Document:

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                                                                   EXHIBIT 10.13

                      GUARANTY OF SUTTON HILL ASSOCIATES

     GUARANTY AGREEMENT (this "Guaranty"), dated as of July 28, 2000, between
SUTTON HILL ASSOCIATES, a California general partnership (the "Guarantor") and
Citadel Cinemas, Inc., a Nevada corporation (together with its successors, the
"Beneficiary").

                                   RECITALS
     A.  The Guarantor is the sole member of Sutton Hill Capital, L.L.C., a New
York limited liability company (together with its permitted successors, the
"Company").

     B.  The Beneficiary and the Company are about to enter into an agreement,
dated as of the date hereof (as the same may be amended, restated, modified or
supplemented from time to time, the "Lease Agreement"), pursuant to which the
Company will sublease various Theatre Properties as described therein to the
Beneficiary.

     C.  The Company has agreed to make certain representations and warranties
to the Beneficiary in subsection 2.3 of the Lease Agreement.

     D.  The Beneficiary and the Company are about to enter into a letter
agreement, dated as of the date hereof (as the same may be amended, restated,
modified or supplemented from time to time, the "Financial Letter Agreement"),
pursuant to which the Company has agreed to make certain representations and
warranties regarding the financial condition of the operations of the Theatre
Properties.

     E.  The Beneficiary and the Company's affiliate, City Cinemas Corporation,
a New York corporation ("City Cinemas"), are about to enter into an agreement,
dated as of the date hereof (as the same may be amended, restated, modified or
supplemented from time to time, the "Employee Letter"), pursuant to which the
Beneficiary has agreed to assume the duties and responsibilities as employer
with respect to the employees of City Cinemas.

     F.  City Cinemas has agreed to make certain representations and warranties
to the Beneficiary with respect to the employees in Section 2 of the Employee
Letter.

     G.  The Beneficiary is unwilling to enter into the Lease Agreement, the
Financial Letter Agreement and the Employee Letter unless the Guarantor enters
into this Guaranty.

     NOW THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor hereby agrees as follows:

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     Section 1.  Guaranty of Obligations. Subject to the terms and conditions
                 ------------------------
in this Guaranty, the Guarantor hereby unconditionally guarantees to the
Beneficiary the due and punctual payment when due of all amounts arising under
the Lease Agreement and Financial Letter Agreement, as the case may be, as a
result of the Company's breach of the representations and warranties made in
subsection 2.3 of the Lease Agreement and in the Financial Letter Agreement and
arising under the Employee Letter as a result of City Cinemas' breach of the
representations and warranties made in Section 2 of the Employee Letter (such
obligations being herein called the "Obligations"), and agrees to pay any and
all reasonable expenses incurred by the Beneficiary in successfully enforcing
any rights under this Guaranty. This Guaranty is a primary and original
obligation of the Guarantor and is an absolute, unconditional, continuing and
irrevocable guaranty of payment and not of collectibility or performance and is
in no way conditioned or contingent upon any attempt to collect from the Company
or City Cinemas, as the case may be, or to realize upon any property
constituting security for the Obligations, all to the same extent, except as
otherwise specifically provided herein, as if the Guarantor were the Company
under the Lease Agreement or Financial Letter Agreement, or City Cinemas under
the Employee Letter; provided, however, that the foregoing limitation imposing
on the Guarantor obligations hereunder as if it were the Company under the Lease
Agreement or Financial Letter Agreement, or City Cinemas under the Employee
Letter (except as set forth herein) shall not limit obligations of the Guarantor
hereunder to the extent the limitations (including termination, disavowal,
rejection or reduction) of any such obligation of the Company or City Cinemas,
as the case may be, results from (a) any insolvency or bankruptcy case or
proceeding (including any case under the U.S. Bankruptcy Code of 1978, as
amended), or any receivership, liquidation, reorganization or other similar case
or proceeding relative to the Company or City Cinemas, as the case may be, or
all or substantially all of their respective assets, or (b) any liquidation,
dissolution, reorganization or winding up of the Company or City Cinemas, as the
case may be, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment of all or substantially all of
the assets of the Company or City Cinemas, as the case may be, for the benefit
of creditors or any other marshalling of assets and liabilities of the Company
or City Cinemas, as the case may be (the events in (a), (b) and (c) collectively
referred to as an "Insolvency or Liquidation Proceeding"), and in such event the
Guarantor shall be liable in respect of obligations of the Company pursuant to
the Lease Agreement or Financial Letter Agreement, or of City Cinemas pursuant
to the Employee Letter, as if no such Insolvency or Liquidation Proceeding had
been initiated. If the Company or City Cinemas, as the case may be, shall fail
to pay any of the Obligations when and as the same shall become due and payable,
the Guarantor shall forthwith pay such Obligations, in immediately available
funds, directly to the Beneficiary at its address specified herein or at such
other place as the Beneficiary shall direct. The Guarantor hereby waives
diligence, presentment or protest. Each default in payment of any of the
Obligations shall give rise to a separate cause of action hereunder and separate
suits may be brought hereunder as each cause of action arises. Notwithstanding
anything herein to the

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contrary, the obligations of the Guarantor hereunder shall be limited to the
same extent as set forth in paragraph (c) of Section 11 of the Lease Agreement,
but shall not be limited by the provisions of Section 30 of the Lease Agreement.

     Section 2.  Character of Obligations Hereunder: Subrogation. (a) The
                 -----------------------------------------------
right of the Beneficiary to enforce the obligations of the Guarantor hereunder
by any proceedings, whether by action at law, suit in equity or otherwise, shall
not be impaired by any right, claim or defense (against the Company or any other
person) of any character whatsoever, including without limitation any right,
claim or defense of rescission, recoupment, reduction, limitation, termination,
setoff, counterclaim, waiver, frustration, surrender, alteration or compromise
except, and then only to the extent, any such right, claim or defense would have
been available to the Company pursuant to the Lease Agreement or Financial
Letter Agreement, or to City Cinemas pursuant to the Employee Letter. Without
limiting the generality of the foregoing, such obligations of the Guarantor
shall not be discharged, released or impaired or otherwise affected by: (i) any
renewal, extension, amendment or modification of or addition or supplement to or
deletion from this Guaranty or the Lease Agreement, Financial Letter Agreement
or Employee Letter except to the extent of the Company's or City Cinemas'
rights, claims or defenses thereunder as aforesaid, as the case may be; (ii) any
inability or failure on the part of the Company to perform or comply with the
Lease Agreement or Financial Letter Agreement or on the part of City Cinemas to
perform or comply with the Employee Letter; (iii) any waiver, consent,
extension, indulgence or other action or inaction (including, without
limitation, any lack of diligence) under or in respect of this Guaranty, the
Lease Agreement, the Financial Letter Agreement, the Employee Letter or any
obligation or liability of the Company or City Cinemas, or any other person, or
any exercise or non-exercise of any right, power or remedy under or in respect
of any such agreement or any such obligation or liability; (iv) any Insolvency
or Liquidation Proceeding; and (v) any limitation or any party's obligation or
liability under any such agreement or any such obligation or liability or any
termination, cancellation, frustration, invalidity or enforceability, in whole
or in part, of any such agreement or any such obligation or liability or any
term of any thereof except to the extent of the Company's or City Cinemas'
rights, claims or defenses thereunder as aforesaid.

