have been satisfied in accordance with the terms and provisions
hereof.

      

      9.3.9                      Additional
Deliveries.  Such additional documents, instruments and
agreements, signed and properly acknowledged by Seller, if appropriate, as may
be necessary to comply with Seller's obligations under this
Agreement.

      

      9.4           Closing
Costs.  Buyer and Seller shall each pay 50% of all documentary
transfer, excise or similar Taxes (including all State of Hawaii general excise
or gross income Taxes), if any, payable in connection with the transactions
contemplated by this Agreement.  Buyer and Seller shall each bear
their own legal and accounting costs and fees. Buyer and Seller shall each pay
50% of all sales and similar Taxes payable in connection with the transactions
contemplated by this Agreement.

      

      9.5           Possession.  Possession
of the Purchased Assets, including, without limitation, the Leased Premises and
the Theaters shall be delivered to Buyer on the Closing Date; provided, however,
that Seller shall deliver possession of all files for the Leases, Subleases and
Included Contracts and all original warranties and guarantees,

      
        
           

        

        
          36

          
            

          

        

        
           

        

      

      in each
case to the extent included in the Purchased Assets, within five (5) Business
Days after the Closing Date.  Additionally, at or prior to the
Closing, Seller will deliver to Buyer (a) copies of all written film settlement
agreements with respect to the Theaters and covering periods occurring during
the two (2) year period immediately prior to the Closing Date (except that, to
the extent that some or all of such settlement agreements are not available on
the Closing Date, Seller shall deliver the same to Buyer promptly after Seller’s
receipt thereof after the Closing) organized, to the extent that Seller can
accomplish the same without incurring material expenses or expending material
resources, on a film-by-film, week-by-week basis for each Theater, (b) copies of
all written claims for personal injury occurring at the Theaters which have been
received by Seller’s claim administrator since January 1, 2005, (c) copies of
all insurance claims made by Seller with respect to the Theaters since January
1, 2005, and (d) copies of all maintenance claims with respect to the Theaters
received by Joe Miraglia (Director of Staff Operations of Seller) from any
Governmental Authority since January 1, 2005.

      

      10.           Termination; Termination
Fee.

      

      10.1           Termination
Generally.  Notwithstanding anything to the contrary contained
herein, this Agreement may be terminated at any time before the Closing (a) by
mutual consent of Seller and Buyer; (b) by Buyer, upon written notice to Seller,
if Seller has breached any representation, warranty, covenant or agreement, such
breach has had, either individually or in the aggregate, a Material Adverse
Effect, and such breach is either not capable of being cured prior to the
Closing or, if such breach is capable of being cured, is not so cured within ten
(10) days of notice by Buyer to Seller of such breach; (c) by Seller, upon
written notice to Buyer, if Buyer has breached any representation, warranty,
covenant or agreement, and such breach is either not capable of being cured
prior to the Closing or, if such breach is capable of being cured, is not so
cured within ten (10) days of notice by Seller to Buyer of such breach; or (d)
subject to the terms of Section 9.1 above, by either party hereto if the Closing
shall not have occurred on or prior to the Scheduled Closing Date (as the same
may be extended pursuant to this Agreement).  If this Agreement is
terminated, this Agreement shall become null and void and have no further force
or effect, and, except as provided in Section 10.2 below, no party hereto (or
any of such party’s Affiliates, directors, officers, agents or representatives),
shall have any liability or obligation hereunder; provided, however, that (i)
the letter agreement dated as of January 15, 2007 by and among Pacific,
Consolidated and RDI (the “Confidentiality
Agreement”) shall remain in full force and effect, (ii) each party shall
bear its own fees and expenses incurred in connection with the negotiation and
documentation of this Agreement and the Transaction Documents, and (iii)
notwithstanding the foregoing, but subject to the terms of Article 11 below,
termination of this Agreement shall not release any party from any liability for
any breach by such party of any of its representations, warranties, covenants or
agreements contained in this Agreement prior to such termination; and, provided
further, that Buyer shall promptly change its corporate name to a name that does
not include the word “Consolidated” or any derivation of such word or any other
name confusingly similar to the name of Consolidated.

      
        
           

        

        
          37

          
            

          

        

        
           

        

      

      10.2           Termination
Fee.  It is acknowledged and agreed by Seller and Buyer that
Seller has removed the Purchased Assets from the open market during the term of
this Agreement, and thereby has exposed itself to unknown market
risks.  Therefore, if all of the conditions precedent set forth in
Articles 5 and 6 of this Agreement, other than the condition precedent set forth
in Section 5.7, shall have been satisfied or waived and this Agreement is
terminated pursuant to subclause (d) of Section 10.1 by reason of the failure of
the condition precedent in Section 5.7, and Seller shall be released from any
obligation to sell the Purchased Assets to Buyer and Buyer and RDI shall be
released from any obligation to purchase the Purchased Assets.  Seller
and Buyer also acknowledge and agree that (a) it would be extremely difficult or
impracticable to compute Seller’s actual losses as a result of such failure to
consummate the transactions contemplated by this Agreement, and (b) that the
amount of the Deposit is a reasonable estimate of what such losses will
be.  As such, as a material inducement to Seller to enter into and
perform its obligations under this Agreement, the parties agree that if this
Agreement is terminated prior to the Closing pursuant to subclause (d) of
Section 10.1 solely by reason of the failure of the condition precedent set
forth in Section 5.7 above, Seller shall be entitled to retain the Deposit
(without interest thereon) as a termination fee and as Seller’s sole and
exclusive remedy for such termination under this Agreement, at law or in
equity.

