Document:

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                                                                 Exhibit 10.43

                              AMENDED AND RESTATED
                                PLEDGE AGREEMENT

      THE PLEDGE AGREEMENT, dated as of July 28, 2000 (as amended, modified and
supplemented from time to time, this "Agreement"), is entered into by and
between SUTTON HILL ASSOCIATES, a California general partnership (the
"Pledgor"), and CITADEL HOLDING CORPORATION, a Nevada corporation now known as
Reading International, Inc. (together with its permitted successors and assigns,
the "Pledgee") is hereby amended and restated as of January 29, 2002.

                                   WITNESSETH:

      WHEREAS, the Pledgor is (a) the sole member of Sutton Hill Capital,
L.L.C., a limited liability company formed under the laws of the State of New
York ("Sutton Hill Capital"), and (b) the legal and beneficial owner of the
Membership Interest (as hereinafter defined);

      WHEREAS, Sutton Hill Capital and the Pledgee have entered into a certain
Citadel Standby Credit Facility, dated as of July28, 2000 as amended and
restated as of January 29, 2002 (as the same may be amended, restated, modified,
or supplemented from time to time, the "Credit Agreement"), pursuant to which,
at the election of Sutton Hill Capital and upon the satisfaction of certain
conditions precedent provided for therein, the Pledgee has agreed to make to
Sutton Hill Capital certain loans in an aggregate principal amount up to
eighteen million Dollars ($18,000,000) (hereinafter referred to as the "Loans");

      WHEREAS, as an inducement to the Pledgee to make the Loans, if any, to
Sutton Hill Capital pursuant to the terms of the Credit Agreement, the Pledgor
has agreed, in accordance with the terms of Section 4.1(f) of the Credit
Agreement, to execute and deliver this Agreement pursuant to which the Pledgor
will pledge the Collateral (as hereinafter defined) in favor of the Pledgee to
secure the performance and repayment of Sutton Hill Capital's Obligations (as
hereinafter defined), to the extent and in accordance with the terms hereof;

      WHEREAS, Sutton Hill Capital has also acquired certain interests in
various theatre properties in New York City, including the option (the "Sutton
Fee Option") to acquire the fee interests in and to one of such properties (the
"Sutton Fee");

      WHEREAS, Citadel Cinemas, Inc., a Nevada corporation ("Citadel Cinemas"),
has subleased from Sutton Hill Capital certain of the theatre properties,
including the improvements and equipment located therein or thereon
(collectively, the "Leased Interests"), pursuant to provisions of a certain
Lease Agreement, dated as of July 28, 2000, as amended and restated as of
January 29, 2002 (the "Lease Agreement"), between Sutton Hill Capital, as
lessor, and Citadel Cinemas, as lessee;

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      WHEREAS, included in the Lease Agreement is an option in favor of Citadel
Cinemas (the "Lease Option") to acquire from Sutton Hill Capital the Leased
Interests;

      WHEREAS, pursuant to an agreement, dated as of July 28, 2000 as amended
and restated as of January 29, 2002 (the "Fee Option Agreement"), between
Citadel Realty, Inc. ("Fee Sub") and Sutton Hill Capital, Sutton Hill Capital
has granted to Fee Sub the right (the "Fee Option Right"), subject to the
exercise by Citadel Cinemas of the Lease Option and payment by Citadel Cinemas
of the exercise price under the Lease Option, to require Sutton Hill Capital to
exercise the Sutton Fee Option and direct the delivery of the Sutton Fee to or
as directed by Fee Sub, upon payment by Fee Sub or its designee of the exercise
price under the Sutton Fee Option;

      WHEREAS, the Collateral will be subject to the prior pledge thereof to
Nationwide, as described in a certain Intercreditor Agreement among Nationwide,
Sutton Hill Capital and the Pledgee;

      WHEREAS, it is the intention of the Pledgor in executing and delivering
this Agreement to assure to the Pledgee that, if it forecloses on the pledge of
the Membership Interest, the Membership Interest will not be subject to any
claims thereto or rights therein arising from any action of Sutton Hill Capital
or its Affiliates, except for Pledgor Permitted Liens (as hereinafter defined);
and

      WHEREAS, it is the Pledgee's expectation that, if it were to foreclose on
the pledge of the Membership Interest, Sutton Hill Capital's interest in the
Sutton Fee Option and in the Leased Interests would be subject only to Pledgor
Permitted Liens;

      NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

      SECTION 1. Definitions. Unless otherwise defined herein, terms that are
defined in the Credit Agreement and used herein are so used as so defined, and
the following terms shall have the following meanings:

      "Accounts" shall have the meaning assigned to that term in Article 9 of
the Code.

      "Certificate of Title" shall mean a title search or report provided by a
title insurance company or agency licensed to do business in the state where the
Leased Interests are located.

      "Chattel Paper" shall have the meaning assigned to that term in Article 9
of the Code.

      "Citadel Cinemas" shall mean Citadel Cinemas, Inc., a Nevada corporation
and its successors and assigns (including successors or assigns as tenant under
the Lease Agreement).

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      "Code" shall mean the Uniform Commercial Code from time to time in effect
in the State of New York.

      "Collateral" shall have the meaning assigned to that term in Section 2 of
this Agreement.

      "Cure" (including grammatical alternatives thereof) shall mean (i) the
removal of the Lien or Title Impairment in question, either of record or by
arrangement for the title company insuring the interest of the transferee to
"omit" the Lien or Title Impairment in question, or (ii) the causing of the
title company involved to insure against collection or to insure against loss or
forfeiture of title with respect to the Lien or Title Impairment in question,
provided, that, in the case of a Cure described in clause (ii) hereof, the title
company must agree to "omit" such Lien or Title Impairment in question in
connection with any mortgagee title insurance policy with respect to any third
party financing.

      "Designated Payment" shall mean the amounts (if any) required to be paid
to satisfy amounts then payable by the Pledgor to Nationwide pursuant to the
Nationwide Agreement.

      "Event of Default" shall mean the occurrence of any of the following
events: (1) an Event of Default (as defined in the Credit Agreement), or (2) a
default on the part of the Pledgor in the due performance or observance of any
covenant or obligation of the Pledgor contained herein, and, if such default is
capable of cure, the continuance of such default for thirty (30) days after
written notice from the Pledgee to the Pledgor; provided, however, that if such
default is of a nature that it is capable of being cured but not within such
thirty (30) day period and the Pledgor shall have proceeded diligently and in
good faith to complete curing such default, such thirty (30) day period shall be
extended to one hundred eighty (180) days.

      "Fee Option Agreement" shall have the meaning assigned to that term in the
recitals hereto.

      "Fee Option Right" shall have the meaning assigned to that term in the
recitals hereto.

      "General Intangibles" shall have the meaning assigned to that term in
Section 9-106 of the Code and shall include, without limitation, the Membership
Interest and all rights of the Pledgor to receive, directly or indirectly,
moneys or any other rights or benefits therefrom.

      "Insolvency or Liquidation Proceeding" of any person shall mean:

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

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      laws, as now or hereafter constituted, or any other applicable Federal or
      state bankruptcy, insolvency or other similar law; or

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

provided, however, that, if any of the events described in clauses (i) and (ii)
of this definition shall arise as a result of a Tenant Event, then such an event
shall not constitute an Insolvency or Liquidation Proceeding.

      "Instruments" shall have the meaning assigned to that term in Article 9 of
the Code.

      "Intercreditor Agreement" shall mean the Intercreditor Agreement, dated as
of July 28, 2000 as amended and restated as of January 29, 2002, entered into by
and among the Pledgor, the Pledgee, and Nationwide Theatres Corp., a California
corporation and its successors and assigns (hereinafter referred to as
"Nationwide") as amended and restated as of January 29, 2002.

      "Lease Agreement" shall mean the Lease Agreement between Sutton Hill
Capital, as lessor, and Citadel Cinemas, as lessee, dated as of July 28, 2000,
as amended and restated as of January 29, 2002 as amended, modified and
supplemented from time to time.

      "Lease Option" shall have the meaning assigned to that term in the
recitals hereto.

      "Leased Interests" shall have the meaning assigned to that term in the
recitals hereto.

      "Legal Requirements" shall mean all laws, judgments, decrees, ordinances
and regulations and any other governmental rules, orders and determinations and
all requirements having the force of law, now or hereinafter enacted, made or
issued, whether or not presently contemplated (including without limitation the
Americans with Disabilities Act, 42 U.S.C. " 12181 et seq., and local and state
laws of similar impact or effect and rules, regulations and (to the extent
Citadel Cinemas receives notice and a copy thereof pursuant to the Lease
Agreement) orders issued under any thereof) and all existing recorded
agreements, covenants, conditions and restrictions (or any such of which Citadel
Cinemas has notice), applicable to any Leased Interest and/or the construction,
ownership, operation or use thereof, including, without limitation, compliance
with all requirements of labor laws and all federal, state, local and foreign
laws, statutes, codes, ordinances, rules, regulations, directives, binding
policies, permits or orders relating to or addressing the environment or human
health, including, but not limited to, any law, statute, code, ordinance, rule,
regulation, directive, binding

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policy, permit, authorization or order, compliance with which is required at any
time from the date hereof through the Lease Termination Date as such term is
defined in the Lease Agreement (or thereafter as therein set forth), if any,
whether or not such compliance shall require structural, unforeseen or
extraordinary changes to any Leased Interest or the operation, occupancy or use
thereof

      "Lien" shall mean any security interest, mortgage, pledge, hypothecation,
assignment as collateral, encumbrance, lien (statutory or other), or other
security agreement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the Code or
comparable law of any jurisdiction in respect of any of the foregoing).

      "Limited Liability Company Agreement" shall mean the Limited Liability
Company Agreement of Sutton Hill Capital, dated as of April 8, 1999, as the same
may be amended, restated, modified or supplemented from time to time.

      "Membership Interest" shall have the meaning assigned to that term in
Section 2 of this Agreement.

      "Nationwide Accrued Interest" shall mean any interest that has accrued
with respect to the Nationwide Indebtedness so long as such interest has not
arisen as a result of a Tenant Event.

      "Nationwide Pledge Agreement" shall mean the agreement, dated as of July
28, 2000, entered into between the Pledgor and Nationwide as amended and
restated as of January 29, 2002, pursuant to which the Pledgor has granted a
first security interest in the Collateral to Nationwide.

      "Obligations" shall mean any and all indebtedness, debts, obligations, and
liabilities of Sutton Hill Capital to the Pledgee from time to time outstanding
under the Related Documents to which Sutton Hill Capital is a party, whether
fixed or contingent, due or not due, liquidated or unliquidated, determined or
undetermined, and whether for principal, interest, fees, expenses or otherwise,
including principal of and interest on any other amounts payable in respect of
the Loans, if any, and including, further, any rights of subrogation or
contribution arising under the Related Documents.

      "Operational Agreements" shall have the meaning assigned to that term in
the Credit Agreement.