     (b)  This Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Obligations is rescinded
or must otherwise be returned by the Beneficiary upon the insolvency, bankruptcy
or reorganization of the Company or City Cinemas or otherwise, all as though
such payment had not been made.

     (c)  The Guarantor will not exercise any rights which it may acquire by way
of subrogation under this Guaranty, by any payment made hereunder or otherwise,
until all of the Obligations shall have been paid in full. If any amount shall
be paid to the Guarantor on account of such subrogation rights at any time when
all the Obligations then outstanding shall not have been indefeasibly paid in
full, such amount shall be held in trust for the benefit of the Beneficiary and
shall forthwith be paid to the Beneficiary and applied upon the Obligations,
whether matured

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or unmatured. If (i) the Guarantor shall make payment to the Beneficiary of all
or any part of the Obligations and (ii) all the Obligations shall be paid in
full and the period under the Lease Agreement, Financial Letter Agreement and
Employee Letter for the Beneficiary to assert claims against the Company or City
Cinemas shall have expired, the Beneficiary will, at the Guarantor's request,
execute and deliver to the Guarantor appropriate documents, without recourse and
without representation or warranty, necessary to evidence the transfer by
subrogation to the Guarantor of an interest in the Obligations resulting from
such payment by the Guarantor.

     Section 3.  Representations and Warranties of the Guarantor. The Guarantor
                 -----------------------------------------------
represents and warrants to the Beneficiary that:

          (a)    The Guarantor is a general partnership duly organized and
     validly existing under the laws of California and has full power, authority
     and legal right to carry on its business as currently conducted, to own its
     properties and to enter into and perform its obligations under this
     Guaranty;

          (b)    The execution, delivery and performance by the Guarantor of
     this Guaranty have been duly authorized by all necessary partnership action
     and do not and will not contravene any presently existing law or any
     governmental rule, regulation or order applicable to the Guarantor or its
     properties;

          (c)    The execution, delivery and performance by the Guarantor of
     this Guaranty do not require the consent or approval or authorization or
     order of, the giving of notice to, or the registration with, or the taking
     of any other action in respect of, any governmental authority or agency,
     foreign or domestic, other than such as have been duly obtained, given or
     taken; and

          (d)    This Guaranty has been duly executed and delivered by the
     Guarantor and constitutes the legal, valid and binding obligation of the
     Guarantor, enforceable against the Guarantor in accordance with its terms,
     except as the enforceability of this Guaranty may be limited by the effect
     of any applicable bankruptcy, insolvency, reorganization, moratorium, or
     similar laws affecting creditors' rights generally and by general
     principles of equity.

     Section 4.  Miscellaneous.
                 -------------

     (a)  No failure on the part of the Beneficiary to exercise, no delay in
exercising, and no course of dealing with respect to, any right or remedy
hereunder will operate as a waiver thereof; nor will any single or partial
exercise of any right or remedy hereunder preclude any exercise of any other
right or remedy. This Guaranty may not be amended or modified except by written
agreement of the Guarantor and the Beneficiary.

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     (b)  All notices in connection with this Guaranty shall be in writing,
shall be deemed given and shall become effective when delivered by hand or
courier service or received by telex, telecopier, telegram, cable or registered
or certified first-class mail, postage prepaid, addressed as follows: if to the
Guarantor, at 120 North Robertson Blvd., Los Angeles, California 90048; if to
the Beneficiary, addressed to 550 South Hope Street, Suite 1825, Los Angeles, CA
90071, or at such other addresses which either of the foregoing shall from time
to time designate in writing.

     (c)  The terms of this Guaranty shall be binding upon the Guarantor and its
successors and assigns and shall inure to the benefit of, and be enforceable by,
the Beneficiary and its successors and assigns.

     (d)  This Guaranty shall be construed in accordance with and governed by
the internal laws of the State of New York.

     (e)  If any term of this Guaranty and any other application thereof shall
be invalid or unenforceable, the remainder of this Guaranty and any other
application of such terms shall not be affected thereby.

     (f)  Each of the parties hereto (i) hereby irrevocably submits to the non-
exclusive jurisdiction of the Supreme Court of the State of New York, New York
County (without prejudice to the right of any party to remove to the United
States District Court for the Southern District of New York) and to the non-
exclusive jurisdiction of the United States District Court for the Southern
District of New York, for the purposes of any suit, action or other proceeding
arising out of this Guaranty or the subject matter hereof or any of the
transactions contemplated hereby or thereby brought by either of the parties
hereto or their successors or assigns, (ii) hereby irrevocably agrees that all
claims in respect of such action or proceeding may be heard and determined in
such New York State court or, to the fullest extent permitted by applicable law,
in such Federal court, (iii) hereby waives any right it may have to trial by
jury in respect of any litigation based on, arising out of, under or in
connection with this Guaranty, and (iv) to the extent permitted by applicable
law, hereby irrevocably waives, and agrees not to assert, by way of motion, as a
defense or otherwise, in any such suit, action or proceeding any claim that it
is not subject to the jurisdiction of the above-named courts, that the suit,
action or proceeding is brought in an inconvenient forum, that the venue of the
suit, action or proceeding is improper or that this Guaranty or the subject
matter hereof may not be enforced in or by such court. A final judgment obtained
in respect of any action, suit or proceeding referred to in this Section 4 shall
be conclusive and may be enforced in other jurisdictions by suit or judgment or
in any manner as provided by applicable law. Each of the parties hereto hereby
consents to service of process by registered mail, Federal Express, DHL or
similar courier at the address to which notices to it are to be given, it being
agreed that service in such manner shall constitute valid service upon such
party or its respective successors or assigns in connection with any such action
or proceeding only; provided, however, that nothing in this Section 4 shall
affect the right of any of such parties or their respective successors or

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assigns to serve legal process in any other manner permitted by applicable law
or affect the right of any of such parties or its respective successors or
assigns to bring any action or proceeding against any other one of such parties
or its respective property in the courts of other jurisdictions.