      

      BUYER:/s/
SCT                                           SELLER:/s/
AJS                                      

       

      In the
event this Agreement is terminated and Seller shall become entitled to retain
the Deposit pursuant to this Section 10.2, Seller shall pay to Buyer,
within five (5) Business Days of such termination, the Interest Factor on the
Deposit as provided for in Section 2.1.1.  Notwithstanding
anything to the contrary contained in this Agreement, and for the avoidance of
doubt, the parties acknowledge and agree that the condition precedent set forth
in Section 5.6 may only be satisfied concurrently with the Closing and that, if
the condition precedent set forth in Section 5.7 is not satisfied or waived, the
condition precedent set forth in Section 5.6 shall be deemed to be waived by
Buyer.

      

      11.           Indemnification.

      

      11.1           Indemnification by Buyer and
RDI.

      

      11.1.1  Subject
to the terms of this Article 11, Buyer shall indemnify and hold Seller, its
Affiliates (including the other Selling Parties) and their respective employees,
officers, directors, members, managers, shareholders, agents, contractors,
attorneys and representatives (collectively, the “Seller Indemnified
Parties”) harmless from and against, and agrees to promptly defend any
Seller Indemnified Party from and reimburse any Seller Indemnified Party for,
any and all any and all liabilities, demands, claims, actions, causes of action,
costs, damages, deficiencies, Taxes, penalties, fines and other losses and
expenses, whether or not arising out of a claim made by any third party,
including all interest, penalties, reasonable attorneys’ fees and expenses, and
all amounts paid or incurred in connection with any action, demand, proceeding,
investigation or claim by any third party (including any Governmental
Authority)

      
        
           

        

        
          38

          
            

          

        

        
           

        

      

      (“Losses”) which such
Seller Indemnified Party may at any time suffer or incur, or become subject to,
as a result of or in connection with any of the following:

      

      (a)           any
untruth or inaccuracy in any representation or warranty of Buyer or the Buyer
Subs contained in this Agreement or in any other Transaction Document; provided,
however, that for purposes of determining an untruth or inaccuracy in any such
representation or warranty for purposes of this Section 11.1.1(a), the
representations and warranties of Buyer or the Buyer Subs that are limited or
qualified by references to “material” or “materiality” or “Material Adverse
Effect” or similar qualifications shall be construed as if they were not limited
or qualified by such qualifications.

      

      (b)           any
failure of Buyer or the Buyer Subs duly to perform or observe any term,
provision, covenant, agreement or condition contained in this Agreement or the
other Transaction Documents to be performed or observed by Buyer or the Buyer
Subs; or

      

      (c)           any
claim or cause of action by any party arising on or after the Closing Date
against any Seller Indemnified Party (including, without limitation, any claim
or cause of action arising from the failure to obtain any required consents or
approvals, including, without limitation, consents or approvals from landlords,
to the assignment of the Leases being assigned pursuant to this Agreement to
Buyer or the Buyer Subs) with respect to the Purchased Assets, the obligations
of Seller assumed by Buyer or the Buyer Subs under this Agreement (including the
Assumed Liabilities) or any of the other Transaction Documents, or the operation
of the Business or the Theaters by Buyer or any Buyer Sub on or after the
Closing Date, including any default by Buyer or any Buyer Sub under any Lease
included in the Purchased Assets arising on or after the Closing
Date.

      

      11.1.2  Subject to the terms
of this Article 11, RDI shall indemnify and hold the Seller Indemnified Parties
harmless from and against, and agrees to promptly defend any Seller Indemnified
Party from and reimburse any Seller Indemnified Party for, any and all Losses
which such Seller Indemnified Party may at any time suffer or incur, or become
subject to, as a result of or in connection with any of the
following:

      

      (a)  any untruth or
inaccuracy in any representation or warranty of RDI or the RDI Subs contained in
this Agreement or in any other Transaction Document; provided, however, that for
purposes of determining an untruth or inaccuracy in any such representation or
warranty for purposes of this Section 11.1.2(a), the representations and
warranties of RDI or the RDI Subs that are limited or qualified by references to
“material” or “materiality” or “Material Adverse Effect” or similar
qualifications shall be construed as if they were not limited or qualified by
such qualifications; or

      (b)  any failure of RDI or
the RDI Subs duly to perform or observe any term, provision, covenant, agreement
or condition contained in this 

       

      
        
          
             

          

          
            39

            
              

            

          

          
             

          

        

      

      Agreement
or the other Transaction Documents to be performed or observed by RDI or the RDI
Subs; or

      

      (c)  any claim or cause of
action by any party arising on or after the Closing Date against any Seller
Indemnified Party (including, without limitation, any claim or cause of action
arising from the failure to obtain any required consents or approvals,
including, without limitation, consents or approvals from landlords to the
assignment to the RDI Subs of the Leases for the Gaslamp 15 and Carmel Mountain
Plaza (as each is defined on Exhibit A-1)) with
respect to the Leases for the Gaslamp 15 and Carmel Mountain Plaza and any other
Purchased Assets acquired hereunder by the RDI Subs, the obligations of Seller
assumed by the RDI Subs under this Agreement (including the Assumed Liabilities)
or any of the other Transaction Documents, or the operation of the Business or
the Theaters by any RDI Sub on or after the Closing Date, including any default
by any RDI Sub under the Leases for the Gaslamp 15 or Carmel Mountain Plaza
arising on or after the Closing Date.