      "Pledgor Permitted Liens" shall mean (a) with respect to the Membership
Interest, the Lien created pursuant to the Nationwide Agreement or any Lien
resulting from or attributable to a Tenant Event and (b) with respect to the
Leased Interests and the Sutton Fee Option, the following Liens and other
matters affecting the title thereto: (i) Liens securing the payment of taxes,
assessments and other governmental charges or levies which are not yet
delinquent to the extent not the obligations of Citadel Cinemas pursuant to the
Lease Agreement; (ii) Legal Requirements, zoning and planning restrictions,
subdivision and platting restrictions, easements, rights-of-way, licenses,
reservations,

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covenants, conditions, waivers, or restrictions on the use of any material
component of real estate comprising the Leased Interests, which exist on the
date hereof and either are set forth in the title insurance policy delivered to
Citadel Cinemas in connection with the Lease Agreement or are not disclosed
therein; (iii) encroachments or irregularities of title none of which materially
impairs the current use or value of the affected Leased Interests; (iv) the
Liens created pursuant to the Nationwide Agreement provided that such Liens are
paid with the applicable Designated Payment; (v) leases and licenses in effect
with respect to any Leased Interest which are permitted by the Lease Agreement;
(vi) mechanics' and materialmen's liens or Liens not disclosed in the title
insurance policy and existing on the date hereof; (vii) exceptions to the title
of any material component of real estate comprising the Leased Interests, of the
Sutton Fee or of the Sutton Fee Option, as the case may be, as set forth in the
title insurance policy delivered to Citadel Cinemas in connection with the Lease
Agreement; (viii) existing Liens listed on Exhibit A attached hereto; (ix) any
Lien which is or results from a Tenant Event or is approved by Citadel Cinemas
for purposes of the Lease Agreement; (x) Liens, including Legal Requirements,
zoning and planning restrictions, subdivision and platting restrictions and any
of the matters affecting title, which result from acts of any agency,
department, court or other administrative, legislative or regulatory authority
of any Federal, state, local or foreign governmental body from and after the
date hereof not caused by or resulting from a Landlord Act (as such term is
defined in the Lease Agreement); and (xi) such other or additional matters as
may be approved in writing by Citadel Cinemas in its sole discretion.

      "Proceeds" shall mean all "proceeds" as such term is defined in Section
9-306(1) of the Code on the date hereof and, in any event, shall include,
without limitation, all dividends or other income from the Membership Interest
and any and all collections on the foregoing or distributions with respect to
the foregoing.

      "Sutton Fee" shall have the meaning assigned to that term in the recitals
hereto.

      "Sutton Fee Option" shall have the meaning assigned to that term in the
recitals hereto.

      "Taxes" shall mean any present or future taxes, levies, imposts, duties,
fees, assessments, deductions, withholdings or other charges of whatever nature,
including income, receipts, excise, property, sales, use, transfer, license,
payroll, withholding, social security and franchise taxes now or hereafter
imposed or levied by the United States, or any state, local or foreign
government or by any department, agency or other political subdivision or taxing
authority thereof or therein and all interest, penalties, additions to tax and
similar liabilities with respect thereto.

      "Title Impairment" shall mean a claim, charge or other matter affecting
title to an Asset or interest therein, other than a Lien, which materially
impairs the intended use or value of the Asset (or interest therein) in question
excluding, however, the matters affecting title as of the date hereof, the Site
Leases and the terms and conditions thereof and matters which constitute Tenant
Events.

      SECTION 2. Grant of Security. As security for the prompt and complete
payment when due of the Obligations, the Pledgor hereby assigns, pledges,
transfers and grants to the Pledgee a

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continuing security interest (which shall be subject and subordinate to the
prior security interest granted to Nationwide pursuant to the Nationwide Pledge
Agreement as and to the extent provided in the Intercreditor Agreement) in, and
a lien upon, all of the Pledgor's right, title and interest in the following
property now owned or at any time hereafter acquired by the Pledgor, or in which
the Pledgor may acquire any right, title or interest, as collateral security for
the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations (collectively, the
"Collateral"):

            a) any and all of its membership interest in Sutton Hill Capital,
      including, without limitation, all its rights, title and interest to
      participate in the operation or management of Sutton Hill Capital and all
      its rights to properties, assets and distributions under the Limited
      Liability Company Agreement, and all certificates evidencing any of such
      membership interests (collectively, the "Membership Interest");

            b) all Accounts arising out of the Limited Liability Company
      Agreement in respect of the Membership Interest;

            c) all General Intangibles arising out of or constituted by the
      Limited Liability Company Agreement in respect of the Membership Interest;
      and

            d) to the extent not otherwise included, all Proceeds of any and all
      of the foregoing.

      This Agreement shall create a continuing security interest in the
Collateral which shall be subject and subordinate to the prior security interest
granted to Nationwide as provided in the Intercreditor Agreement and shall
remain in effect until all the Obligations, now existing or hereafter arising,
shall have been paid in full, the Commitments shall have been terminated and the
Credit Agreement and the Related Documents shall no longer be in effect.

      SECTION 3. Representations and Warranties of Pledgor. The Pledgor hereby
represents and warrants to the Pledgee that: (i) the Pledgor is the sole member
of Sutton Hill Capital and no other Person owns or holds any other ownership
rights in the Membership Interest; (ii) the execution, delivery, and performance
of this Agreement are not in violation of any indenture, agreement, or
undertaking to which the Pledgor is a party or by which the Pledgor is bound;
(iii) the execution, delivery and performance of this Agreement will not result
in the creation or imposition of any lien or charge on, security interest in or
other encumbrance on any of the assets of the Pledgor except as contemplated by
this Agreement; (iv) the Pledgor's chief executive office and the place where
the Pledgor keeps its business records is 120 North Robertson Boulevard, Los
Angeles, California 90048; and (v) this Agreement will create and grant to the
Pledgee (upon the filing of appropriate UCC-1 financing statements) a valid lien
on, and a perfected security interest in favor of the Pledgee in, all right,
title or interest of the Pledgor in or to the Collateral, subject to the prior
lien in favor of Nationwide as provided in the Intercreditor Agreement, Liens
for Taxes and governmental charges and levies which are not delinquent, which
are being Properly Contested by or on behalf of the

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Pledgor or which are the obligation of Citadel Cinemas or any of its Affiliates
to pay pursuant to any of the Operational Agreements and Liens placed on the
Collateral by, or arising from, the actions or inactions of, or any event or
condition relating to, Citadel Cinemas or any of its Affiliates, whether or not
such Liens are permitted to exist pursuant to the terms of any of the
Operational Agreements.

      The Pledgor agrees that the foregoing representations and warranties shall
be deemed to have been made by it on each date of a Notice of Borrowing on or
after the date hereof by Sutton Hill Capital under the Credit Agreement on and
as of such date as though made hereunder on and as of such date.

      SECTION 4. Further Assurances; Affirmative Covenants.

      The Pledgor covenants and agrees that, from and after the date of this
Agreement until the Obligations are paid in full and the Commitment is
terminated:

            a) The Pledgor will promptly execute and deliver and will cause to
      be executed and delivered all further instruments and documents,
      including, without limitation, financing and continuation statements, and
      will take all further action and will cause all further action to be
      taken, that the Pledgee may reasonably request in order to create,
      preserve, perfect and protect the security interest in the Collateral or
      to enable the Pledgee to exercise and enforce its rights and remedies
      hereunder or to preserve, perfect and protect the Pledgee's right, title
      and interest in and to the Collateral.

            b) The Pledgor will at all times keep accurate and complete books
      and records with respect to the Collateral and agrees that the Pledgee or
      its representative shall have the right at any time and from time to time
      to call at the Pledgor's place of business during normal business hours to
      inspect and examine the books and records of the Pledgor relating to the
      Collateral and to make extracts therefrom and copies thereof.

            c) The Pledgor will keep the Collateral free and clear of all
      security interests, liens and claims other than the security interest and
      lien herein granted and the security interest and lien granted to
      Nationwide, Liens for Taxes and governmental charges and levies which are
      not delinquent, which are being Properly Contested by or on behalf of the
      Pledgor or which are the obligation of Citadel Cinemas or any of its
      Affiliates to pay pursuant to any of the Operational Agreements and Liens
      placed on the Collateral by, or arising from, the actions or inactions of,
      or any event or condition relating to, Citadel Cinemas or any of its
      Affiliates, whether or not such Liens are permitted to exist pursuant to
      the terms of any of the Operational Agreements, and will not sell, assign,
      transfer, exchange or otherwise dispose of, or grant any option with
      respect to, the Collateral, except by assignment to the Pledgee and
      Nationwide.

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            d) The Pledgor will defend the Pledgee's right, title and security
      interest in and to the Collateral against claims and demands of all
      persons whomsoever, other than Nationwide.

            e) If the Pledgor shall, as a result of its ownership of the
      Collateral, receive any certificate representing its ownership of the
      Membership Interest and all of the Nationwide Indebtedness now or
      hereafter owing has been paid in full in accordance with the terms of the
      Nationwide Agreement, the Pledgor shall accept the same as the agent of
      the Pledgee, hold the same in trust for the Pledgee and deliver the same
      forthwith to the Pledgee in the exact form received, duly indorsed by the
      Pledgor to the Pledgee, if required.

            f) The Pledgor will at all times remain the sole member of Sutton
      Hill Capital and will allow no other Person to own or hold any other
      ownership rights in the Membership Interest; provided, however, that the
      failure to comply with the terms hereof shall not constitute a breach
      hereunder if the failure to comply arises as a result of any action or
      inaction of, or any condition or event relating to, Citadel Cinemas or any
      of its Affiliates.

      SECTION 5. Lien or Title Impairment.

            a) Subject to the limitations set forth in Section 19 hereof, if, at
      the time of the exercise by the Pledgee of its rights and remedies
      involving the Membership Interest, title thereto or to any of the Leased
      Interests or the Sutton Fee Option shall be subject to a Lien or to a
      Title Impairment other than a Pledgor Permitted Lien, the Pledgor shall be
      obligated to pay, bond, or otherwise Cure such Lien and to Cure such Title
      Impairment.

            b) Not less than ten days prior to the date of the anticipated
      exercise described in the preceding sentence, the Pledgee shall deliver to
      the Pledgor a lien search with respect to the Membership Interest and a
      Certificate of Title with respect to the Leased Interests and the Sutton
      Fee Option, indicating whether or not any Liens encumbering such
      Membership Interest or the interest of Sutton Hill Capital in such other
      assets constitute such Liens other than Pledgor Permitted Liens and
      whether there exists as to Sutton Hill Capital's title to any of such
      assets any such Title Impairment, each as described in the preceding
      paragraph.

            c) If by reason of the occurrence of an Insolvency or Liquidation
      Proceeding of Sutton Hill Capital, Pledgee shall be prevented from
      foreclosing on the Membership Interest or its security interest under the
      Security Agreement (as defined in the Credit Agreement), Pledgor shall
      cause such Insolvency or Liquidation Proceeding to be terminated or
      otherwise to be resolved as promptly as practicable and in a manner such
      that the applicable transaction can be consummated in accordance with its
      terms. All times referred to in Section 5(d) hereof shall be determined
      without regard to any additional time that may be permitted or authorized
      under any statute or order entered in or applicable to such Insolvency or
      Liquidation Proceeding.