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     IN WITNESS WHEREOF, the parties hereto have caused this Guaranty to be duly
executed as of the date first set forth herein.

                              GUARANTOR:
                              SUTTON HILL ASSOCIATES

                              By:  /s/ James J. Cotter
                                 ---------------------------------
                                 Name:  James J. Cotter
                                 Title: Partner

                              BENEFICIARY:
                              CITADEL CINEMAS, INC.

                              By:  /s/ Andrzej Matyczynski
                                 ---------------------------------
                                 Name:  Andrzej Matyczynski
                                 Title: Chief Financial Officer

                                      98<PAGE>

                                                                   EXHIBIT 10.14

                               LICENSE AGREEMENT

     This License Agreement (the "License"), dated as of July 28, 2000 (the
                                  -------
"Effective Date"), by and between Sutton Hill Capital, L.L.C., a New York
 --------------
limited liability company, having an office at 120 North Robertson Boulevard,
Los Angeles, California 90048, as licensor (together with its successors, legal
representatives and assigns, the "Licensor"), and Citadel Cinemas, Inc., a
                                  --------
Nevada corporation having an office at 550 South Hope Street, Suite 1825, Los
Angeles, CA 90071, as licensee (together with its successors, legal
representatives and permitted assigns, the "Licensee").
                                            --------

                              W I T N E S S E T H
                              -------------------

     WHEREAS, Licensor owns certain leasehold interests in certain public movie
theatres, namely, (i) the Village East Cinemas, located at 181 Second Avenue,
New York, New York 10003 (the "Village East Cinemas"), (ii) the Sutton Theatre,
                               --------------------
located at 205 East 57th Street, New York, New York 10022 (the "Sutton
                                                                ------
Theatre"), (iii) the Murray Hill Theatre, located at 160 East 34th Street, New
-------
York, New York 10016 (the "Murray Hill Theatre"), and (iv) Cinemas 1, 2 and 3,
                           -------------------
located at 1001 Third Avenue, New York, New York 10022 ("Cinemas 1, 2 and 3"),
                                                         ------------------
each of which theatres is hereinafter referred to individually as a "Licensed
                                                                     --------
Theatre" and all of which are collectively hereinafter referred to as the
-------
"Licensed Theatres";
 -----------------

     WHEREAS, Licensor owns or possesses certain rights, titles and interests in
and to certain trademarks, trade names, trade dresses, service marks and other
intellectual property used in connection with the presentation, promotion,
operation and/or management (hereinafter, collectively referred to as "Operation
                                                                       ---------
and/or Management"), of one or more of the Licensed Theatres, each of which
-----------------
intellectual properties is hereinafter referred to individually as a "Licensed
                                                                      --------
Property", and all of which are hereinafter referred to collectively as the
--------
"Licensed Properties" and described on the annexed Schedule A, which is hereby
 -------------------                               ----------
incorporated and made part of this License;

     WHEREAS, Licensee desires to obtain the right and license from Licensor to
use the Licensed Properties in the Territory (as hereinafter defined) in
connection with Licensee's Operation and/or Management of the Licensed Theatres
in conformity with the terms and conditions of this License and the Lease
Agreement executed contemporaneously with this License and effective as of the
Effective Date (hereinafter the "Operating Lease"); and
                                 ---------------

     WHEREAS, Licensor is willing to grant such right and license to Licensee on
the terms and conditions set forth below;

     NOW, THEREFORE, in consideration of the foregoing premises, the mutual
covenants herein contained, and other good and valuable consideration, the
receipt and sufficiency of which

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are hereby acknowledged, the parties hereto (hereinafter, individually, a
"Party" and, collectively, the "Parties") agree as follows:
 -----                          -------

     SECTION 1.  DEFINITIONS.

     1.1  Defined Terms.
          -------------

     (a) Unless otherwise herein defined or otherwise required by the context,
each of the defined terms used herein shall have the meaning set forth in
Section 1 of the Operating Lease.  In those instances in which the terms and
conditions of the Operating Lease are herein incorporated and made part of this
License, references to the terms "Tenant", "Landlord" and "Lease" as they appear
                                  ------    --------       -----
in the Operating Lease shall here apply, mutatis mutandis, so as to refer to
"Licensee", "Licensor" and "License", respectively, with respect to this
 --------    --------       -------
License.

     (b) "Cinema Assets" means the leasehold interests in the Cinemas 1, 2 and
          -------------
3, the Murray Hill Theatre, the Sutton Theatre, and the Village East Cinemas.

     (c) The words "hereof", "herein" and "hereunder" and words of similar
                    ------    ------       ---------
import when used in this License shall refer to this agreement as a whole and
not to any particular provision of this License, and section, subsection,
paragraph, schedule and exhibit references are to this License unless otherwise
specified.  Unless otherwise required by the context, the meanings given to the
terms defined herein shall be equally applicable to both the singular and plural
forms of such terms.

     SECTION 2.  SCOPE OF GRANT.

     2.1  Grant.
          -----

     (a) Licensor hereby grants to Licensee, subject to the terms and conditions
of this License, an exclusive, royalty-free license to use in the Territory, in
connection with Licensee's Operation and/or Management of the Licensed Theatres,
the Licensed Properties owned or used by Licensor in connection with Licensor's
Operation and/or Management of the Licensed Theatres as of the Effective Date.

     (b) The right and license hereby granted to Licensee apply solely to
Licensee's use of the Licensed Properties, solely in connection with the
Operation and/or Management of the Licensed Theatres, and solely within the
Territory, in accordance with the express terms and conditions of this License.

     (c) Notwithstanding the foregoing, Licensee may use the name "City Cinemas"
in connection with Licensee's Operation and/or Management of any movie theatre
located in the New York metropolitan area (the "Extended Territory"), and, with
respect to the use of such

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name, the term Licensed Theatres shall include any such theatre located in the
Extended Territory.