      

      11.2           Indemnification by
Seller.  Subject to the terms of this Article 11, Seller shall
indemnify and hold the Buyer, its Affiliates and their respective employees,
officers, directors, members, managers, shareholders, agents, contractors,
attorneys and representatives (collectively, the “Buyer Indemnified
Parties”) harmless from and against, and agrees to promptly defend any
Buyer Indemnified Party from and reimburse any Buyer Indemnified Party for, any
and all Losses which such Buyer Indemnified Party may at any time suffer or
incur, or become subject to, as a result of or in connection with any of the
following:

      

      11.2.1                      any
untruth or inaccuracy in any representation or warranty of Seller or Kenmore
Rohnert, LLC, a Delaware limited liability company (“Kenmore”) contained
in this Agreement or in any other Transaction Document; provided, however, that
for purposes of determining an untruth or inaccuracy in any such representation
or warranty for purposes of this Section 11.2.1, the representations and
warranties of Seller or Kenmore that are limited or qualified by references to
“material” or “materiality” or “Material Adverse Effect” or similar
qualifications shall be construed as if they were not limited or qualified by
such qualifications.

      

      11.2.2                      any
failure of Selling Parties or Kenmore duly to perform or observe any term,
provision, covenant, agreement or condition contained in this Agreement or the
other Transaction Documents to be performed or observed by the Selling Parties
or Kenmore;

      

      11.2.3                      except
as otherwise provided by and subject to the terms of Sections 3.3 and 3.4 above,
any claim or cause of action by any party arising on or after the Closing Date
against any Buyer Indemnified Party with respect to the obligations of Seller
retained by Seller or Kenmore under this Agreement or any of the other
Transaction Documents, or the operation of the Business or the Theaters by
Seller or Kenmore prior to the Closing Date, including any default by Seller
under any Lease 

      
        
           

        

        
          40

          
            

          

        

        
           

        

      

      included
in the Purchased Assets arising prior to the Closing Date or any failure of
Seller to satisfy any of its liabilities other than the Assumed
Liabilities;

      

      11.2.4 any claim or cause of action by
any owner or licensor of any point of sale software included in the Purchased
Assets (the “POS
Software”) to the extent such claim or cause of action arises from the
assertion that Seller or its Affiliates does not have the right to assign or
transfer the right to use such POS Software to Buyer;

      

      11.2.5                      any
failure by Seller or its Affiliates to comply with all applicable laws relating
to labor, employment, employment discrimination of all types, employment
practices, pay practices, wages, hours, leave and work breaks, and terms and
conditions of employment, including, without limitation, immigration and
naturalization laws; or

      

      11.2.6                      any
material adverse effect on Buyer’s use of or operations at the Leased Premises
covered by the Lease for Pearlridge West 16, but only to the extent such
material adverse effect (a) arises after the Closing, and (b) is caused solely
by reason of the application of the terms of that certain Master Ground Lease
Administration Agreement dated April, 2004 by and between the Trustees of the
Estate of Bernice Pauahi Bishop and Watercress Associates, LP, LLLP; provided,
however, that the foregoing indemnity shall not cover any Losses incurred by any
Buyer Indemnified Party arising in connection with any of Buyer’s or any Buyer
Indemnified Party’s financing of the transactions contemplated by this Agreement
or otherwise (including, without limitation, any breach or default under the
terms of any such financing caused by any such inconsistency), whether occurring
before or after the Closing.

      

      11.3           Notification and Defense of
Claims.

      

      11.3.1                      A
party entitled to be indemnified pursuant to Section 11.1 or 11.2 (the “Indemnified Party”)
shall promptly notify the party or parties liable for such indemnification (the
“Indemnifying
Party”) in writing of any claim, action, lawsuit, proceeding,
investigation or demand which the Indemnified Party has determined has given or
could give rise to a right of indemnification under this Agreement; provided,
however, that a failure to give prompt notice or to include any specified
information in any notice will not affect the rights or obligations of any party
hereunder except and only to the extent that, as a result of such failure, any
party which was entitled to receive such notice was prejudiced as a result of
such failure.  Subject to the Indemnifying Party’s right to defend in
good faith third party claims as hereinafter provided, the Indemnifying Party
shall satisfy its obligations under this Section 11 within thirty (30) days
after the receipt of written notice thereof from the Indemnified
Party.