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            d) In the event the Pledgor does not timely perform any of the
      obligations set forth in paragraphs (a), (b) or (c) of this Section 5, the
      Pledgee may, after written demand to perform has been served upon the
      Pledgor and the Pledgor has been given 15 days to perform, perform said
      obligations at the Pledgor's sole cost and expense; provided, however,
      that the Pledgee shall not exercise its option to perform said obligations
      for up to 90 days if within said 15-day period the Pledgor has commenced
      to perform the obligation or obligations in question and thereafter to the
      reasonable satisfaction of the Pledgee continues to perform such
      obligation or obligations with reasonable diligence. The Pledgor shall,
      upon written demand from the Pledgee, reimburse the Pledgee for all costs,
      including reasonable attorney's fees and out-of-pocket expenses, and all
      liabilities incurred by the Pledgee by reason of the foregoing set forth
      in this Section 5, with interest thereon at the rate of eleven and one
      quarter percent (11.25%) per annum.

            e) The obligations of the Pledgor under this Section 5 hereof and
      with respect to the Nationwide Accrued Interest shall be unlimited, with
      full recourse to all of the assets of the Pledgor and its partners. The
      Pledgor and its partners agree not to request or permit, in any Insolvency
      or Liquidation Proceeding of the Pledgor, (i) any plan of reorganization,
      or confirmation order with respect thereto, which would include a
      provision that would discharge the partners of Pledgor from their
      obligations to Pledgee under this Section 5 or (ii) any party in interest
      to obtain an injunction that would enjoin or limit the Pledgee's rights
      against the partners of the Pledgee or their assets.

      SECTION 6. Remedies. (a) Subject in all cases to the terms of the
Intercreditor Agreement, upon the occurrence of an Event of Default and an
acceleration of the Loans, the Pledgee may, in its sole discretion, exercise
with respect to the Collateral, in addition to any other rights and remedies
provided for herein or otherwise available to it, all the rights and remedies of
a secured party under the New York Uniform Commercial Code or other applicable
law, and the Pledgee may also, upon reasonable notice as specified below, sell
the Collateral at public or private sale, at any exchange, broker's board or at
any of the Pledgee's offices or elsewhere, for cash, on credit or for future
delivery, and at such price and upon such other terms as the Pledgee may in good
faith deem commercially reasonable. The Pledgee or any of its Affiliates may be
the purchaser of the Collateral at any such sale and shall be entitled, for the
purpose of bidding and making settlement or payment of the purchase price for
the Collateral, to use and apply any of the Obligations as a credit on account
of the purchase price of the Collateral payable by such Person at such sale.
Each purchaser at any such sale shall acquire the property sold absolutely free
from any claim or right on the part of the Pledgor, and the Pledgor hereby
waives (to the fullest extent permitted by law) all rights of redemption, stay
and/or appraisal which it now has or may at any time in the future have under
any rule of law or statute now existing or hereafter enacted. The Pledgor agrees
that at least fifteen (15) days' notice to the Pledgor of the time and place of
any public sale or the time after which any private sale is to be made shall
constitute reasonable notice. The Pledgee will not be obligated to make any sale
regardless of notice of sale having been given. The Pledgee may adjourn any
public or private sale from time to time by announcement of the time and place
fixed therefor, and such sale may, without further notice, be made at the time
and place to which it was adjourned. The Pledgor

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hereby waives any claims against the Pledgee arising by reason of the fact that
the price at which the Collateral may have been sold at such private sale was
less than the price which might have been obtained at a public sale, even if the
Pledgee accepts the first offer received and does not offer the Collateral to
more than one offeree.

      (b) The proceeds of any sale of the Collateral under subsection (a) above
shall be applied in the following manner:

                  i. FIRST, to the payment of all costs and expenses reasonably
            incurred in connection with the sale, collection or other
            realization, including reasonable costs, fees and expenses of the
            Pledgee and its agents and counsel, all other reasonable expenses,
            liabilities and advances made or incurred by the Pledgee in
            connection therewith;

                  ii. SECOND, to the payment, in whole or in part, of the
            Nationwide Indebtedness (as defined in the Intercreditor Agreement);

                  iii. THIRD, to the payment, in whole or in part, of the
            Obligations; and

                  iv. FOURTH, the balance, if any, shall be paid to the Pledgor
            or to whomsoever may be lawfully entitled to receive the same, or as
            a court of competent jurisdiction may direct.

If the Pledgee or any of its Affiliates is the successful bidder at such sale,
the amount owing to Nationwide must be paid in cash.

      (c) The Pledgee has the right to enforce any and all remedies provided in
this Agreement, successively and concurrently, and such action will not operate
to estop or prevent the Pledgee from pursuing any other remedy which the Pledgee
may have at law or in equity or under any other document.

      (d) THE PLEDGOR ACKNOWLEDGES THAT ANY PRIVATE SALE OF THE COLLATERAL MAY
RESULT IN PRICES AND OTHER TERMS LESS FAVORABLE TO THE PLEDGOR THAN IF SUCH SALE
WERE A PUBLIC SALE AND THE PLEDGOR AGREES THAT ANY SUCH PRIVATE SALE SHALL BE
DEEMED TO HAVE BEEN MADE IN A COMMERCIALLY REASONABLE MANNER.

      SECTION 7. Pledgee Appointed Attorney-in-Fact.

      Subject in all cases to the terms of the Intercreditor Agreement, upon the
occurrence and during the continuance of an Event of Default which is not waived
by the Pledgee and following an acceleration of the Loans, the Pledgor hereby
irrevocably makes, constitutes and appoints the Pledgee or any of its officers
or designees its true and lawful attorney-in-fact, with full authority in

                                       11
<PAGE>

the place and stead of the Pledgor and in the name of the Pledgor or otherwise,
from time to time after the occurrence and during the continuation of an Event
of Default which is not waived by the Pledgee and following an acceleration of
the Loans, to take any action, to execute any instruments and to exercise any
rights, privileges, elections or power of the Pledgor pertaining or relating to
the Collateral which the Pledgee may reasonably deem necessary or desirable to
preserve and enforce its security interest in the Collateral and otherwise to
accomplish the purposes of this Agreement.

      SECTION 8. Pledgee May Perform. If the Pledgor fails to perform any
agreement contained herein other than any agreement set forth in Section 5
hereof, the Pledgee may (but shall not be obligated to) itself perform, or cause
performance of, such agreement; provided, however, that the Pledgee shall first
have provided to the Pledgor five (5) Business Days' prior written notice of the
Pledgee's intention so to act (except in cases of emergency when no such notice
shall be required). Any sums expended by the Pledgee pursuant to this Section 7
shall be added to the Obligations and secured by the Collateral.

      SECTION 9. Amendments, etc. No amendment, waiver or modification of any
provision of this Agreement, nor consent to any departure by the Pledgor
therefrom, shall in any event be effective unless the same shall be in writing
making specific reference to this Agreement and such amendment, waiver,
modification or consent shall be consented to in one or more writings and signed
by the Pledgor, the Pledgee and Nationwide, and then such amendment, waiver,
modification or consent shall be effective only in the specific instance for the
specific purpose for which given.

      SECTION 10. Continuing Security Interest. This Agreement shall create a
continuing security interest in the Collateral and shall (a) except with respect
to the provisions in Section 5 hereof, remain in full force and effect until the
later of (i) the termination of the Commitment or (ii) the payment in full of
the Obligations, (b) be binding upon the Pledgor and (c) inure to the benefit of
the Pledgee and its successors and assigns. If the Pledgee shall have instituted
any proceeding to enforce any right, power or remedy under this instrument by
foreclosure, sale, entry or otherwise, and such proceeding shall have been
discontinued or abandoned for any reason or shall have been determined adversely
to the Pledgee, then and in every such case, the Pledgor and the Pledgee shall
be restored to their respective former positions and rights hereunder with
respect to the Collateral, and all right, remedies and powers of the Pledgee
shall continue as if no such proceeding had been instituted.

      SECTION 11. Notices. All notices, offers, acceptances, approvals, waivers,
requests, demands and other communication hereunder or under any other Related
Document shall be in writing, shall be addressed as provided below and shall be
considered as properly given (a) if delivered in person, (b) if sent by express
courier service (including Federal Express, Emery, DHL, Airborne Express, and
other similar express delivery services), (c) in the event overnight delivery
services are not readily available, if mailed by United States Postal Service,
postage prepaid, registered or certified with return receipt requested, or (d)
if sent by telecopy and confirmed; provided, that in the case of a notice by
telecopy, the sender shall in addition confirm such notice by writing sent in
the manner specified in clause (a), (b) or (c) of this Section 10. All notices
shall be effective upon receipt by the addressee; provided, however, that if any
notice is tendered to an addressee and the delivery thereof is refused by such
addressee, such notice shall be

                                       12
<PAGE>

effective upon such tender. For the purposes of notice, the addresses of the
parties shall be as set forth below; provided, however, that any party shall
have the right to change its address for notice hereunder to any other location
by giving written notice to the other party in the manner set forth herein. The
initial addresses of the parties hereto are as follows:

         (a)      If to the Pledgor:
                  Sutton Hill Associates
                  120 North Robertson Blvd.
                  Los Angeles, California 90048
                  Attention: Legal Department
                  Telecopier: (310) 652-6490

with required copies to:

                  Ira Levin
                  Pacific Theatres
                  120 North Robertson Boulevard
                  Los Angeles, CA 90048
                  Telecopier: (310) 652-6490

         (b)      If to the Pledgee:
                  Reading International, Inc.
                  550 South Hope Street
                  Suite 1825
                  Los Angeles, CA 90071
                  Attention: Chief Financial Officer
                  Telecopier No.: (213) 235-2229

with required copies to:

                           S. Craig Tompkins
                           Reading International, Inc.
                           550 South Hope Street
                           Suite 1825
                           Los Angeles, CA 90071
                           Telecopier No. (213) 235-2229

Each such notice, request or other communication shall be effective when
actually received.

                                       13<PAGE>
                                                                 Exhibit 10.44

                  AMENDED AND RESTATED INTERCREDITOR AGREEMENT

      THE INTERCREDITOR AGREEMENT, dated as of July 28, 2000 (the "Original
Agreement") as amended, supplemented or modified from time to time, this
"Agreement"), entered into by and among: Citadel Holding Corporation, a Nevada
corporation now known as Reading International, Inc. (together with its
permitted successors and assigns, "Citadel"); Sutton Hill Capital, L.L.C., a New
York limited liability company (together with its permitted successors and
assigns, "SHC"); and Nationwide Theatres Corp., a California corporation
(together with its permitted successors and assigns, "Nationwide") is hereby
amended and restated as of January 29, 2002.

                                 R E C I T A L S

      WHEREAS, Nationwide is the holder of certain obligations of Sutton Hill
Associates, a California general partnership ("Sutton Hill"), which relate to
various assets of Sutton Hill or its Affiliates (the "Affected Assets") (such
agreements, documents and instruments between Nationwide and Sutton Hill
evidencing such obligations and representing a principal indebtedness of
$11,000,000, collectively referred to as the "Existing Nationwide Agreement,"
the balance of such obligations of Sutton Hill to Nationwide being unaffected by
this Agreement and not included in the "Existing Nationwide Agreement");

      WHEREAS, pursuant to the Existing Nationwide Agreement, there are
outstanding loans in the aggregate principal amount of eleven million Dollars
($11,000,000);

      WHEREAS, the Affected Assets are being transferred from Sutton Hill or its
Affiliates to SHC, which is wholly owned by Sutton Hill, and, in connection with
such transfer, Sutton Hill desires to amend and modify the Existing Nationwide
Agreement;

      WHEREAS, SHC and Citadel have entered into an agreement dated as of July
28, 2000 as amended and restated of January 29, 2002 (as amended, restated,
modified or supplemented from time to time, the "Citadel Agreement"), pursuant
to which Citadel will make available to SHC a standby credit facility in an
aggregate principal amount up to eighteen million Dollars ($18,000,000);

      WHEREAS, as a condition precedent of borrowing under the Citadel
Agreement, SHC and Citadel must enter into the Subordinated Documents (as
hereinafter defined);

      WHEREAS, Nationwide required that, in order to satisfy a condition to the
amendment and modification of the Existing Nationwide Agreement (the Existing
Nationwide Agreement, as so amended and modified, the "Nationwide Agreement"),
that the Original Agreement and this Agreement be entered into among the parties
hereto; and

<PAGE>

      WHEREAS, the purpose of this Agreement is to confirm, as between
Nationwide and Citadel, their respective rights and priorities with respect to
the obligations of SHC and with respect to the Equity Collateral and the
Borrower Collateral (as such terms are defined in the Citadel Agreement) now or
hereafter held as security by Nationwide in respect of the Nationwide
Indebtedness and by Citadel in respect of the Citadel Indebtedness.

      NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:

                                    ARTICLE I

                                   DEFINITIONS

      Section 1.01 Certain Defined Terms. Unless otherwise defined herein, terms
that are defined in the Citadel Agreement and used herein are so used as so
defined, and the following terms shall have the following meanings:

            "Affiliate" of any Person means any other Person controlling,
      controlled by or under direct or indirect common control with such Person.
      For the purposes of this definition, "control," when used with respect to
      any specified Person, means the power to direct the management and
      policies of such Person, directly or indirectly, whether through the
      ownership of voting securities, by contract or otherwise; and the terms
      "controlling" and "controlled by" have the meanings correlative to the
      foregoing. Notwithstanding the foregoing: (a) SHC and its Affiliates
      ("SHC's Affiliates") shall not include Reading, Citadel and their
      respective direct or indirect Subsidiaries; (b) Reading, Citadel and their
      respective direct or indirect Subsidiaries, on the one hand, and SHC and
      SHC's Affiliates, on the other hand, shall not be considered Affiliates of
      each other; (c) SHC and SHC's Affiliates shall not include Nationwide and
      its direct or indirect Subsidiaries; (d) none of Nationwide or any of its
      direct or indirect Subsidiaries, on the one hand, and SHC or any of SHC's
      Affiliates, on the other hand, shall be considered Affiliates of each
      other; (e) Citadel and its Affiliates ("Citadel's Affiliates") shall not
      include Nationwide and its direct or indirect Subsidiaries; (f) Reading
      and its Affiliates ("Reading's Affiliates") shall not include Nationwide
      and its direct or indirect Subsidiaries; and (f) none of Nationwide or any
      of its direct or indirect Subsidiaries, on the one hand, and either
      Citadel or any of Citadel's Affiliates or Reading and any of Reading's
      Affiliates, on the other hand, shall be considered Affiliates of each
      other.

            "Agreement" has the meaning specified in the preamble to this
      Agreement.

            "Bad Faith Determination" with respect to a Citadel Proceeding means
      the entry of one or more Final Orders (i)(a) dismissing such Citadel
      Proceeding if (I) neither Nationwide

<PAGE>

      nor SHC consented to such Citadel Proceeding and at least one of
      Nationwide or SHC opposed such Citadel Proceeding and (II) such Final
      Order is based on a finding by the court that (A) in the case of a Citadel
      Proceeding under the Federal bankruptcy laws, the criteria in 11 U.S.C.
      '303(b) are not satisfied or (B) in any other case, the relevant statutory
      criteria for bringing such Citadel Proceeding are not satisfied and (b)
      finding that any Petitioning Creditor in such Citadel Proceeding which is
      Citadel or a Citadel Affiliate, at the time such petition or other action
      was filed or taken, initiated such Citadel Proceeding in "bad faith" (or
      words of similar import) or (ii) granting judgment against a Petitioning
      Creditor therein which is Citadel or an Affiliate of Citadel under 11
      U.S.C. '303(i)(2) (as any such statutory section referenced herein may
      hereafter be modified, restated or amended).

            "Blockage Period" has the meaning specified in Section 2.02(b).

            "Change" has the meaning specified in paragraph (b) of Section 2.10.

            "Citadel" has the meaning specified in the preamble to this
      Agreement.

            "Citadel Agreement Payment Default" means an Event of Default under
      Section 9.1(a) of the Citadel Agreement.

            "Citadel Event of Default" means an Event of Default as such term is
      defined in the Citadel Agreement.

            "Citadel Indebtedness" means any and all amounts of money from time
      to time owing by, and any and all obligations and liabilities from time to
      time of, SHC under the Subordinated Documents, whether now existing or
      hereafter arising (as limited by the terms of this Agreement), fixed or
      contingent, due or not due, liquidated or unliquidated, determined or
      undetermined, and whether for fees, indemnities, costs, expenses or
      otherwise, including without limitation any rights of indemnification,
      reimbursement, subrogation or contribution arising under the Subordinated
      Documents.

            "Citadel Proceeding" means an Insolvency or Liquidation Proceeding
      in which Citadel or any Citadel Affiliate is a Petitioning Creditor;
      provided, however, that, if the Citadel Indebtedness is transferred, the
      term Citadel Proceeding shall mean an Insolvency or Liquidation Proceeding
      in which the holder of the Citadel Indebtedness or an Affiliate of such
      holder is a Petitioning Creditor.

            "Credit Agreement" shall mean each credit agreement, loan agreement,
      note purchase agreement and each other agreement or arrangement between
      SHC and a lender or lenders to SHC or other Person or Persons providing
      credit support to SHC or to debt issued by or on behalf of SHC, as the
      same may be amended, restated, modified or supplemented from time

                                       3
<PAGE>

      to time, including without limitation the Nationwide Agreement and
      collectively, the Citadel Agreement and the Subordinated Documents.

            "Creditor" shall mean each of Nationwide and Citadel, in their
      respective roles as lender to SHC.

            "Final Order" means a judgment by a court of competent jurisdiction,
      not subject to further appeal or with respect to which the time to appeal
      has lapsed.

            "Fully Paid" means, with respect to the Nationwide Indebtedness, for
      purposes only of this Agreement, as of any date, that on or before such
      date (i) the principal of such Nationwide Indebtedness shall have been
      paid in full in immediately available funds or such other manner
      satisfactory to Nationwide, (ii) all interest accrued on such Nationwide
      Indebtedness as of such date (including interest accrued after, or that
      would have accrued but for, the filing of a petition under Title 11 of the
      United States Code (or any successor statute thereto) or the institution
      or initiation of any other Insolvency or Liquidation Proceeding, in
      accordance with the terms of such Nationwide Indebtedness) shall have been
      paid in full in immediately available funds or such other manner
      satisfactory to Nationwide, and (iii) all fees and expenses and other
      amounts then due and payable that constitute Nationwide Indebtedness shall
      have been paid in full in immediately available funds or such other manner
      satisfactory to Nationwide; provided, however, that if, at any time after
      the Nationwide Indebtedness is determined to be "Fully Paid" for purposes
      of this Agreement, any other amounts that constitute Nationwide
      Indebtedness become due and payable, such other Nationwide Indebtedness
      shall be "Fully Paid" for such purpose only upon satisfaction of the
      conditions specified in foregoing clause (i), (ii) or (iii), as the case
      may be, and the provisions of this Agreement shall remain, or shall be
      revived and thereafter remain, in full force and effect, with respect only
      to the principal amount of the Citadel Indebtedness then outstanding and
      accrued interest thereon, and any other amounts payable with respect
      thereto, then unpaid, until such other Nationwide Indebtedness shall be
      Fully Paid pursuant hereto.

            "Insolvency or Liquidation Proceeding" means (i) any insolvency or
      bankruptcy case or proceeding (including any case under the Bankruptcy
      Code), or any receivership, liquidation, reorganization or other similar
      case or proceeding relative to SHC or all or substantially all of its
      assets, or (ii) any liquidation, dissolution, reorganization or winding up
      of SHC, whether voluntary or involuntary and whether or not involving
      insolvency or bankruptcy, or (iii) any assignment of all or substantially
      all of the assets of SHC for the benefit of creditors or any other
      marshaling of assets and liabilities of SHC.

            "Nationwide" has the meaning specified in the preamble to this
      Agreement.

                                       4
<PAGE>

            "Nationwide Accrual" means interest on the principal of the
      Nationwide Indebtedness (i) relating to any period in respect of which
      either (x) Citadel Cinemas has failed to pay any amount of Basic Rent or
      Additional Rent (each as defined in the Lease Agreement) or (y) as a
      result of the failure by Citadel Cinemas to perform any of its obligations
      under any of the Operational Documents, SHC has applied Basic Rent
      received by it to perform such obligations, in each case under clause (x)
      or (y) limited to the lesser of (a) the amount which Citadel Cinemas
      failed to so pay or the amount which SHC has so applied, as the case may
      be, and (b) the amount of such interest, or (ii) which remains unpaid and
      accruing on such principal (or, but for the filing of a Citadel
      Proceeding, that would have accrued on such principal) during the pendency
      of a Citadel Proceeding if there is a Bad Faith Determination with respect
      to such Citadel Proceeding.

            "Nationwide Agreement" has the meaning specified in the recitals to
      this Agreement, as any document, instrument or agreement comprising the
      Nationwide Agreement may from time to time be amended, modified or
      supplemented, and any agreement or other document or instrument pursuant
      to which any principal of or interest on or other amounts payable in
      respect of indebtedness thereunder of SHC (or any successor Person to SHC
      (whether by merger, consolidation, or acquisition of all or substantially
      all of its assets)) may be renewed, extended, refinanced, restructured,
      refunded or guaranteed, in each case as permitted in accordance with
      Section 2.10(c) of this Agreement.

            "Nationwide Event of Default" means an Event of Default as such term
      may be defined in the Nationwide Agreement.

            "Nationwide Indebtedness" means any and all indebtedness,
      obligations and liabilities of SHC from time to time outstanding under the
      Nationwide Agreement, in a principal amount not to exceed the amount
      permitted pursuant to the last sentence of Section 7.3 of the Citadel
      Agreement, whether now existing or hereafter arising, fixed or contingent,
      due or not due, liquidated or unliquidated, determined or undetermined,
      and whether for principal (subject to the aforesaid limitation), premium,
      interest (including interest accruing before or after the commencement of
      any Insolvency or Liquidation Proceeding or interest that would have
      accrued but for the commencement of such Insolvency or Liquidation
      Proceeding, to the date of payment, even if the claim for such interest is
      not allowed pursuant to Applicable Law), fees, indemnities, costs,
      expenses or otherwise.

            "Petitioning Creditor" with respect to any Insolvency or Liquidation
      Proceeding means each of the creditors that filed the petition to commence
      or otherwise commenced such Insolvency or Liquidation Proceeding.

            "Reading" means Reading Entertainment, Inc., a Nevada corporation,
      and its successors.

                                       5
<PAGE>

            "Retained Claims" has the meaning specified in Section 2.11(h)
      hereof.

            "SHC" has the meaning specified in the preamble to this Agreement.

            "Subordinated Documents" means the Citadel Agreement and the Note
      (if and when executed) and all other promissory notes and other
      instruments, agreements and documents executed at any time pursuant to the
      Citadel Agreement or in connection therewith between SHC and Citadel,
      including all other Related Documents, and all amendments, modifications,
      supplements, extensions, renewals, restatements, refundings and
      refinancings affecting the Citadel Agreement and all such other notes,
      instruments, agreements and documents.