     2.2  Territory.
          ---------

     With respect to each of the Licensed Properties, the "Territory" of
                                                           ---------
Licensee's permitted use of such Licensed Property shall mean as follows:

     (a) Trade Names.  The Territory of permitted use of each trade name
         -----------
licensed under this agreement, all composites and variations of such trade
names, and all trademarks, service marks and other words, names, symbols,
devices and materials that use or incorporate any of such trade names in whole
or in substantial part (hereinafter referred to individually as a "Licensed
                                                                   --------
Trade Name" and collectively as the "Licensed Trade Names"), shall be
----------                           --------------------
exclusively (i) on premises at the specific site of the particular Licensed
Theatre designated by such Licensed Trade Name as of the Effective Date of this
License (for example, by presentation on the Licensed Theatre's marquee), and
(ii) for purposes of advertising, publicity and/or promotion for such Licensed
Theatre, the metropolitan area in which such Licensed Theatre is located,
namely, the New York City metropolitan area.

     (b) Limitations on Certain Other Licensed Properties.  To the extent any of
         -------------------------------------------------
the Licensed Properties other than Licensed Trade Names consist of licensed or
contractual rights, the license granted herein is subject to the terms and
conditions of the applicable license or contract.

     (c) Other Use of Licensed Properties.  The foregoing site and territorial
         --------------------------------
restrictions notwithstanding, Licensee shall have the right to use the Licensed
Trade Names and other Licensed Properties anywhere within the United States of
America and its territories solely for purposes of (i) identifying or promoting
Licensee's business as the licensed operator and/or manager of the Licensed
Theatres pursuant to this License, and/or (ii) conducting the Operation and/or
Management of the Licensed Theatres at or from Licensee's office(s) in
accordance with the terms and conditions of this License, provided, however,
                                                          --------  -------
that Licensee shall not use any of the Licensed Trade Names or other Licensed
Properties, in whole or in substantial part, as Licensee's corporate, business
or trade name, or in any manner as is likely to cause confusion, mistake or
deception as to the association or affiliation of Licensor and/or Licensee or
the source or sponsorship of either of their businesses, services or goods.

     (d) City Cinemas Name.  In addition to the foregoing, Licensee may use the
         -----------------
City Cinemas name within the Extended Territory, in connection with any Licensed
Theatre within the Territory or Extended Territory, and for purpose of
identifying the Licensed Theatres as a group or any of them individually.

     SECTION 3.  SUBLICENSE AND ASSIGNMENT.

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     (a) Licensor has granted the License hereunder in reliance upon Licensee's
ability and obligation to maintain such high standards as to service,
cleanliness, health and sanitation as will preserve and enhance the valuable
reputation and goodwill associated with the Licensed Trade Names and other
Licensed Properties.  Accordingly, neither Licensee nor any principals or owners
of any equity interest or security in Licensee shall, without the prior written
consent of Licensor in each such instance or in accordance with the conditions
of the next sentence of this paragraph, sublicense, sell, assign, transfer,
convey, delegate, give away, pledge, mortgage or otherwise encumber, in whole or
in part (hereinafter, collectively, effect any "Transfer" or "Lien" of):  (i)
                                                --------      ----
this License, or any right, license, interest, duty or obligation of Licensee
hereunder; or (ii) all or substantially all of the assets of any of the
Licensee's Licensed Theatre establishments.  Any such Transfer or Lien without
such prior written consent shall be null and void ab initio, unenforceable and
of no force or effect; provided, however, that Licensee may effect such Transfer
                       --------  -------
if such Transfer is to any Person to whom a transfer or assignment of the
Operating Lease is made in accordance with the terms of the Operating Lease so
long as the transferee of such Transfer shall have agreed for the benefit of
Licensor, in a duly executed and enforceable writing, to be bound by the terms
of this License and all of the promises and obligations of Licensee hereunder
with respect to the Licensed Properties so transferred from and after the date
of the Transfer; and provided, further, that Licensee may effect any such Lien
                 --- --------  -------
in connection with a mortgage or other encumbrance on the leasehold interest of
the Tenant under the Operating Lease as is permitted pursuant to the terms
thereof.  Licensor shall be expressly named as an intended beneficiary of each
such written assignment agreement and Licensee shall deliver Licensor a copy of
each such assignment within ten (10) days of the execution thereof.

     (b) Licensee shall notify Licensor in writing of any proposed Transfer
and/or Lien before the proposed transaction or event is to take place, and shall
provide such information and documentation relating to the proposed Transfer
and/or Lien as Licensor may reasonably require.  Licensee shall deliver to
Licensor a conformed copy of each such agreement of Transfer or Lien within
thirty (30) days of the execution thereof.

     (c) No sublicense, assignment or other Transfer or Lien by Licensee shall
relieve Licensee of its obligations hereunder.  Licensor's consent to any such
Transfer or Lien shall not constitute a waiver of any claims it may have against
the Licensee or other transferring party, nor shall it be deemed a waiver of
Licensor's right to demand exact compliance with any of the terms of this
License by the Licensee, transferor or transferee.

     (d) Any attempted or actual assignment, sublicense or other Transfer or
Lien not in full compliance with this Section 3 shall be null and void and shall
constitute a material breach of, and Event of Default under, this License, for
which Licensor may immediately terminate the License and the right and license
granted hereunder.

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     (e) Neither this Section 3 nor any provision of this License shall, or
shall be construed to, prohibit or restrict Licensor's right or power to
Transfer, or grant a Lien on, this License in whole or in part, subject,
however, to the rights of Licensee pursuant to Section 9 hereof.

     (f) Licensor does not, by the terms of this License or otherwise, require
Licensee to develop, adopt or implement any business, sales, operating or
marketing plan, or assume any right or power to control, manage or direct the
day-to-day operations of Licensee's business, the control and conduct of which
shall remain within the sole and exclusive discretion of Licensee.  Accordingly,
no sublicensing of this License or any of the rights or licenses granted
hereunder shall be made by Licensee to any potential sublicensee, under any
terms, in any circumstance, or in any jurisdiction, as may cause Licensor to be
deemed a franchisor or as may cause Licensor to be made subject to any special
duty, obligation or liability prescribed by any law, regulation or authority
governing franchises, dealerships or "business opportunities" in any respect.
                                      ----------------------
Licensee shall nevertheless at all times comply with all applicable laws,
regulations or authorities governing franchises, dealerships and "business
                                                                  --------
opportunities", if any, including, but not limited to, all disclosure and
-------------
registration requirements thereof.

     SECTION 4.  TERM.

     (a) Unless terminated earlier pursuant to the terms hereof, the "Initial
                                                                      -------
Term" of this License and of the right and license granted hereunder shall be
----
coterminous with the Initial Term of the Operating Lease as set forth in Section
6 thereof.  Accordingly, the Initial Term of this License shall commence on the
Effective Date and shall continue for one hundred twenty (120) calendar months,
unless the Operating Lease or this License is terminated earlier pursuant to its
express provisions.