      

      11.3.2                      If
the Indemnified Party shall notify the Indemnifying Party of any claim or demand
pursuant to Section 11.3.1, and if such claim or demand relates to a claim or
demand asserted by a third party against the Indemnified Party, the Indemnifying
Party shall have the right to defend any such claim or demand asserted against
the Indemnified Party.  The Indemnified Party shall have the right to
participate 

      
        
           

        

        
          41

          
            

          

        

        
           

        

      

      in the
defense of any such claim or demand at its own expense.  Without
limiting the generality of the foregoing, the Indemnified Party shall not be
entitled to indemnification for any fees or costs of defending any such claim or
demand unless and until the Indemnifying Party elects not to assume the defense
of such claim or demand.  The Indemnifying Party shall notify the
Indemnified Party in writing, as promptly as possible (but in any case five (5)
Business Days before the due date for the answer or response to a claim) after
the date of the notice of claim given by the Indemnified Party to the
Indemnifying Party under Section 11.3.1 of its election to defend any such third
party claim or demand.  So long as the Indemnifying Party is defending
in good faith any such claim or demand asserted by a third party against the
Indemnified Party, the Indemnified Party shall not settle or compromise such
claim or demand without the prior written consent of the Indemnifying Party
(which consent may be granted or withheld in the Indemnifying Party’s sole and
absolute discretion), and the Indemnified Party shall make available to the
Indemnifying Party or its agents all records and other material in the
Indemnified Party’s possession reasonably required by it for its use in
contesting any third party claim or demand.  In the event the
Indemnifying Party elects to defend such claim or action, the Indemnifying Party
shall have the right to settle or compromise such claim or action without the
consent of the Indemnified Party, provided that the terms of the settlement or
compromise impose no additional obligations on the Indemnified Party with
respect to the subject matter of the claim or demand for which the Indemnifying
Party has not agreed to indemnify the Indemnified Party.

      

      11.4           Survival of Representations
and Warranties.  The representations and warranties of the
parties contained in this Agreement and the other Transaction Documents shall
survive the Closing until March 31, 2009, except that the representations and
warranties set forth in Sections 3.1.1, 3.1.2, 3.1.4, 3.1.5 (second, third, and
penultimate sentences only), 3.1.11 and 3.1.15 shall survive
until the applicable statute of limitations has run (the “Survival
Period”).  Notwithstanding any other provision to the contrary,
no party shall be required to indemnify, defend or hold harmless any other party
pursuant to Section 11.1.1(a), 11.1.2(a) or 11.2.1, unless the Indemnified Party
has asserted a claim with respect to such matters within the Survival
Period.

      

      11.5           Characterization of
Payments. Any
payments made pursuant to this Article 11 shall be treated for all Tax purposes
as adjustments to the Purchase Price and no party or any of its Affiliates shall
take any position on a Tax return or in any proceeding with any taxing authority
contrary to such treatment, unless otherwise required by law. 

      

      11.6           Limitations.  Notwithstanding anything
to the contrary contained in this Agreement or in any of the other Transaction
Documents, the parties’ respective indemnification obligations under this
Agreement shall be subject to the limitations contained in this Section
11.6. 

       

      
        11.6.1  Buyer
and RDI shall not be required to indemnify, defend or hold harmless any Seller
Indemnified Party for any inaccuracy in or breach of a 

         

        
          
             

          

          
            42

            
              

            

          

          
             

          

        

         

        representation
or warranty pursuant to Sections 11.1.1(a) and 11.1.2(a), as applicable, and
Seller shall not be required to indemnify, defend or hold harmless any Buyer
Indemnified Party, for any inaccuracy in or breach of a representation or
warranty pursuant to Section 11.2.1, unless the aggregate amount of all such
Losses of the Seller Indemnified Parties or the Buyer Indemnified Parties,
respectively, exceeds an aggregate amount equal to $361,458 (the “Deductible”), after
which event the Seller Indemnified Parties or the Buyer Indemnified Parties, as
applicable, shall be entitled to recover for all Losses in excess of the
Deductible, subject to the other terms of this Agreement; provided, however,
that the limitations set forth in this Section 11.6.1 shall not apply to Losses
resulting from or arising in connection with any breach of the representations
and warranties of Seller under Sections 3.1.15 and 3.1.17 hereof.

        

        11.6.2  Buyer
and RDI shall not be required to indemnify, defend or hold harmless the Seller
Indemnified Parties, and Seller shall not be required to indemnify, defend or
hold harmless the Buyer Indemnified Parties, for Losses in excess of an
aggregate amount equal to 100% of
the Purchase Price; provided, however, that the foregoing limitation shall not
apply to (a) the payment of the Purchase Price by Buyer to Seller, (b) any
indemnification pursuant to any of Sections 11.1.1(c), 11.1.2(c) or 11.2.3, as
applicable, or (c) any indemnification arising out of a breach by Seller of its
representation and warranty in Sections 3.1.4 or 3.1.5 (second, third, and
penultimate sentences only) above.

        

        11.6.3  The
parties agree, for themselves and on behalf of their respective Affiliates,
successors and assigns, that with respect to each indemnification obligation
under this Agreement or any of the other Transaction Documents, the amount of
any Losses shall be reduced by the amount, if any, of any federal, state or
local income Tax benefit realized or any insurance proceeds
received.

        

        11.6.4  The
parties agree that, except as otherwise expressly provided elsewhere in this
Agreement or in any other Transaction Document, the indemnification provisions
of this Article 11 shall be the sole and exclusive remedy for any breach of or
inaccuracy in any representation, warranty, covenant or agreement contained in
this Agreement or in any of the other Transaction Documents; provided, that
either party shall be entitled to seek specific performance of the other party’s
obligation to close the transaction contemplated by this Agreement.