            "Trigger Event" means the occurrence of any of the following events:

            (a) An Insolvency or Liquidation Proceeding excluding such
      Insolvency or Liquidation Proceeding caused by or in any way resulting
      from a Tenant Event;

            (b) Acceleration of the Nationwide Indebtedness;

            (c) Acceleration of the Citadel Indebtedness as a result of a
      Citadel Agreement Payment Default or a failure to make payment when due
      under the Nationwide Agreement following the expiration of applicable
      notice or grace period thereunder; or

            (d) The occurrence of an Event of Default under the Citadel
      Agreement pursuant to Section 9.1(c) thereof arising as a result of a
      default by SHC under any of Section 6.8, 6.9, 7.1, 7.2, 7.3, 7.4, 7.5,
      7.7, 7.9, 7.11, 7.12 or 7.13 thereof.

      Section 1.02 Construction. References herein to the plural form include
the singular, and the singular include the plural; the word "including" is not
limiting; and the word "or" is not exclusive. The words "hereof", "wherein",
"hereby", and "hereunder" refer to this Agreement as a whole and not to any
particular provision of this Agreement. Article, section, exhibit and schedule
references are to articles and sections of, and exhibits and schedules to, this
Agreement, unless otherwise expressly indicated.

                                   ARTICLE II
                             TERMS OF SUBORDINATION

      Section 2.0 Subordination of Indebtedness. Citadel, for itself and its
successors and assigns, hereby agrees that (a) to the extent and in the manner
provided in this Agreement, and under

                                       6
<PAGE>

the circumstances provided in Sections 2.02 and 2.04 hereof, the Citadel
Indebtedness is hereby expressly made subordinate and subject in right of
payment to the prior payment in full of all Nationwide Indebtedness, (b) the
subordination provided herein is for the benefit of Nationwide and its permitted
successors and assigns, (c) Nationwide shall be deemed to have extended or
acquired the Nationwide Indebtedness, whether now outstanding or hereafter
created, incurred, assumed or guarantied, in reliance upon the covenants and
provisions contained in this Agreement, and (d) the provisions of this Agreement
apply notwithstanding anything to the contrary in the Subordinated Documents.
Notwithstanding anything contained herein or in any other document related
hereto to the contrary, however, in no event shall the Citadel Indebtedness be
subordinate to a principal amount of Nationwide Indebtedness which exceeds the
amount permitted pursuant to the last sentence of Section 7.3 of the Citadel
Agreement.

      Section 2.0 No Payment on Citadel Indebtedness in Certain Circumstances.

            (a) Upon the maturity of any Nationwide Indebtedness, whether at the
      final maturity thereof, by lapse of time, acceleration or otherwise
      (including the scheduled time of payment (including any mandatory
      prepayment) of any principal or interest), all principal thereof that is
      then due and payable (up to the amount permitted pursuant to the last
      sentence of Section 7.3 of the Citadel Agreement) and interest thereon and
      interest thereafter accruing pursuant to the terms of the Nationwide
      Agreement (including interest that would have accrued but for the
      commencement of any Insolvency or Liquidation Proceeding) and other
      amounts constituting Nationwide Indebtedness that are then due and payable
      or thereafter accruing in accordance with the Nationwide Agreement and, to
      the extent so provided for therein or otherwise permitted by law, interest
      on such other amounts shall first be Fully Paid, before any payment or
      distribution is made by SHC on account of the Citadel Indebtedness.

            (b) Upon the occurrence and during the continuation of a Nationwide
      Event of Default, no direct or indirect payment or distribution shall be
      made by SHC on account of any Citadel Indebtedness, for a period (the
      "Blockage Period") beginning on the date of the occurrence of the
      Nationwide Event of Default in question and ending upon the earliest to
      occur of the following: (i) when such Nationwide Event of Default shall
      have been cured by SHC or waived in writing by Nationwide, (ii) when
      Nationwide shall have waived in writing the application of this Section
      2.02(b) to such Nationwide Event of Default, or (iii) when the Nationwide
      Indebtedness is Fully Paid.

            (c) Except as expressly prohibited in paragraphs (a) and (b) of this
      Section 2.02, nothing contained herein or in any other document or
      agreement shall prohibit or restrict SHC from paying the Citadel
      Indebtedness as and when due.

                                       7
<PAGE>

            (d) If Citadel shall have received any payment or distribution in
      contravention of the provisions of paragraph (a) or (b) of this Section
      2.02, such payment or distribution shall be held in trust for Nationwide
      and shall be promptly paid over to Nationwide for application to the
      payment of the Nationwide Indebtedness, until any of the events described
      in Sections 2.02(b)(i), 2.02(b)(ii) and 2.02(b)(iii) shall have occurred.

            (e) Each of the Creditors shall give prompt notice to the other
      Creditor of the occurrence and the type of any Nationwide Event of Default
      or Citadel Event of Default, as the case may be, or if a payment or
      distribution would constitute or result in a Nationwide Event of Default
      or Citadel Event of Default, as the case may be. Nationwide shall confirm
      in writing, in response to a written request from Citadel or any of its
      Affiliates, whether or not Nationwide shall have received payment from SHC
      of any obligation of SHC to Nationwide specified in such request. If such
      confirmation is not provided within ten (10) Business Days following
      Nationwide's receipt thereof, the requesting party can assume that such
      payment(s) had not been made. Failure to give any of such notices in the
      foregoing sentences shall not affect the subordination of the Citadel
      Indebtedness to the Nationwide Indebtedness as provided herein.

            (f) The provisions of this Section 2.02 shall not modify or limit in
      any way the application of Section 2.04.

      Section 2.03. Actions in Respect of Citadel Indebtedness.

            (a) Subject in all cases to the terms of this Agreement, Citadel may
      (1) accelerate the Citadel Indebtedness in accordance with the terms of
      the Subordinated Documents; (2) file a claim in respect of the Citadel
      Indebtedness in any Insolvency or Liquidation Proceeding; and (3) take all
      other action necessary to enforce and protect its rights with respect to
      the Citadel Indebtedness.

            (b) In the event of a Citadel Agreement Payment Default, Citadel is
      entitled to exercise all rights and remedies pursuant to the terms of the
      Citadel Agreement and the Subordinated Documents. In the event of a
      Citadel Event of Default other than a Citadel Agreement Payment Default,
      Citadel is entitled to exercise all rights and remedies pursuant to the
      terms of the Citadel Agreement and the Subordinated Documents following
      the earliest to occur of the following: (i) Nationwide has waived this
      provision in writing; (ii) the Nationwide Indebtedness is Fully Paid;
      (iii) the Nationwide Indebtedness is accelerated; and (iv) the expiration
      of ninety (90) days from the occurrence of the Citadel Event of Default in
      question. If the Citadel Event of Default in question is cured within the
      time period set forth in clause (iv) of this paragraph (b) and prior to
      the occurrence of the event described in clause (i), (ii) or (iii) above,
      then, for all purposes of this Agreement, such Citadel Event of Default
      shall be deemed never to have existed. Nothing contained in this Section
      2.03 shall

                                       8
<PAGE>

      in any way affect the rights and remedies of the parties contained in the
      other provisions of this Agreement in the event of an Insolvency or
      Liquidation Proceeding.

            (c) Notwithstanding anything contained herein to the contrary,
      Nationwide, for itself and its successors and assigns, agrees that (i) it
      will not voluntarily release, subordinate or surrender, or, except in
      connection with an assignment of the Nationwide Indebtedness, sell or
      exchange, its Lien on the Equity Collateral unless and until the
      Nationwide Indebtedness shall have been Fully Paid or Citadel shall have
      given its prior consent to such release, and (ii) if Citadel shall be
      subrogated to the rights and interests of Nationwide pursuant to Section
      2.06 hereof or shall acquire the Nationwide Indebtedness pursuant to
      Section 2.11(h) hereof, Nationwide shall assign to Citadel, without
      recourse to, or representation or warranty by, Nationwide, Nationwide's
      Lien on the Equity Collateral and the Borrower Collateral to the extent of
      such Lien.

      Section 2.04 Subordination on Dissolution, Liquidation or Reorganization
of SHC. In the event of any Insolvency or Liquidation Proceeding:

            (a) Unless Nationwide agrees to a different treatment with respect
      to its claim for the Nationwide Indebtedness (as to which Nationwide shall
      have absolutely no obligation), upon any distribution of assets of SHC of
      any kind or character, whether in cash, securities or other property,
      arising out of such Insolvency or Liquidation Proceeding, all Nationwide
      Indebtedness shall be Fully Paid before Citadel is entitled to receive any
      payment or distribution on account of any Citadel Indebtedness;

            (b) Any payment or distribution of assets of SHC of any kind or
      character, whether in cash, securities or other property (including any
      such payment or distribution which may be payable or deliverable by reason
      of the payment of any other indebtedness of SHC being subordinated to the
      Citadel Indebtedness), to which Citadel would be entitled except for the
      provisions of this Section 2.04, shall be paid by SHC, as debtor in
      possession, or any bankruptcy trustee or other agent or other Person
      making such payment or distribution directly to Nationwide, until all
      Nationwide Indebtedness remaining unpaid is Fully Paid, after giving
      effect to any concurrent payments or distributions to or for Nationwide
      for application to the payment of the Nationwide Indebtedness, or any of
      the events described in Section 2.02(b)(i), (ii) or (iii) shall have
      occurred; and

            (c) If, notwithstanding the foregoing provisions of this Section
      2.04, Citadel shall have received any payment or distribution of assets of
      SHC, or the estate created by the commencement of any such Insolvency or
      Liquidation Proceeding, of any kind or character in respect of the Citadel
      Indebtedness, whether in cash, securities or other property, before all
      Nationwide Indebtedness shall have been Fully Paid, such payment or
      distribution shall be received and held in trust for Nationwide, and shall
      promptly be paid over or delivered to

                                       9
<PAGE>

      Nationwide, for the benefit of Nationwide, until all Nationwide
      Indebtedness then remaining unpaid is Fully Paid, after giving effect to
      any concurrent payments or distributions to or for Nationwide for
      application to the Nationwide Indebtedness, or any of the events described
      in Section 2.02(b)(i), (ii) or (iii) shall have occurred.

      Section 2.05. Liens. The Liens on the Collateral in favor of Citadel shall
be subject and subordinate in all respects to the Liens in favor of Nationwide.

      Section 2.06 Citadel to Be Subrogated to Rights of Nationwide. Only after
the Nationwide Indebtedness shall have been Fully Paid, Citadel, to the extent
of any payments or distributions of cash, securities and other assets with
respect to the Citadel Indebtedness made to or for Nationwide pursuant to this
Agreement, shall be subrogated to the rights of Nationwide to receive any and
all payments or distributions of cash, securities and other assets payable with
respect to the Nationwide Indebtedness until all amounts owing on the Citadel
Indebtedness shall have been paid in full. For the purpose of such subrogation,
no such payments or distributions to or for Nationwide that otherwise would have
been made to Citadel but for this Agreement shall, as between SHC and Citadel,
be deemed to be payment by SHC on account of the Citadel Indebtedness; provided,
however, that (x) unless and until, as between Nationwide and Citadel, the
Nationwide Indebtedness is Fully Paid, Citadel shall not have the right, ability
or power to exercise any rights or remedies in respect of or by reason of such
subrogation and (y) such rights of subrogation, and any claims of Citadel with
respect thereto, are nevertheless limited by and subject to Section 11.12 of the
Citadel Agreement.