     (b) In the event that the Initial Term of the Operating Lease shall have
expired and the Operating Lease or this License shall not thereupon or earlier
have been terminated, and said Operating Lease is renewed pursuant to the terms
of Section 12 thereof, the "Renewal Term" of this License and of the right and
                            ------------
license granted hereunder shall be coterminous with the Renewal Term of the
Operating Lease as set forth in Section 12 thereof.  Accordingly, such Renewal
Term, if any, shall commence upon the day following the expiration day of the
Initial Term and shall continue for one hundred twenty (120) calendar months,
unless the Operating Lease or this License is earlier terminated pursuant to its
express provisions.

     SECTION 5.  LICENSEE'S ACCEPTANCE OF RIGHTS; ACKNOWLEDGMENT OF LICENSOR'S
     OWNERSHIP

     (a) Licensee hereby accepts the exclusive right and license in and to the
Licensed Properties granted by this License and agrees to exercise such right
and license in full

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compliance with all Legal Requirements and the material terms and conditions of
the Operating Lease and this License.

     (b) Licensee acknowledges and agrees:  that, as between Licensor and
Licensee, Licensor's ownership of all right, title and interest in and to the
Licensed Properties (including, without limitation, all goodwill associated
therewith and registration rights therein) is valid and subsisting, and is and
shall remain vested solely in Licensor, subject only to the right and license
granted to Licensee hereunder or under such written amendment hereto or other
written license agreement as may hereafter be entered into between Licensor and
Licensee; that the right and license granted hereunder shall not create in
Licensee any ownership rights in or to any of the Licensed Properties but only a
license to the use thereof in the defined Territory during the term of this
License in accordance with the terms and conditions hereof; that all use of the
Licensed Properties by or on behalf of Licensee, and all goodwill arising
thereunder, shall inure solely to the benefit of Licensor unless and until
Licensee acquires the Licensed Properties in accordance with Section 9 hereof;
and that neither this License nor any provision hereof shall be construed as an
assignment by Licensor of any right, title or interest in or to any of the
Licensed Properties, it being understood and agreed by the Parties that all
right, title or interest in and to the Licensed Properties are expressly
reserved by Licensor except for the limited rights being licensed hereunder.

     (c) Licensee shall not at any time, during the term of this License or
thereafter, anywhere in the world directly or indirectly challenge, dispute,
impugn or impair the validity, or Licensor's ownership or registration, of any
of the Licensed Properties or of any right, title or interest of Licensor
therein.

     SECTION 6.  USE OF THE LICENSED PROPERTIES; QUALITY CONTROL

     (a) Licensee recognizes and acknowledges that it is of paramount importance
to Licensor that the high quality of the image, reputation and goodwill
associated with Licensor, the Licensed Theatres, the Licensed Trade Names and
other Licensed Properties be protected and maintained at all times, and that
Licensee must, therefore, maintain such quality in the Licensed Properties and
Licensed Theatres.  Accordingly, Licensee agrees that such use and presentation
of the Licensed Properties as Licensee may make in connection with the Licensed
Theatres shall be consistent with the foregoing standards.

     (b) Licensee shall affix to, or display in connection with, all stationery,
literature, advertising and promotional materials, signage, packaging, labels,
trade dress, supplies, equipment, facilities, and other goods, products and
materials that embody or bear any of the Licensed Properties such clear and
conspicuous notices of Licensor's proprietary rights as may be required fully to
preserve and protect Licensor's rights in the Licensed Properties and to comply
with all Legal Requirements relating thereto.  By way of illustration, and not
limitation, such notices and legends shall, where so required or appropriate to
protect Licensor's rights and

                                      104
<PAGE>

interests, include the symbol "7" or legend "Registered U.S. Trademark" with
                                             -------------------------
respect to such of the Licensed Properties, if any, as are comprised of
registered trademarks.

     (c) Licensee shall, within ten (10) Business Days of any written request of
Licensor, provide Licensor with representative samples of all stationery,
literature, advertising and promotional materials, signage, packaging, labels,
trade dress, supplies, equipment and other goods, products and materials that
Licensee uses, or anticipates within a reasonable period following the date of
such request to use, in connection with any Licensed Trade Name or any other
Licensed Property.  If Licensor finds any of said, or other, uses by Licensee of
the Licensed Properties objectionable, by reason of the nonconforming quality of
Licensee's goods, services or facilities, manner of use of the Licensed
Properties, or otherwise, notice of objection citing specifics shall be given to
Licensee within ten (10) Business Days after Licensor's receipt of the samples
provided by Licensee in accordance with this Paragraph 6(c).  In response to any
such objection, Licensee shall either advise Licensor of the steps Licensee
intends to take to alleviate Licensor's concerns, in which case, absent
additional objection from Licensor, Licensee shall with reasonable diligence
implement such steps, or shall advise Licensor that Licensee does not agree with
Licensor's objections, in which event the Parties shall promptly meet and confer
to attempt to resolve their differences.

     (d) Licensee agrees that upon the termination or expiration of the Initial
Term or Renewal Term of this License, for any reason whatsoever, Licensee shall,
except in the event Licensee is assigned Licensor's right, title and interest in
the Licensed Properties pursuant to Section 9 hereof or as may be otherwise
expressly herein permitted, forthwith discontinue the use of the Licensed
Properties, and thereafter shall no longer use, or have any right or license to
use, any of the Licensed Properties or any means of identification of source,
affiliation, association or sponsorship used by Licensor, or by any Affiliate of
Licensor, whether in any trademark, trade name, service mark, trade dress or
otherwise, or whether alone or in combination with any other word, name, symbol
or device.

     SECTION 7.  DEFAULTS AND REMEDIES FOR DEFAULT.

     7.1  Events of Default and Remedies.
          ------------------------------

     With respect to each Event of Default, the applicable cure period shall be
as described below but, if a cure period is not specifically mentioned, it shall
be thirty (30) days; provided, however, that if Licensee's default is such that
                     --------  -------
remedy or cure may be effected, but cannot reasonably be completed within said
thirty (30) day period, then Licensee shall commence to diligently and
continuously take all reasonable steps to effect such remedy or cure of such
Event of Default within said thirty (30) day period and shall complete the
rendering of such remedy or cure promptly thereafter; provided, further, that,
                                                      --------  -------
in connection with the Events of Default listed in clauses (a) and (b) no notice
of default or time to cure shall be required or available.  In some cases, as
identified below, no cure period is allowed and no notice may be required.  If
any

                                      105
<PAGE>

applicable law or rule requires a longer notice period or a longer cure period
than that provided herein, then the period required under the law or rule shall
be substituted for the requirements herein. The following shall constitute
Events of Default hereunder:

          (a) The occurrence of any Event of Default under the Operating Lease
     that is not cured within the applicable cure period (if any) thereunder.