        

        11.6.5  No
Indemnified Party shall seek or be entitled to, or accept payment of, any award
or judgment for consequential, incidental, special, indirect or punitive damages
or lost profits suffered by such Indemnified Party, whether based on statute,
contract, tort or otherwise, and whether or not arising from the Indemnifying
Party’s sole, joint or concurrent negligence, strict liability or other
fault.

        

        11.6.6  Seller
shall have no indemnification obligation hereunder to the extent any Losses
arose out of or resulted from the inaccuracy of any representation or warranty
of Seller, and Buyer or any Affiliate of Buyer had actual

        
          
             

          

          
            43

            
              

            

          

          
             

          

        

      

       

      knowledge
of such inaccuracy prior to the execution and delivery of this Agreement by
Buyer.  For purposes of this Section, the term “actual knowledge”
means the actual knowledge of any one or more of John Hunter, Andrzej
Matyczynski, or S. Craig Tompkins.  Additionally, Buyer shall be
deemed to have “actual knowledge” of any fact which has been disclosed in
writing by Seller, its Affiliates or their respective officers, employees,
agents or representatives to any outside attorney or accountant of
Buyer.

      

      12.           Certain Defined
Terms.  For purposes of this Agreement, the following terms
have the meaning set forth below:

      

      “Affiliate” means, as
to any Person, any other Person which directly or indirectly controls, or is
under common control with, or is controlled by, such Person.  As used
in this definition, “control” (including, with its correlative meanings,
“controlled by” and “under common control with”) shall mean possession, directly
or indirectly, of the power to direct or cause the direction of management or
policies (whether through ownership of securities or partnership or other
ownership interests by contract or otherwise) of such Person; provided, however,
in no event shall either of the Formans be deemed an Affiliate of
Buyer.

      

      “Benefit Plan” means
(i) any “employee benefit plan,” as defined in ERISA Section 3(3), (ii)
any  stock purchase, stock option, severance pay, employment,
change-in-control, vacation pay, company awards, salary continuation, sick
leave, excess benefit, bonus, incentive compensation, or life insurance plan,
and (iii) any other plan, contract, program, policy, or other arrangement
(written or oral), whether or not subject to ERISA, under which any present or
former employee, director, or service provider of Seller and any trade of
business that,  together with Seller, would be regarded as a single
employer under Code Section 414 (an “ERISA Affiliate”) has any present or future
right to benefits or to which Seller or an ERISA Affiliate of Seller has any
obligation to contribute.

      

      “Business Day” means
Monday through Friday, excluding any day of the year on which banks are required
or authorized to close in California.

      

      “COBRA” means the
Consolidated Omnibus Budget Reconciliation Act of 1986.

      

      “Code” means the
Internal Revenue Code of 1986, as amended, and any successor law.

      

      “Environmental Laws”
means all applicable laws, regulations and other requirements of any
Governmental Authority relating to pollution, health or safety or to the
protection of human health, safety or the environment.

      

      “ERISA” means the
Employee Retirement Income Security Act of 1974, as amended.

      

      “GAAP” means United
States generally accepted accounting principles, as in effect from time to
time.

      
        
           

        

        
          44

          
            

          

        

        
           

        

      

      

      “Governmental
Authority” means any U.S., federal, state or local government,
governmental authority, regulatory or administrative agency or commission or any
court, tribunal, or judicial or arbitral body (or any political subdivision
thereof).

      

      “Hazardous Materials”
means any hazardous substance, hazardous waste, contaminant, pollutant or toxic
substance (as such terms are defined in any applicable Environmental Law);
provided that “Hazardous Materials” shall not include customary products used
and/or stored by Seller in the ordinary course of the Business.

      

      “Lien” means any
mortgage, pledge, security interest, encumbrance, lien (statutory or other) or
charge of any kind, including, without limitation, any conditional sale or other
title retention agreement, any lease in the nature of a conditional sale or
title retention agreement, and including any lien or charge outstanding by
statute or other laws which secures the payment of a debt (including, without
limitation, any Tax) or the performance of an obligation.

      

      “Material Adverse
Effect” means a material adverse effect on the value or the Purchased
Assets, taken as a whole, provided, however that any such material adverse
effect arising out of or resulting from an event or series of events or
circumstances affecting (a) the motion picture industry generally or (b) any one
or more markets in which any of the Theaters included in the Purchased Assets
operate, shall not constitute a Material Adverse Effect, including, without
limitation, the opening for business of any theater competitive to the
Theaters.

      

      “Permitted Liens”
means the following Liens: (a) Liens for Taxes, assessments or other
governmental charges or levies not yet due and payable; (b) statutory Liens of
landlords and Liens of carriers, warehousemen, mechanics, materialmen and other
Liens imposed by Law and on a basis consistent with past practice for amounts
not yet due; (c) Liens incurred or deposits made in the ordinary course of the
Business and on a basis consistent with past practice in connection with
worker’s compensation, unemployment insurance or other types of social security
for amounts not yet due; and (d) Liens incurred in the ordinary course of the
Business and on a basis consistent with past practice securing liabilities under
the Assumed Contracts which are not individually or in the aggregate
material.

      

      “Person” means any
individual, corporation, limited liability company, partnership, joint venture,
association, trust, any other unincorporated organization or Governmental
Authority.