      Section 2.07. Relative Rights. (a) This Agreement defines the relative
rights of Citadel, on the one hand, and Nationwide, on the other hand. Nothing
in this Agreement is intended to or shall:

                  (i) impair, as between SHC and Citadel, the obligation of SHC
      to pay the amounts payable with respect to the Citadel Indebtedness as and
      when the same shall become due and payable in accordance with its terms;
      or

                  (ii) affect the relative rights against SHC of Citadel and
      creditors of Citadel other than Nationwide.

            (b) Notwithstanding anything herein or elsewhere to the contrary, if
      SHC fails, because of this Agreement or otherwise, to pay principal of or
      interest on the Citadel Indebtedness on the due date thereof, such failure
      shall still be considered an Event of Default under paragraph (a) of
      Section 9.1 of the Citadel Agreement except as otherwise provided in said
      paragraph (a).

                                       10
<PAGE>

      Section 2.08 Continued Effectiveness of this Agreement.

            (a) The terms of this Agreement, the subordination effected hereby,
      and the rights of Nationwide and the obligations of Citadel arising
      hereunder, shall not be affected, modified or impaired in any manner or to
      any extent by: (i) any amendment, modification or termination of or
      supplement to the Nationwide Indebtedness or the Nationwide Agreement, or
      any agreement, instrument or document executed or delivered pursuant
      thereto; (ii) the validity or enforceability of any such document; (iii)
      the release, sale, exchange or surrender, in whole or in part, of any
      collateral security, now or hereafter existing, for any of the Nationwide
      Indebtedness or any other indebtedness, liability or obligations of SHC to
      Nationwide, now existing or hereafter arising; (iv) any exercise or
      non-exercise of any right, power or remedy under or in respect of the
      Nationwide Indebtedness or any of such instruments and documents referred
      to in clause (i) above or arising at law; or (v) any waiver, consent,
      release, indulgence, extension, renewal, modification, delay or other
      action, inaction or omission in respect of the Nationwide Indebtedness or
      any of the agreements, instruments or documents referred to in clause (i)
      above or in respect of any collateral security for the Nationwide
      Indebtedness or any other indebtedness, liability or obligation of SHC to
      Nationwide, now existing or hereafter arising, all whether or not Citadel
      shall have had notice or knowledge of any of the foregoing and whether or
      not Citadel shall have consented thereto.

            (b) The terms of this Agreement, and the rights of Citadel and the
      obligations of Nationwide arising hereunder, shall not be affected,
      modified or impaired in any manner or to any extent by: (i) any amendment,
      modification or termination of or supplement to the Citadel Indebtedness
      or the Subordinated Documents, or any agreement, instrument or document
      executed or delivered pursuant thereto; (ii) the validity or
      enforceability of any such document; (iii) the release, sale, exchange or
      surrender, in whole or in part, of any collateral security, now or
      hereafter existing, for any of the Citadel Indebtedness or any other
      indebtedness, liability or obligations of SHC to Citadel, now existing or
      hereafter arising; (iv) any exercise or non-exercise of any right, power
      or remedy under or in respect of the Citadel Indebtedness or any of such
      instruments and documents referred to in clause (i) above or arising at
      law; or (v) any waiver, consent, release, indulgence, extension, renewal,
      modification, delay or other action, inaction or omission in respect of
      the Citadel Indebtedness or any of the agreements, instruments or
      documents referred to in clause (i) above or in respect of any collateral
      security for the Citadel Indebtedness or any other indebtedness, liability
      or obligation of SHC to Citadel, now existing or hereafter arising, all
      whether or not Nationwide shall have had notice or knowledge of any of the
      foregoing and whether or not Nationwide shall have consented thereto.

                                       11
<PAGE>

      Section 2.09 Provisions to Effectuate Subordination of Citadel
Indebtedness.

            (a) In the event of any Insolvency or Liquidation Proceeding,
      Nationwide is irrevocably authorized and empowered, in its discretion, to
      make and present for and on behalf of Citadel such proofs of claim against
      SHC on account of the Citadel Indebtedness or other motions or pleadings
      as Nationwide may deem expedient or proper, to vote such proofs of claim
      in any such Insolvency or Liquidation Proceeding, to the extent permitted
      by law, and to receive and collect any and all payments or distributions
      made thereon in whatever form and to apply such payments or distributions
      on account of any of the Nationwide Indebtedness. Citadel irrevocably
      authorizes and empowers Nationwide to demand, sue for, collect and receive
      each of such payments and distributions and to file claims and take such
      other actions, in the name of Nationwide or Citadel or otherwise, as
      Nationwide may deem necessary or advisable for the enforcement of this
      Agreement. To the extent that payments or distributions are made in
      property other than cash, Citadel authorizes Nationwide to sell such
      property to such buyers and on such terms as Nationwide, in its reasonable
      discretion, shall determine. Citadel will execute and deliver to
      Nationwide such powers of attorney, assignments and other instruments or
      documents as may be requested by Nationwide in order to enable Nationwide
      to enforce any and all claims upon or with respect to the Citadel
      Indebtedness and to collect and receive any and all payments and
      distributions which may be payable or deliverable at any time with respect
      thereto.

            (b) Nationwide agrees that it will not exercise any of the rights or
      remedies under paragraph (a) of this Section 2.09 unless Citadel has
      failed to implement any action in question within ten (10) days prior to
      when such action is required pursuant to an Insolvency or Liquidation
      Proceeding.

            (c) Citadel specifically waives: unless Nationwide shall otherwise
      give its prior written consent or the Nationwide Indebtedness is Fully
      Paid, (i) the right to seek to give its credit (secured or otherwise) to
      SHC in any way under Section 364 of the Bankruptcy Code unless the same is
      subordinated in all respects to the Nationwide Indebtedness in accordance
      with the terms and conditions of this Agreement; (ii) the right to take a
      position inconsistent with or contrary to that of Nationwide (including a
      position by Nationwide to take no action) if SHC seeks to use, sell or
      lease the Collateral under Section 363 of the Bankruptcy Code or seeks to
      accept or reject any executory contract or lease under Section 365 of the
      Bankruptcy Code; (iii) the right to receive any collateral (including any
      "super priority" or equal or "priming" or replacement Lien) for the
      Citadel Indebtedness, other than the Equity Collateral and the Borrower
      Collateral, in each case subject to Nationwide's Liens thereon to the
      extent provided herein; and (iv) the right to seek adequate protection in
      respect of the Collateral under Section 363 or 361 of the Bankruptcy Code,
      unless and then only to the extent that

                                       12
<PAGE>

      Nationwide does and then only to the extent consistent with the
      subordinated position of Citadel.

      Section 2.10 Subordination not Impaired by Acts or Omissions of SHC or
Nationwide. (a) No right of Nationwide to enforce subordination as provided
herein shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of SHC or, except as provided in Section 2.10(c), by
any act or failure to act by Nationwide, or by any noncompliance by SHC with the
provisions and covenants of the Nationwide Agreement or the Subordinated
Documents, regardless of any knowledge thereof that Nationwide may have or be
otherwise charged with and regardless of whether such action or failure to act
diminishes or destroys any subrogation or other rights that Citadel may have or
reduces or eliminates any eventual recovery in respect of the Citadel
Indebtedness. Without in any way limiting the generality of the foregoing,
Nationwide may, at any time and from time to time, without the consent of or
notice to Citadel, except as provided in Section 2.10(c), without incurring
responsibility to Citadel and without impairing or releasing the subordination
and other benefits provided in this Agreement or the obligations hereunder of
Citadel to Nationwide, do any one or more of the following even if any right to
reimbursement or subrogation or other right or remedy of Citadel is affected,
impaired or extinguished thereby:

                  (i) change the manner, place or terms of payment or extend,
      renew, modify or amend the terms of the Nationwide Indebtedness or any
      agreement or instrument evidencing, securing or guarantying any Nationwide
      Indebtedness (including increasing the amount of principal, changing the
      time and amount of repayments, increasing the rate of interest or
      otherwise changing the terms of the Nationwide Agreement), exercise or
      delay in or refrain from exercising any right or remedy against SHC and
      otherwise deal freely with SHC or any liability of SHC;

                  (ii) release, exercise or delay in or refrain from exercising
      any right or remedy against, change the terms of any agreement or
      instrument with or otherwise deal freely with any guarantor or any other
      Person liable or contingently liable in any manner for the Nationwide
      Indebtedness or any such liability or contingent liability;

                  (iii) settle or compromise any of the Nationwide Indebtedness
      or any other liability of SHC or any guarantor of the Nationwide
      Indebtedness to Nationwide and apply any sums by whomsoever paid and
      however realized to any liability (including, without limitation, the
      Nationwide Indebtedness) in any manner or order; and

                  (iv) fail to take or to record or otherwise perfect, for any
      reason or for no reason, any Lien securing the Nationwide Indebtedness by
      whomsoever granted, and release, sell, exercise or delay in or refrain
      from exercising any right or remedy against, exchange, enforce, realize
      upon, or otherwise deal freely with, in any manner and in any order, any
      of the Collateral.

                                       13
<PAGE>

            (b) Except as provided in Section 2.10(c), Citadel hereby waives any
      and all notice of the creation, modification, renewal, extension or
      accrual of any Nationwide Indebtedness and notice of or proof of reliance
      by Nationwide upon this Agreement, and the Nationwide Indebtedness shall
      conclusively be deemed to have been created, contracted or incurred in
      reliance upon this Agreement, and all dealings between SHC and Nationwide
      shall be deemed to have been consummated in reliance on this Agreement.

            (c) Notwithstanding anything contained in this Agreement or any
      other agreement to the contrary, the consent of Citadel shall be required
      for (i) any amendment or modification of the Nationwide Agreement (any of
      the foregoing being a "Change") (A) changing the dates of payment of
      interest, principal, fees or costs in respect of the Nationwide
      Indebtedness or shortening the maturity of or requiring the earlier
      payment of any principal or interest in respect of the Nationwide
      Indebtedness, (B) increasing the rate of interest or the amount of any
      payments (including the amount of any fees payable in respect of the
      Nationwide Indebtedness), except for the increase in rate provided for
      therein following maturity thereof, whether at stated maturity, by
      acceleration or otherwise, or (C) adding any requirement for SHC to pay
      any additional fees in respect of the Nationwide Indebtedness, or (ii) any
      Change making any material terms and conditions of the Nationwide
      Agreement more restrictive or burdensome on SHC than the terms and
      conditions of the Nationwide Agreement delivered to Citadel and in effect
      on the date hereof. If any Change is made in contravention of this Section
      2.10(c), any additional liabilities or obligations to Nationwide imposed
      thereby on SHC shall not constitute obligations secured by the Collateral
      and, with respect to such additional liabilities or obligations,
      Nationwide shall not be entitled to any of the benefits of this Agreement,
      the Security Agreement or the Pledge Agreement.

      Section 2.11 Additional Agreements and Waivers.

            (a) Citadel hereby waives (i) any requirement for marshaling of
      assets by Nationwide in connection with any foreclosure of the Liens of
      Nationwide on any Collateral or any other realization upon such
      Collateral, and (ii) any other principle of election of remedies.