          (b) Licensee shall cause or permit any Lien to arise against, or
     undertakes any Transfer of, any of the Licensed Properties, this License or
     any right or license granted hereunder, other than as is permitted
     hereunder or under the Operating Lease.

          (c) Licensee shall continue to be in breach of any other of the
     material terms or conditions of this Agreement.

     7.2  Equitable and Other Relief.
          ---------------------------

     (a)  If an Event of Default shall arise under this License and Licensee
shall fail to cure the default after any required notice and within the
applicable cure period (if any), Licensor may, at its option and without
prejudice to any other rights or remedies provided for hereunder or by law,
terminate this License by written notice or otherwise.

     (b)  Licensee acknowledges that, in the event of a breach or threatened
breach by Licensee of its obligations under this License, Licensor is likely to
suffer irreparable injury for which there is no adequate remedy at law and that
Licensor, therefore, shall be entitled to apply for and receive a temporary
restraining order, preliminary injunction, permanent injunction and such other
equitable or injunctive relief as may be available to restrain Licensee from any
breach or threatened breach of any term or condition hereof, without any
requirement for the posting of a bond or other security.  The prevailing Party
in any such proceeding shall be entitled to reimbursement from the other Party
of any expenses (including, without limitation, reasonable attorney's fees)
incurred in connection with such proceeding.

     7.3  Automatic Termination.  This License, and all right and license
          ---------------------
granted hereunder, shall automatically terminate immediately upon and
simultaneously with the expiration  or termination of the Operating Lease  for
any reason.

     7.4  Effect of Termination or Expiration.
          -----------------------------------

     (a)  Upon and after the expiration or termination of this License, except
as provided in Section 9 hereof, Licensee's right to use the Licensed Properties
shall terminate immediately and all right and license granted to Licensee
hereunder shall forthwith revert to Licensor. Accordingly, upon and after such
expiration or termination, Licensee shall not (i) reproduce, prepare derivative
works based upon, distribute copies of, or publicly perform or display, any

                                      106
<PAGE>

copyrighted work encompassed by the Licensed Properties, (ii) use any of the
Licensed Trade Names, or any trade name, trademark, service mark or trade dress
encompassed by, or confusingly similar to any of those encompassed by, the
Licensed Properties, or (iii) identify itself as a licensee of Licensor or
publicly identify itself as a former licensee of Licensor.

     (b) Expiration or earlier termination of this License for any reason will
not release either Party from any obligation or liability that exists as of the
date of expiration or termination (or which may thereafter come into being) as
the result of any breach or other act or omission occurring prior to expiration
or termination.

     (c) Upon termination or expiration of this License, Licensor shall purchase
all usable paper goods, containers, printed menus and point of sale materials
embodying or bearing any of the Licensed Trade Names or other Licensed
Properties at Licensee's cost.

     (d) In the event Licensee has changed the name of any of the Licensed
Properties existing on the Effective Date, Licensee agrees that, immediately
upon the termination or expiration of this License, it shall at its sole cost
and expense make such removals or changes in signage and other presentation of
the Licensed Theatres as Licensor may reasonably request to reflect the names of
the Licensed Theatres as of the date hereof.

     7.5 Remedies Nonexclusive.
         ---------------------

     No remedy referred to in this Section 7 is intended to be exclusive, but
each shall be cumulative and in addition to any other remedy referred to in this
License or otherwise available to Licensor at law, in equity or otherwise, and
the exercise in whole or in part by Licensor of any one or more of such remedies
shall not preclude the simultaneous or later exercise by Licensor of any or all
such other remedies.  No waiver by Licensor of any Event of Default hereunder
shall in any way be, or be construed to be, a waiver of any other, future or
subsequent Event of Default, whether similar or dissimilar to such waived Event
of Default.

     SECTION 8.  INFRINGEMENT AND DILUTION.

     (a) In the event that either Party shall receive any information to the
effect that any third party is, or is suspected of, infringing, diluting or
misappropriating any of the Licensed Properties, or has initiated any claim of,
or suit alleging, any such infringement, dilution or misappropriation, the Party
in receipt of such information shall promptly give written notice thereof to the
other Party.

     (b) In the event of such infringement, dilution or misappropriation of any
of the Licensed Properties, the decision as to whether to institute or maintain
a legal action or proceeding shall rest in the sole discretion of Licensor.
Licensor shall have sixty (60) days from the receipt of written notice pursuant
to Section 8(a) hereof to commence and control the prosecution of such action or
proceeding, in its own name, by and through its own counsel and at

                                      107
<PAGE>

its own cost and expense (and/or, if necessary, in the name of Licensee), to
secure and protect Licensor's rights in the Licensed Properties. In reaching any
such decision, Licensor shall give reasonable consideration to the needs of
Licensee for protection in its use of the Licensed Properties and Licensee shall
have the right to participate in such action or proceeding by and through
Licensee's own counsel and at its own cost and expense. If Licensor does not
commence such action or proceeding within the specified sixty (60) day period,
Licensee shall, subject to applicable law, have the right, but not the
obligation, to commence such action or proceeding in its own name (and/or, if
necessary, in the name of Licensor), by and through Licensee's own counsel and
at its own cost and expense, to secure and protect the right and license herein
granted and to recover damages for the infringement or impairment thereof.

     (c) Licensee and Licensor agree to cooperate, at no expense to the other,
in any such action or proceeding brought pursuant to Section 8(b) hereof, and to
provide any needed assistance to the other Party in connection therewith.  The
foregoing provisions notwithstanding, the Parties may agree in writing to share
the costs of and recoveries from any such action or proceeding as may hereafter
arise.

     SECTION 90  OPTION AND ASSIGNMENT.

     (a) In the event that Licensee exercises its purchase option pursuant to
Section 12 of the Operating Lease, and does, in fact, purchase and acquire all
of the Cinema Assets from Licensor, contemporaneously with the closing of such
purchase and acquisition of the Cinema Assets in accordance with the terms of
the Operating Lease, Licensor shall, without separate consideration for the
transfer provided herein, assign to Licensee all of Licensor's right, title and
interest in and to the Licensed Properties, together with the goodwill of the
business, or portion thereof, which is symbolized by the Licensed Properties and
pertains thereto.