      

      “Tax” or “Taxes” means all
federal, state, local or foreign taxes, including, but not limited to, income,
gross income, gross receipts, capital, production, excise, employment, sales,
use, transfer, transfer gain, ad valorem, premium, profits, license, capital
stock, franchise, severance, stamp, withholding, Social Security, employment,
unemployment, disability, worker’s compensation, payroll, utility, windfall
profits, customs duties, personal property, real property, environmental,
registration, alternative or add-on minimum, estimated and other taxes,
governmental fees or like charges of any 

      
        
           

        

        
          45

          
            

          

        

        
           

        

      

      kind
whatsoever, including any interest, penalties or additions thereto whether
disputed or not.

      

      “Territory” means (i)
the State of Hawaii, (ii) San Diego County, California, (iii) all property which
is located within a radius of ten (10) miles from 555 Rohnert Park Expressway,
Rohnert Park, California, and (iv) all property which is located within a radius
of ten (10) miles from 2000 Wible Road, Bakersfield, California.

      

      “Theater Level Cash
Flow” means, with respect to any movie theater (including any Theater)
for any period,  (i) the gross revenues from the operation of such
Theater for such period, less (ii) the film
costs and cost of concessions for such Theater for such period, less (iii) the
operating expenses (including, without limitation, payroll, payroll benefits,
repairs and maintenance, supplies, utilities, advertising, insurance, security
services, taxes and licenses) of such Theater for such period, and less (iv) the
occupancy expenses (including, without limitation, the base or minimum rent,
percentage rent, additional rent and real estate taxes) of such Theater for such
period, in each case calculated in accordance with GAAP, applied on a consistent
basis (with the exception that rents will not be calculated on a straight line
basis as would otherwise be required under FASB 13).  For the
avoidance of doubt, “operating expenses” shall exclude any general or
administrative expenses not incurred at the Theater level, and any depreciation,
amortization, interest or income tax costs.

      

      “Transaction
Documents” means this Agreement and all documents, agreements and
instruments contemplated by and being delivered pursuant to or in connection
with this Agreement.

      

      13.           Notices.  In
the event either party desires or is required to give notice to the other party
in connection with this Agreement, the same shall be in writing and shall be
delivered in person or by recognized overnight air courier service, or deposited
with the United States Postal Service, postage prepaid, or certified mail,
return receipt requested, addressed to Buyer or Seller at the appropriate
address as set forth below:

       

      
        If to
either
Seller:                  Pacific
Theatres Exhibition Corp.

        Consolidated Amusement Theatres,
Inc.

        120 N. Robertson
Boulevard

        Los Angeles, California
90048

        Attention: Chief Operating
Officer

        

        With a
copy
to:                     Weissmann
Wolff Bergman Coleman Grodin & Evall, LLP

        9665 Wilshire Boulevard, Ninth
Floor

        Beverly Hills, California
90212

        Attention:  Mitchell Evall
& Andrew Schmerzler

        

        If to
Buyer or
RDI:               Consolidated
Amusement Theatres, Inc.

        Reading International,
Inc.

        
          
             

          

          
            46

            
              

            

          

          
             

          

        

        c/o Reading International,
Inc.

        500 Citadel Drive, Suite
300

        Commerce, California
90040

        Attention: Chief Operating
Officer

        

        With a
copy
to:                    Troy
& Gould Professional Corporation

        1801 Century Park East, Suite
1600

        Los Angeles, California
90067

        Attention:  Dale E. Short,
Esq.

         

      

      Any such
notice shall be deemed to have been given on the date so delivered, if delivered
personally or by overnight air courier service, or, if mailed, on the date shown
on the return receipt as the date of delivery or the date on which the Post
Office certified that it was unable to deliver, whichever is
applicable.  Any party may, by written notice to the other party,
specify a different address to which notices shall be given, by sending notice
thereof in the manner set forth above.  No copies of notices given to
any party after the date which is one (1) year after the Closing Date also need
be given to outside counsel for such party.

      

      14.           Miscellaneous.

      

      14.1           Entire Agreement;
Amendment.  This Agreement (including all Exhibits and
Schedules hereto), the other Transaction Documents, and the Confidentiality
Agreement contain all of the terms and conditions agreed upon by the parties
hereto with reference to the subject hereof.  No other prior or
concurrent agreements not specifically referred to herein, oral or otherwise,
shall be deemed to exist or to bind any of the parties hereto. No officer or
employee of any party shall have authority to make any representation or promise
not contained in this Agreement and each of the parties hereto agrees that it is
not executing this Agreement in reliance upon any such representation or
promise. This Agreement may not be modified or changed except by written
instruments signed by all of the parties hereto. Subject to the restrictions on
assignment set forth herein this Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and
assigns.

      

      14.2           Assignment.  Except
as permitted by Section 1.5, Buyer may not assign or otherwise transfer all or
any of its rights, obligations or interests under this Agreement without the
prior written consent of Seller.  Except as permitted by Section 1.6,
neither Seller nor the Formans may assign or otherwise transfer all or any of
their respective rights, obligations or interests under this Agreement without
the prior written consent of Buyer.  No assignment of this Agreement
by any party shall be effective until an executed written assumption by such
assignee of the assigning party’s obligations under this Agreement is delivered
to the other party and no such assignment shall relieve any party of its
obligations under this Agreement.