            (b) Nationwide shall not have any obligation or duty, nor shall
      Citadel have any right to direct Nationwide, to retain, perfect, protect
      or release any Collateral (except as provided in Section 2.03(c)), to
      foreclose or refrain from foreclosing the Lien of Nationwide on any
      Collateral, to act or refrain from acting with respect to any Nationwide
      Event of Default, to act or refrain from acting with respect to the
      collection of any claim from any account debtor, guarantor or any other
      party, to realize upon any collateral or otherwise to

                                       14
<PAGE>

      exercise or refrain from exercising any rights or remedies in respect of
      such Lien or such Collateral. Except with respect to a violation of
      Section 2.03(c), Nationwide shall not be subject to any liability on
      account of taking or refraining from taking any action referred to in this
      Section 2.11(b), and Citadel waives and agrees to refrain from asserting
      against Nationwide any claim seeking damages or other relief by way of
      specific performance, injunction or otherwise, with respect to any action
      taken or not taken by Nationwide with respect to SHC, the Collateral or
      any other Person. Without limiting the foregoing, Citadel waives the right
      to commence or pursue any legal action on account of the exercise or
      non-exercise of rights, remedies or other conduct of Nationwide under the
      Nationwide Agreement or any document entered into in connection therewith,
      including allegations based on a theory of breach of fiduciary obligations
      of Nationwide, duty of care, duty of good faith, duty of reasonableness,
      negligence, equitable subordination of claims, interference with
      contractual relationships, conflicts of interest or otherwise, except for
      willful misconduct by Nationwide or a violation of Section 2.03(c) hereof.

            (c) Solely between Nationwide and Citadel, Citadel assumes
      responsibility for keeping itself informed as to the condition (financial
      or otherwise), business, assets and operations of SHC, the condition of
      the Collateral and all other circumstances that might in any way affect
      Citadel's risk under the Subordinated Documents and this Agreement
      (including without limitation the risk of non-payment of the Nationwide
      Indebtedness), and Nationwide shall have no duty or obligation whatsoever
      to obtain or disclose to Citadel any information or documents relative to
      such condition (financial or otherwise), business, assets or operations of
      SHC, such Collateral or such risk, whether acquired by Nationwide in the
      course of its relationship with SHC or otherwise. The terms of this
      Section 2.11(c) shall not impair or affect SHC's obligations arising under
      any Credit Agreement or any of the Subordinated Documents.

            (d) Citadel agrees that the subordination hereunder applies
      regardless of the validity or enforceability of the Nationwide
      Indebtedness or the Nationwide Agreement or the validity, perfection or
      enforceability of the Liens securing the Nationwide Indebtedness.

            (e) Citadel agrees not to (i) take any action to challenge the
      validity, enforceability or amount of any guaranty of the Nationwide
      Indebtedness given by any other Person, (ii) induce any other Person to
      take such action, or (iii) cooperate with any other Person in taking such
      action.

            (f) Within fifteen (15) days following the written request from
      Nationwide or SHC, Citadel shall deliver to SHC and Nationwide an estoppel
      certificate setting forth (i) the amount of principal and interest then
      due, if any, and other amounts then payable (to the extent then
      ascertainable), if any, in respect of the Citadel Indebtedness and (ii)
      whether or not the Subordinated Documents have been amended since the date
      hereof or the date of the

                                       15
<PAGE>

      last such certificate delivered pursuant hereto, as the case may be, and
      if so, providing a copy of the relevant amendment documents.

            (g) Within fifteen (15) days following the written request from
      Citadel, each of Nationwide and SHC shall deliver to Citadel an estoppel
      certificate setting forth (i) the amount of principal and interest then
      due, and other amounts then payable (to the extent ascertainable), in
      respect of the Nationwide Indebtedness and (ii) whether or not the
      Nationwide Agreement has been amended since the date hereof or the date of
      the last such certificate delivered pursuant hereto, as the case may be,
      and, if so, providing a copy of the relevant amendment documents.
      Nationwide confirms that, as of the date hereof, the outstanding principal
      sum of the Nationwide Indebtedness is eleven million Dollars
      ($11,000,000), and no other sums are now accrued or payable under the
      Nationwide Agreement except accrued interest, not currently due, in
      accordance with the terms of the Nationwide Agreement.

            (h) (i) At any time following a Trigger Event, upon the request of
      Citadel and upon at least five (5) Business Days' prior written notice to
      Nationwide, Nationwide will assign to Citadel, without any recourse to, or
      representation or warranty by, Nationwide, the Nationwide Agreement (other
      than Nationwide's claims, if any, in respect of interest and other fees
      and costs thereunder, to the extent not included in the Nationwide
      Accrual) (the "Retained Claims"), which Retained Claims shall be retained
      by and remain the property of Nationwide) upon the payment to Nationwide,
      or as it may direct in writing, of the sum of (x) the principal amount of
      the Nationwide Indebtedness or $11,000,000, whichever is less, and (y) the
      Nationwide Accrual; provided, however, that the Nationwide Indebtedness
      and the Nationwide Agreement, as assigned, will then be subject to Section
      11.12 of the Citadel Agreement. Upon such assignment, this Agreement shall
      terminate and all rights and obligations between Nationwide and Citadel
      shall terminate, except as provided in this Section 2.11(h). Upon such
      assignment, the combined assigned Nationwide Indebtedness and the Citadel
      Indebtedness shall be treated for purposes of this Agreement as if such
      combined Indebtedness were the Nationwide Indebtedness and the Retained
      Claims shall be treated as if such Retained Claims were the Citadel
      Indebtedness; provided, however, that nothing herein shall affect, limit
      or impair the right of Nationwide to enforce, collect and retain free from
      any limitations or restrictions of this Agreement payment of the Retained
      Claims from any Person other than SHC.

            (ii) At Citadel's election, payment to Nationwide or an Affiliate
      thereof for the amount required to be paid pursuant to subsection
      2.11(h)(i) may be made by it or an Affiliate making and delivering a note
      for the full amount due, payable in full ninety (90) days from its date,
      with interest thereon payable at the rate of 8.25% monthly in arrears and
      on the date of payment in full (increasing to 9.75% following maturity
      thereof, whether at stated maturity, by acceleration or otherwise);
      provided, however, that Nationwide (or such

                                       16
<PAGE>

      Affiliate) may require that the maturity date of the note be extended to
      such later date, not beyond the expiration of the Initial Term of the
      Lease Agreement as may be requested by Nationwide (or such Affiliate) in a
      notice given to Citadel not later than sixty (60) days prior to the
      originally stated maturity date of such note, in which case the maker of
      the note and, if applicable, the guarantor thereof shall execute and
      deliver such additional documents to confirm such extension as may be
      appropriate. Such note, if made by an Affiliate of Citadel, shall be fully
      guaranteed as to payment by Citadel, or may in the first instance be made
      by Citadel (in which case no guaranty shall be required). The note and, if
      applicable, the guaranty shall be on terms and conditions reasonably
      satisfactory to Nationwide. The option provided herein in favor of Citadel
      to pay through delivery of a note and, if applicable, a guaranty shall not
      be available in connection with the exercise of the Purchase Option
      pursuant to the Lease Agreement and any such note shall be pre-payable in
      full upon the closing pursuant to the Purchase Option or the purchase or
      other acquisition by Citadel (or an Affiliate) of the Membership Interest
      in SHC.

                  (iii) Upon the payment to Nationwide of the amount required to
      be paid to it pursuant to subsection 2.11(h)(i) (whether in cash or by the
      making and delivery of a note and, if applicable, a guaranty), Nationwide
      shall, as Citadel may request, either satisfy or assign (without recourse
      to, or representation or warranty by, Nationwide) as Citadel shall direct
      any and all Liens securing the Nationwide Indebtedness and any claims
      (other than the Retained Claims) with respect thereto; provided, however,
      that such Liens and claims, if so assigned, will be subject to the
      limitations of Section 11.12 of the Citadel Agreement. Any and all
      Retained Claims shall be unsecured claims and any judgment thereon shall
      not be enforced against or be or become Liens on any assets of SHC.

                  (iv) If the Trigger Event is a Citadel Proceeding and if a Bad
      Faith Determination is entered with respect thereto, then Citadel shall be
      liable: (x) to Nationwide, for all costs and expenses (including
      reasonable fees and expenses of counsel and other professional advisors)
      incurred by Nationwide in connection with the Citadel Proceeding and in
      seeking such Bad Faith Determination and for interest (at the
      Reimbursement Rate) on any taxes paid by Nationwide as a result of the
      transfer or repayment of the Nationwide Indebtedness for the period from
      the date such taxes were paid until the date such taxes would have been
      paid if the Nationwide Indebtedness had been repaid at the maturity date
      thereof; and (y) to SHC and its Affiliates, for all costs and expenses
      (including reasonable fees and expenses of counsel and other professional
      advisors) incurred by SHC and its Affiliates in connection with the
      Citadel Proceeding and in seeking such Bad Faith Determination. If
      following the initiation of a Citadel Proceeding either Nationwide or any
      of its Affiliates or SHC or any of its Affiliates, or any other Person
      acting in concert with or with the support of any of them, unsuccessfully
      asserts a claim for a Bad Faith Determination, then Nationwide (if it or
      any of its Affiliates asserted such claim) or James J. Cotter and Michael
      R. Forman (if SHC or any of its Affiliates asserted such claim) shall be

                                       17
<PAGE>

      liable to Citadel for all costs and expenses (including reasonable fees
      and expenses of counsel and other professionals) incurred by Citadel in
      defending against the claim for a Bad Faith Determination.

      Section 2.12. Transferees of Creditors; Notice of Subordination.

            (a) Each Creditor shall not at any time sell, assign, pledge,
      hypothecate, or otherwise transfer its Credit Agreement (or any of its
      respective rights or interests therein), unless and until the transferee,
      pledgee, or other appropriate party shall have assumed in a writing,
      reasonably satisfactory to the other, all of the transferring, pledging,
      or hypothecating Creditor's obligations under this Agreement.

            (b) Each Creditor warrants and represents to the other Creditor that
      it has not previously assigned any interest in its respective
      Indebtedness, that no party owns an interest in its Indebtedness other
      than itself and that its entire Indebtedness is owing only to it. Each
      Creditor covenants that its entire Indebtedness shall continue to be owing
      only to it, unless assigned or transferred in accordance with the terms of
      this Agreement.

      Section 2.13. Representations and Warranties. (a) Each Creditor hereby
represents and warrants for the benefit of the other as follows: (i) the
execution, delivery and performance of this Agreement are within its corporate
power and authority and have been duly authorized by all necessary corporate
action and this Agreement constitutes the legal, valid and binding obligation of
each Creditor enforceable against it in accordance with its terms, except as
enforceability may be limited by equitable principles or by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally; and (ii) all consents for, in the case of
Nationwide, the amending of the Existing Nationwide Agreement to the Nationwide
Agreement and, in the case of Citadel, the funding to SHC pursuant to the
Citadel Agreement have been obtained and are in effect (or will be obtained and
in effect upon the date of funding).

            (b) Nationwide hereby represents to Citadel that, upon the tender in
      cash of the amount of the Nationwide Indebtedness in the amount and
      subject to the conditions set forth in Section 2.11(h)(i) hereof, the
      assignment provided for in said Section 2.11(h)(i) will be provided
      whether or not Nationwide is then the holder of the Nationwide
      Indebtedness.

      Section 2.14. Restriction on Amendments to Subordinated Documents. Neither
SHC nor Citadel shall, without the prior written consent of Nationwide, waive,
amend or modify any of the terms and conditions of any Subordinated Document if
the effect of such waiver, amendment or modification is to (a) advance maturity
dates, (b) increase rates or amounts of payments, (c) change any provision
herein, or (d) otherwise make any such terms and conditions more restrictive or
burdensome on SHC than the terms and conditions of the Subordinated Documents
delivered to Nationwide and in effect on the date hereof or at the time of such
amendment or modification.