     (b) As soon as practicable after the closing date of Licensee's purchase
and acquisition of the Cinema Assets, Licensor shall execute and deliver, or
cause to be executed and delivered, to Licensee all assignments, schedules and
other appropriate documentation, and take such actions as are reasonable and
necessary, to effectuate, validate and, where applicable, record, the
assignment, transfer and conveyance to Licensee of the Licensed Properties.

     SECTION 10.  INDEMNIFICATION.

     (a) Licensor assumes no liability to Licensee or to any third parties with
respect to Licensee's use of any of the Licensed Properties, including, without
limitation, any liability for or in connection with the formulation, design,
manufacture, preparation, reproduction, transfer, distribution, shipment, use,
sale, offering for sale, advertising, promotion, display, performance or
provision of any works, inventions, discoveries, goods or services by, for, or
on behalf of, Licensee with or without use of any of the Licensed Properties.

                                      108
<PAGE>

     (b) Licensee shall, and hereby does, indemnify, defend, protect and hold
harmless Licensor and the other Indemnified Persons in accordance with, and to
the full extent of, the obligations undertaken by the Tenant pursuant to terms
and conditions of Section 11 of the Operating Lease, which are hereby
incorporated and made part of this License.

     SECTION 11.  TAXES.

     Licensee shall pay when due all taxes levied or assessed for or in
connection with any Licensed Property licensed under this License, or in
connection with amounts paid or received under this License, including without
limitation any sales, use or other ad valorem taxes (other than any tax that is
measured by or related to the net income of Licensor or to its corporate status
in a state).  If any such tax shall be paid by Licensor, Licensee shall promptly
reimburse Licensor the amount paid.  In the event of any bona fide dispute as to
the liability for a tax assessed against Licensee, Licensee may contest the
validity or the amount of the tax in accordance with procedures of the taxing
authority.  Licensee shall not permit a tax sale or seizure against any Licensed
Theatre or the equipment or facilities thereof.

     SECTION 12.  NOTICES AND REQUESTS.

     Any notices, offers, acceptances, approvals, waivers, requests, demands and
other communications required or permitted hereunder shall be in accordance with
the terms and conditions of Section 25 of the Operating Lease, which are hereby
incorporated, mutatis mutandis, and made part of this License.

     SECTION 130  INDEPENDENT CONTRACTORS.

     (a) The relationship between Licensor and Licensee is that of independent
contractors.  Neither Party is or shall be the agent, partner, joint venturer,
joint employer or employee of the other for any purpose whatsoever, and no
fiduciary relationship between the Parties does or shall exist.  Neither Party
has or shall have any power or authority to make or give any promise, warranty
or representation, to execute any contract or otherwise create, issue or assume
any liability, obligation or commitment in the name of or on behalf of the other
Party, except to the extent and for the specific purpose, if any, as may
hereafter be specifically authorized in writing by the other Party.  Neither
Party shall have the right or power to bind or obligate the other Party with
respect to any third party in any way, nor shall either Party represent that it
has any right or power to do so.  Nothing contained in this License shall be
construed so as to create a partnership or joint venture, or agency, employment,
joint employment, fiduciary, franchise, dealership or "business opportunity"
                                                       --------------------
relationship.

     SECTION 140  GOVERNING LAW; JURISDICTION.

                                      109
<PAGE>

     The choice of law, jurisdiction, venue and other provisions set forth in
Section 28(d) of the Operating Lease are hereby incorporated, mutatis mutandis,
and made part of this License, as follows:

     THIS LICENSE HAS BEEN EXECUTED AND DELIVERED IN THE STATE OF NEW YORK.
LICENSEE AND LICENSOR AGREE THAT, TO THE MAXIMUM EXTENT PERMITTED BY THE LAW OF
THE STATE OF NEW YORK, THIS LICENSE, AND THE RIGHTS AND DUTIES OF LICENSEE AND
LICENSOR HEREUNDER, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING, WITHOUT LIMITATION, SECTIONS
5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) IN ALL RESPECTS,
INCLUDING, WITHOUT LIMITATION, IN RESPECT OF ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE.  LICENSEE HEREBY IRREVOCABLY SUBMITS, FOR ITSELF AND
ITS PROPERTY, TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK AND THE SUPREME COURT OF THE STATE OF NEW YORK IN
THE COUNTY OF NEW YORK IN ANY ACTION, SUIT OR PROCEEDING BROUGHT AGAINST IT AND
RELATED TO OR IN CONNECTION WITH THIS LICENSE OR THE TRANSACTIONS CONTEMPLATED
HEREBY, AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, LICENSEE HEREBY WAIVES
AND AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE IN ANY SUCH
SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURT, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER, OR THAT THIS LICENSE OR ANY DOCUMENT OR ANY INSTRUMENT REFERRED TO
HEREIN OR THE SUBJECT MATTER HEREOF MAY NOT BE LITIGATED IN OR BY SUCH COURT.
THIS SUBMISSION TO JURISDICTION IS NONEXCLUSIVE AND DOES NOT PRECLUDE LICENSOR
FROM OBTAINING JURISDICTION OVER LICENSEE IN ANY COURT OTHERWISE HAVING
JURISDICTION.  TO THE EXTENT PERMITTED BY APPLICABLE LAW, LICENSEE AGREES NOT TO
SEEK AND HEREBY WAIVES THE RIGHT TO ANY REVIEW OF THE JUDGMENT OF ANY SUCH COURT
BY ANY COURT OF ANY OTHER NATION OR JURISDICTION WHICH MAY BE CALLED UPON TO
GRANT AN ENFORCEMENT OF SUCH JUDGMENT.  LICENSEE AGREES THAT SERVICE OF PROCESS
MAY BE MADE UPON IT BY CERTIFIED OR REGISTERED MAIL TO THE ADDRESS FOR NOTICES
SET FORTH IN THE OPERATING LEASE AND INCORPORATED BY REFERENCE HEREIN, OR BY ANY
METHOD AUTHORIZED BY THE LAWS OF NEW YORK.  THE LICENSOR AND LICENSEE EXPRESSLY
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER IN TORT OR CONTRACT OR OTHERWISE) IN ANY WAY RELATED TO THIS LICENSE OR
THE TRANSACTIONS CONTEMPLATED HEREBY.  LICENSOR AND LICENSEE ACKNOWLEDGE THAT
THE PROVISIONS OF THIS SECTION 14 HAVE BEEN

                                      110
<PAGE>

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

     SECITON 150  WAIVERS.