       

      
        14.3           Governing
Law.  This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of California, regardless

      

      
        
           

        

        
          47

          
            

          

        

        
           

        

      

       

      of the
laws that might otherwise govern under applicable principles of conflicts of law
of such state; provided, however, that the provisions of Section 7.9 shall be
governed by and construed and enforced as they pertain to any Theater and the
Business related to such Theater in accordance with the laws of the state in
which such Theater is located..

      

      14.4           Drafting.  This
Agreement has been jointly negotiated and drafted, and shall be construed as a
whole according to its fair meaning and not strictly for or against any
party.

      

      14.5           Further
Assurances.  Each of the parties hereto agrees that it will,
forthwith upon any request by the other party, cooperate fully in the
preparation, execution, acknowledgment, delivery and recording of any
agreements, instruments, memoranda or documents reflecting or in furtherance of
any of the transactions contemplated by this Agreement.

      

      14.6           Intentionally
omitted.

      

      14.7           Confidentiality; Press
Releases.  Except and to the extent required by applicable law
(including, without limitation, Buyer’s obligation to file a report on Form 8-K
with the Securities and Exchange Commission and issue a press release in
connection with the execution and delivery of this Agreement) and the rules and
regulations of the American Stock Exchange, and except as may be necessary to
consummate the transactions contemplated hereby, until the Closing no party
hereto shall disclose the existence of this Agreement, or any of the terms or
provisions hereof, or make any press release or similar disclosure, without the
prior written consent of the other party.  To the extent reasonably
feasible, the initial press release or other announcement or notice regarding
the transactions contemplated by this Agreement shall be made jointly by the
parties; provided, however, that nothing in this Agreement shall prohibit any
party from making press release required by applicable law. Upon the Closing,
the confidentiality and non-disclosure obligations of the parties hereunder and
under the Confidentiality Agreement shall terminate, except to the extent that
such obligations relate to documentation or information relating to any motion
picture theaters other than the Theaters (including Seller’s Los Angeles
theaters), which obligations shall survive until the expiration of the
Confidentiality Agreement in accordance with its
terms.  Notwithstanding the foregoing, following the Closing, without
the prior written consent of Buyer, neither Seller nor any of its Affiliates
shall, directly or indirectly, disclose to any Person any non-public information
regarding the Purchased Assets or the Business, except that Seller and its
Affiliates may disclose such information (a) in connection with matters related
to the sale of the Purchased Assets or the other transactions contemplated by
the Transaction Documents; (b) in connection with the preparation of reports and
documents to be filed by Seller or any of its Affiliates with any Governmental
Authority; (c) to Seller’s officers, directors, employees, agents,
representatives, attorneys and accountants provided that Seller shall be
responsible for any non-permitted disclosure of such information by any such
Persons; (d) if required to do so by a Governmental Authority of competent
jurisdiction, and (e) if such information do so by a Governmental Authority of
competent jurisdiction, and (e) if such information 

      
        
           

        

        
          48

          
            

          

        

        
           

        

      

      is in the
public domain or is previously published or disseminated by a third party other
than pursuant to the provisions of a confidentiality agreement entered with
Buyer.

      

      14.8           Waiver.  No
action taken pursuant to this Agreement shall be deemed to constitute a waiver
by the party taking such action of compliance with any representations,
warranties, covenants or agreements contained in this Agreement. The waiver by
any party of a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach.

      

      14.9           Third
Parties.  Except as otherwise expressly provided for or
contemplated by this Agreement, nothing in this Agreement, express or implied,
shall or is intended to confer upon any Person other than the parties hereto, or
their respective successors or assigns, any rights or remedies of any nature or
kind whatsoever under or by reason of this Agreement.

      

      14.10                      Section
Headings.  Section headings are provided herein for convenience
only and shall not serve as a basis for interpretation or construction of this
Agreement, nor as evidence of the intention of the parties hereto.

      

      14.11                      Severability.  If
any provision of this Agreement as applied to either party or to any
circumstance shall be adjudged by a court to be void or unenforceable, the same
shall in no way affect any other provision of this Agreement, the application of
any such provision in any other circumstances or the validity or enforceability
of this Agreement as a whole.

      

      14.12                      Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute but one and the
same instrument.

      

      14.13                      Reference.  Except
as otherwise expressly provided in this Agreement, any dispute of any nature or
character whatsoever between the parties and arising under or with respect to
this Agreement or any of the other Transaction Documents, or the subject matter
hereof or thereof, shall be resolved by a proceeding in accordance with the
provisions of California Code of Civil Procedure Section 638 et seq., for a
determination to be made which shall be binding upon the parties as if tried
before a court or jury.  The parties agree specifically as to the
following:

      

      14.13.1                      Within
five (5) Business Days after service of a demand by a party hereto, the parties
shall agree upon a single referee who shall then try all issues, whether of fact
or law, and then report a finding or judgment thereon.  If the parties
are unable to agree upon a referee either party may seek to have one appointed,
pursuant to California Code of Civil Procedure Section 640, by the presiding
judge of the Los Angeles County Superior Court;

      

      14.13.2                      The
compensation of the referee shall be such charge as is customarily charged by
the referee for like services.  The cost of such proceedings shall
initially be borne equally by the parties.  However, the prevailing
party 

      
        
           

        

        
          49

          
            

          

        

        
           

        

      

      in such
proceedings shall be entitled, in addition to all other costs, to recover its
contribution for the cost of the reference as an item of damages and/or
recoverable costs;

      