                                       18
<PAGE>

      Section 2.15. Continuing Agreement of Subordination. This is a continuing
agreement of subordination and Nationwide may continue, at any time and without
notice to Citadel, to extend credit or other financial accommodations to or for
the benefit of SHC in reliance hereon. This Agreement shall be effective and may
not be terminated or otherwise revoked by Citadel until the Nationwide
Indebtedness has been Fully Paid. If Citadel shall have any right under
Applicable Law or otherwise to terminate or revoke this Agreement which cannot
be waived, then, to the extent permitted by law, such termination or revocation
shall not be effective until written notice of such termination or revocation,
signed by Citadel, is given to the holder of such Nationwide Indebtedness. Any
such termination or revocation shall not affect this Agreement in relation to
(a) any Nationwide Indebtedness which arose prior to the receipt thereof, or (b)
any of the Nationwide Indebtedness created after receipt thereof, if such
Nationwide Indebtedness was incurred either through committed advances or
re-advances by Nationwide pursuant to the Nationwide Agreement.

      Section 2.16. Further Assurances.

            (a) Upon the occurrence and during the continuation of a Nationwide
      Default, Citadel shall duly and promptly take such action as Nationwide
      may reasonably request (a) to collect the Citadel Indebtedness for the
      account of Nationwide and to file appropriate claims or proofs of claims
      in respect of the Citadel Indebtedness, (b) to execute and deliver to
      Nationwide such assignments or other instruments as Nationwide may
      reasonably request in order to enable it to enforce any and all claims
      with respect to the Citadel Indebtedness and any security interests
      securing payment of the Citadel Indebtedness, and (c) to collect and
      receive any and all payments or distributions which may be payable or
      deliverable with respect to the Citadel Indebtedness.

            (b) Nothing contained in this Agreement shall affect Citadel's
      obligations to make any advances pursuant to the terms of the Citadel
      Agreement.

                                   ARTICLE III
                                  MISCELLANEOUS

      Section 3.01 Amendments, Etc. No amendment, waiver or modification of any
provision of this Agreement, nor consent to any departure by any party hereto
therefrom, shall in any event be effective unless the same shall be in writing,
making specific reference to this Agreement and such amendment, waiver,
modification or consent shall be consented to in one or more writings signed by
or consented to by all the parties hereto, and then such amendment, waiver,
modification or consent shall be effective only in the specific instance and for
the specific purpose for which given.

      Section 3.02 Notices, Etc. All notices, offers, acceptances, approvals,
waivers, requests, demands and other communications required or permitted
hereunder or under any other instrument,

                                       19
<PAGE>

certificate or other document delivered in connection with the transactions
described herein shall be in writing, shall be addressed as provided below and
shall be considered as properly given (a) if delivered in person, (b) if sent by
express courier service (including, without limitation, Federal Express, Emery,
DHL, Airborne Express, and other similar express delivery services), (c) in the
event overnight delivery services are not readily available, if mailed by United
States Postal Service, postage prepaid, registered or certified with return
receipt requested, or (d) if sent by telecopy and confirmed; provided, that in
the case of a notice by telecopy, the sender shall in addition confirm such
notice by writing sent in the manner specified in clause (a), (b) or (c) of this
Section 3.02. All notices shall be effective upon receipt by the addressee;
provided, however, that if any notice is tendered to an addressee and the
delivery thereof is refused by such addressee, such notice shall be effective
upon such tender. For the purposes of notice, the addresses of the parties shall
be as set forth below; provided, however, that any party shall have the right to
change its address for notice hereunder to any other location by giving written
notice to the other party in the manner set forth herein. The initial addresses
of the parties hereto are as follows:

                           If to Citadel:

                           Reading International, Inc.
                           550 South Hope Street
                           Suite 1825
                           Los Angeles, CA 90071
                           Facsimile: (213) 235-2220
                           Attention: Chief Financial Officer

                           with required copies to

                           S. Craig Tompkins
                           Reading International, Inc.
                           550 South Hope Street, Suite 1825
                           Los Angeles, CA  90071
                           Facsimile: (213) 235-2229

                           If to SHC:

                           Sutton Hill Capital, L.L.C.
                           120 North Robertson Blvd.
                           Los Angeles, California  90048
                           Attention:  Legal Department
                           Telecopier No.:  (310) 652-6490

                                       20
<PAGE>

                           If to Nationwide:

                           Nationwide Theatres Corp.
                           c/o Pacific Theatres
                           Los Angeles, California  90048
                           Attention: Legal Department
                           Telecopier No.: (310) 652-6490

                           with required copies to

                           Ira Levin
                           Pacific Theatres
                           120 North Robertson Boulevard
                           Los Angeles, CA 90048
                           Telecopier: (310) 652-6490

Each such notice, request or other communication shall be effective when
actually received.

      Section 3.03 No Waiver; Remedies. No failure on the part of any party
hereto to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.

      Section 3.04 Costs and Expenses. Each Creditor agrees to pay on demand all
costs and expenses of the other Creditor in connection with the successful
enforcement of this Agreement against the first Creditor (including without
limitation for reasonable fees and expenses of counsel).

      Section 3.05 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.

      Section 3.06 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

      Section 3.07 Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature

                                       21
<PAGE>

page to this Agreement by telecopier shall be effective as delivery of a
manually executed counterpart of this Agreement.

      Section 3.08 Waiver of Jury Trial. THE PARTIES HERETO HEREBY IRREVOC"BLY
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

      Section 3.09 Evidence of Understanding. Citadel shall, promptly upon the
request of Nationwide, and Nationwide shall, promptly upon the request of
Citadel, execute and deliver such other documents and instruments as Nationwide
or Citadel, as the case may be, may deem reasonably necessary or appropriate (in
proper form for recording or filing, if requested) to more fully implement or
further evidence the understandings and agreements contained in this Agreement.

      Section 3.10 Conflict of Provisions. In the event of any conflict between
any term, covenant or condition of this Agreement and any term, covenant or
condition of the Nationwide Agreement, the Subordinated Documents, or any
documents executed in connection therewith or the indebtedness evidenced
thereby, the provisions of this Agreement shall control and govern.

      Section 3.11 Respective Rights. This Agreement sets forth the respective
rights of Citadel, on the one hand, and Nationwide, on the other hand, and, as
such, has not been entered into for the benefit of SHC and may not be enforced
by SHC. SHC is executing and delivering this Agreement solely to confirm to the
other parties that it is aware that such other parties have entered into this
Agreement and that it consents to the other parties' entering into this
Agreement (though the foregoing shall not imply that SHC's consent was or is
required for the execution and delivery of this Agreement by such other parties,
or that its obligations pursuant to the Nationwide Agreement or the Subordinated
Documents are affected in any way if an amendment is made hereto, or a waiver is
granted hereunder, without SHC's consent).

      Section 3.12 Termination. This Agreement shall terminate upon payment in
full of the Nationwide Indebtedness and all other amounts due under the
Nationwide Agreement.

      Section 3.13. Section Headings. The Section headings in this Agreement are
for convenience of reference only and shall not affect the interpretation
hereof.

      Section 3.14. Limited Recourse. SHC's obligations hereunder are intended
to be the obligations of the limited liability company only and no recourse for
the payment of any amount due hereunder, or for any claim based thereon or
otherwise in respect thereof, shall

                                       22
<PAGE>

be had against any member of SHC or any incorporator, member, officer, director
or Affiliate, as such, past, present or future of such limited liability
company, it being understood that SHC is a limited liability company formed for
the purpose of the transactions involved in and relating to the Citadel
Agreement on the express understanding aforesaid. Nothing contained in this
Section shall be construed to limit the exercise or enforcement, in accordance
with the terms of this Agreement, of the rights and remedies against the limited
liability company or the assets of the limited liability company or affect
claims under Section 5 of the Pledge Agreement or under the Indemnity Guarantee
(as such terms are defined in the Citadel Agreement).

      Section 3.15 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provisions in any other jurisdiction.

      Section 3.16 Bankruptcy. This Agreement shall be applicable both before
and after the commencement, whether voluntary or involuntary, of any case under
the Bankruptcy Code (or similar state law) involving SHC, and all references
herein to SHC shall be deemed to apply to SHC as a debtor-in-possession and to
any trustee in bankruptcy for the estate of SHC.

                                       23
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.

                                           READING INTERNATIONAL, INC.

                                           By:__________________________________
                                               Name:
                                               Title:

                                           NATIONWIDE THEATRES CORP.,

                                           By:__________________________________
                                               Name:
                                               Time:

                                           SUTTON HILL CAPITAL, L.L.C.,

                                           By:__________________________________
                                               Name:
                                               Title:

                                       24
<PAGE>

                                           FOR PURPOSES OF THE LAST SENTENCE OF
                                           SECTION 2.11(h)(iv) ONLY:

                                               _________________________________
                                               James J. Cotter

                                               _________________________________
                                               Michael R. Forman

                                       25
<PAGE>

                                    EXHIBIT H

                               THEATRE PROPERTIES

1.    The Village East Cinemas located at 181 Second Avenue, New York, New York
      10013

2.    The Sutton Theatre located at 205 East 57th Street, New York, New York
      10022.

3.    Cinemas 1, 2 and 3 located at 1001 Third Avenue, New York, New York 10022

                                       26
<PAGE>

                                    EXHIBIT I

                                   SITE LEASES

(a) That certain Indenture of Lease dated as of January 31, 1987 between Senyar
Holding Company, as landlord, and M-Square Theaters, Inc., as tenant, covering
premises at 181-189 Second Avenue, New York, New York 10003, containing the
Village East Theatre, as amended by that certain First Amendment to Lease, dated
as of June 15, 1989, between Senyar Holding Company and M-Square Theaters, Inc.
and the letter regarding notices, dated December 20, 1993 from Senyar Holding
Company to M-Square Theatres, Inc.;

(b) The ground lease dated February 9, 1961 between Andrew C. Mayer, et al., as
landlord, and Turtle Bay Theatre Corporation, as tenant, covering premises at
1001, 1003 1005 and 1007 Third Avenue, New York, New York 10022, containing
Cinemas 1, 2 and 3, the tenant's interest therein having been assigned to (i)
Sutcin Holding Corp. pursuant to that Assignment & Assumption of Lease dated
December 31, 1984 between Cinemas 5 Ltd., as successor in liquidation to Turtle
Bay Theatre Corporation, and Sutcin Holding Corp., and (ii) Sutton Hill
Associates pursuant to that Agreement of Purchase and Sale and related
Assignment of Lease, each dated July 3, 1986 between Sutcin Holding Corp. and
Sutton Hill Associates; and

(c) That certain Ground Lease dated as of August 16, 1985, between Sutcin
Holding Corp., as landlord, and Sutton Hill Associates, as tenant, covering the
premises at 205 East 57th Street, New York, New York 10022, containing the
Sutton Theater as amended by the First Addendum to Ground Lease, dated as of
January 1, 1992, between Sutcin Holding Corp. and Sutton Hill Associates, Second
Addendum to Ground Lease, dated as of January 1, 1995, between Sutcin Holding
Corp. and Sutton Hill Associates, Third Addendum to Ground Lease, dated as of
July 1, 1996, between Nationwide (successor-in-interest to Sutcin Holding Corp.)
and Sutton Hill Associates, Fourth Addendum to Ground Lease, dated as of July
28, 2002, between Nationwide and Sutton Hill Associates and Fifth Addendum to
Ground Lease, dated as of January 29, 2002 between Nationwide and Sutton Hill
Associates.

                                       27

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