     Any waiver of any right or remedy with respect to any failure of the
Licensor or the Licensee to comply with any agreement, covenant or condition of
this License must be made in a writing signed by the Party to be charged with
such waiver.  The failure of Licensor to exercise any right or option given to
it under this License, or to insist upon strict compliance by Licensee with the
terms and conditions of this License, shall not constitute a waiver of, or
estoppel with respect to, any terms or conditions of this License with respect
to any other or subsequent breach, nor a waiver by or estoppel of Licensor with
respect to its right at any time thereafter to require exact and strict
compliance with the terms and conditions of this License.

     SECTION 160  REPRESENTATIONS, WARRANTIES AND COVENANTS

     16.1 Representations and Warranties of Licensor.
          ------------------------------------------

     Licensor represents and warrants to Licensee as follows:

     (a)  To Licensor's knowledge, information and belief, Licensee's use of the
Licensed Properties in connection with the Operation and/or Management of the
Licensed Theatres will not infringe any third party's intellectual property
rights when used in accordance with the terms and conditions of this License.

     (b)  As of the Effective Date hereof, there are no infringement orders,
suits or claims pending or threatened in writing against Licensor that relate to
any of the Licensed Properties.

     (c)  To Licensor's knowledge, Licensor has good title to the Licensed
Properties, free and clear of all Liens.  Licensor has not received written
notice of any adverse claim with respect to Licensor's use or ownership of any
Licensed Property.  Schedule A sets forth the Licensed Properties which are
                    ----------
registered trademarks, and the registration for each such registered trademark
is held in the name of Licensor.  Licensor has the right to grant to Licensee
the right and license granted to Licensee pursuant to Section 2 of this License
without obtaining the consent of any other person or entity; Licensor has not
entered into any agreements, Transfers, Liens or encumbrances inconsistent with
Licensee's use of the Licensed Properties in connection with the Operation
and/or Management of the Licensed Theatres in accordance with the terms and
conditions of this License.

     (d)  LICENSOR EXPRESSLY DISCLAIMS ANY AND ALL OTHER WARRANTIES ARISING OUT
OF, RELATING TO OR IN CONNECTION WITH THE LICENSED PROPERTIES, WHETHER EXPRESS
OR IMPLIED.  LICENSEE HAS

                                      111
<PAGE>

DETERMINED TO USE THE LICENSED PROPERTIES IN CONNECTION WITH THE OPERATION
AND/OR MANAGEMENT OF THE LICENSED THEATRES ON THE BASIS OF ITS OWN JUDGMENT.
EXCEPT AS EXPRESSLY SET FORTH HEREIN OR IN THE OPERATING LEASE, NEITHER THE
LICENSOR NOR ANY AFFILIATE, NOR ANYONE ACTING ON BEHALF OF ANY OF THEM, MAKES
ANY REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, AS TO THE SAFETY, TITLE, CONDITION, QUALITY,
QUANTITY, FITNESS FOR USE, MERCHANTABILITY, CONFORMITY TO SPECIFICATION, OR ANY
OTHER CHARACTERISTIC, OF ANY LICENSED PROPERTY, OR ANY GOOD, SERVICE, APPARATUS,
FACILITY, MATERIAL OR OTHER MATTER THAT BEARS OR EMBODIES ANY LICENSED PROPERTY;
OR AS TO WHETHER ANY LICENSED PROPERTY OR THE OWNERSHIP, USE, OCCUPANCY OR
POSSESSION OF THE LICENSED PROPERTY OR ANY GOOD, SERVICE, APPARATUS, FACILITY,
MATERIAL OR OTHER MATTER THAT BEARS OR EMBODIES ANY LICENSED PROPERTY, COMPLIES
WITH ANY LAWS, RULES, REGULATIONS OR REQUIREMENTS OF ANY KIND.

     16.2 Mutual Representations and Warranties.
          --------------------------------------

     (a)  Neither the entry into, nor any provision, exercise or enforcement of,
this License shall create or effect any license or other transfer of any right,
title, interest, duty or other subject matter that may not lawfully be licensed
or transferred without the consent of a third party, unless such consent shall
have been given.  Licensor and Licensee each hereby warrant and represent that,
to their knowledge, no such consent is required to enter into or exercise this
License.

     (b)  Licensor and Licensee each hereby warrant and represent that it has
all necessary power and authority to enter into this License and to perform its
obligations hereunder, the execution of this License by it and the performance
of its obligations hereunder have been duly authorized, and this License
Agreement constitutes a legal, valid and binding obligation of such Party,
enforceable against it in accordance with its terms.

     170  MISCELLANEOUS.

     (a)  The Introduction shall be considered a part of this License. To the
extent, if any, that any provision of this License conflicts with any term or
condition of the Operating Lease, the respective agreements shall be construed
cy pres so, as near as possible, to effect the Parties' contractual intent while
at the same time preserving Licensor's entire right, title and interest in and
to the Licensed Properties.

     (b)  All agreements, indemnities, representations and warranties set forth
in this License shall survive the expiration or other termination hereof,
provided that such survival shall
-------- ----

                                      112
<PAGE>

not be construed to extend the term of any right or license granted to Licensee
hereunder beyond the expiration or termination of this License.

     (c) This License shall inure to the benefit of and be binding upon the
Parties and their permitted successors and assigns.

     (d) Each of the undersigned individuals represents and warrants that he or
she is duly authorized and has the full power and authority: (i) to enter into
this License on behalf of the undersigned Party on behalf of which that
individual purports to execute this License; and (ii) to bind said undersigned
Party in any dealings with the other Parties to this License; and (iii) to
direct any action necessary to ensure said undersigned Party's compliance with
this License.

                                      113
<PAGE>

     IN WITNESS WHEREOF, the Parties have caused this License to be executed and
delivered by their duly authorized officers as of the day and year first above
written.

Licensor:                              Licensee:
SUTTON HILL CAPITAL, L.L.C.            CITADEL CINEMAS, INC.

By: /s/ James J. Cotter                By: /s/ Andrzej Matyczynski
    -----------------------------          ----------------------------------
    Name:  James J. Cotter                 Name:  Andrzej Matyczynski
    Title: Operating Manager               Title: Chief Financial Officer

                                      114
<PAGE>

                                  SCHEDULE A

                              LICENSED PROPERTIES

City Cinemas
Murray Hill Theatre
Cinemas I, II, and III
Village East Theatre
Sutton Theatre

                                      115

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