      14.13.3                      If
a reporter is requested by either party, then a reporter shall be present at all
proceedings, and the fees of such reporter shall be borne by the party
requesting such reporter.  Such fees shall be an item of recoverable
costs.  Only a party shall be authorized to request a
reporter;

      

      14.13.4                      The
referee shall apply all California Rules of Procedure and Evidence and shall
apply the substantive law of California in deciding the issues to be
heard.  Notice of any motions before the referee shall be given, and
all matters shall be set at the convenience of the referee;

      

      14.13.5                      The
referee’s decision under California Code of Civil Procedure Section 644, shall
stand as the judgment of the court, subject to appellate review as provided by
the laws of the State of California; and

      

      14.13.6                      The
parties agree that they shall in good faith endeavor to cause any such dispute
to be decided within four (4) months.  The date of hearing for any
proceeding shall be determined by agreement of the parties and the referee, or
if the parties cannot agree, then by the referee. The referee shall have the
power to award damages and all other relief.

      

      14.14                      Interpretative
Matters.  Unless the context otherwise requires, (a) all
references to Articles, Sections or Schedules are to Articles, Sections or
Schedules in this Agreement, (b) each accounting term not otherwise defined
in this Agreement has the meaning assigned to it in accordance with GAAP,
(c) words in the singular or plural include the singular and plural, and
pronouns stated in either the masculine, the feminine or neuter gender shall
include the masculine, feminine and neuter and (d) whenever the words “include,”
“includes” or “including” are used in this Agreement they shall be deemed to be
followed by the words “without limitation.”

      

      14.15                      No Personal
Liability.  Except with respect to the covenants of the Formans
under Section 7.9 above, under no circumstances shall any personal liability or
obligation under this Agreement or under any of the other Transaction Documents
be imposed or assessed against any shareholder, member, manager, officer,
director, employee or agent of any party to this Agreement or of any of such
party’s Affiliates, and no party (nor any party claiming through such party)
shall commence any proceedings or otherwise seek to impose any liability
whatsoever against any such shareholders, member, manager, officer, director,
employee or agents.

      

      14.16                      Guaranty.  Concurrently
herewith, RDI has executed and delivered to Seller a Guaranty in substantially
the form of Exhibit
J attached hereto.

      

      

      [Signatures
contained on next page]

       

      
        
           

        

        
          50

          
            

          

        

        
           

        

      

      

      IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the date first above written.

      

                                                                                                                    
PACIFIC THEATRES EXHIBITION CORP.,

                                                                                                                    
a California corporation

      

      

      By:/s/ James D.
Vandever

      Its:Vice
President

      

      CONSOLIDATED AMUSEMENT
THEATRES, INC., a Hawaii corporation

      

      

      By:/s/ James D.
Vandever

      Its:Vice
President

      

      

                                                                                                                     
CONSOLIDATED AMUSEMENT THEATRES, INC., a Nevada corporation

      

      

      By:/s/ John
Hunter

                                              Its: 
Vice
President                                           

      

      

      AS TO
SECTION 7.9 AND ARTICLES 12 THROUGH 14 ONLY:

      

      

      /s/ Michael R.
Forman                                                      

      MICHAEL
FORMAN

      

      

      /s/ Christopher S.
Forman                                                      

      CHRISTOPHER
FORMAN

       

      
        
           

        

        
          51

          
            

          

        

        
           

        

      

      AS TO
SECTIONS 1.5, 2.4, 4.2, 5.6 AND 14.16 AND ARTICLES 11 THROUGH 14
ONLY:

      

      READING
INTERNATIONAL, INC.

      a Nevada
corporation

      

      By:           /s/ John
Hunter                                           

      

      Its:           Vice
President                                           

      
        
           

        

        
          52

          
            

          

        

        
           

        

      

      
        LIST
OF EXHIBITS

         

        Exhibit
A-1                  The
Leases

        Exhibit
A-2                  The
Subleases

        Exhibit
B                      Included
Contracts

        Exhibit
C-1                   Form
of Five Year Note

        Exhibit
C-2                   Form
of Two Year Note

        Exhibit
D                      Intentionally
omitted

        Exhibit
E                      Exception
Area

        Exhibit
F                      Form
of Assignment and Assumption of Leases and Subleases

        Exhibit
G                      Form
of Assignment and Assumption of Contracts

        Exhibit
H                      Form
of Consolidated IP Assignment

        Exhibit
I                      
Form of Bill of Sale

        Exhibit
J                      
Guaranty of Reading International, Inc.

         

        LIST
OF SCHEDULES

         

        Schedule
1.2.4             FF&E
Inventories

        Schedule
2.7                Allocation
of Purchase Price

        Schedule
3.1.3             Required
Consents

        Schedule
3.1.5             The
Leases and The Subleases

        Schedule
3.1.6             Improvements

        Schedule
3.1.7             Material
Contracts

        Schedule
3.1.8             Compliance
with Laws

        Schedule
3.1.9             Litigation

        Schedule
3.1.10           Employee
Matters

        Schedule
3.1.12           Theater
P&Ls

        Schedule
3.1.13           Affiliate
Transactions

        Schedule
4.1.4             Manville
Lease Summary and Manville P&Ls

        Schedule
7.3.2             Description
and Scope of Repair Work

         

        
          
             

          

          
            53

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}]]