<SUBMISSION>
<ACCESSION-NUMBER>0000722077-01-500050
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20010628
<FILING-DATE>20010810
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>AMC ENTERTAINMENT INC
<CIK>0000722077
<ASSIGNED-SIC>7830
<IRS-NUMBER>431304369
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>0401
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>001-08747
<FILM-NUMBER>1703511
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>106 WEST 14TH STREET
<STREET2>PO BOX 219615
<CITY>KANSAS CITY
<STATE>MO
<ZIP>64121-9615
<PHONE>8162214000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>106 WEST 14TH STREET
<STREET2>PO BOX 219615
<CITY>KANSAS CITY
<STATE>MO
<ZIP>64121-9615
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>edgarized.htm
<TEXT>
<HTML>
<HEAD>
</HEAD>
<BODY LINK="#0000ff" VLINK="#800080">

<P>&nbsp;</P><DIR>
<DIR>
<DIR>

<B><FONT SIZE=4><P ALIGN="CENTER">UNITED STATES</P>
<P ALIGN="CENTER">SECURITIES AND EXCHANGE COMMISSION</P>
</B></FONT><P ALIGN="CENTER">WASHINGTON, D.C. 20549</P>
<B><FONT SIZE=4><P ALIGN="CENTER">FORM 10-Q</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(Mark One)</P>
</FONT><B><FONT SIZE=4><P ALIGN="CENTER">[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF</P>
<P ALIGN="CENTER">THE SECURITIES EXCHANGE ACT OF 1934</P>
</FONT><P ALIGN="CENTER">For the quarterly period ended June 28, 2001</P>
<P ALIGN="CENTER">OR</P>
<FONT SIZE=4><P ALIGN="CENTER">[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF</P>
<P ALIGN="CENTER">THE SECURITIES EXCHANGE ACT OF 1934</P>
</B></FONT><P>&nbsp;</P></DIR>
</DIR>
</DIR>

<B><P ALIGN="CENTER">For the transition period from _________________ to ______________________</P>
<P ALIGN="CENTER">Commission file number 1-8747</P><DIR>
<DIR>
<DIR>

<FONT SIZE=5><P ALIGN="CENTER">AMC ENTERTAINMENT INC.</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(Exact name of registrant as specified in its charter)</P></DIR>
</DIR>
</DIR>
</FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=676>
<TR><TD WIDTH="50%" VALIGN="TOP">
<P ALIGN="CENTER"><B>Delaware</B></TD>
<TD WIDTH="50%" VALIGN="TOP">
<B><P ALIGN="CENTER">43-1304369</B></TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(State or other jurisdiction of incorporation or organization)</FONT></TD>
<TD WIDTH="50%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(I.R.S. Employer Identification No.)</FONT></TD>
</TR>
</TABLE>
</CENTER></P>
<DIR>
<DIR>
<DIR>

<B><P ALIGN="CENTER">106 West 14th Street</P>
<P ALIGN="CENTER">P.O. Box 219615</P>
<P ALIGN="CENTER">Kansas City, Missouri&#9; 64121-9615</P>
</B><FONT SIZE=2><P ALIGN="CENTER">(Address of principal executive offices)&#9; (Zip Code)</P>
</FONT><B><P ALIGN="CENTER">(816) 221-4000</P>
</B><FONT SIZE=2><P ALIGN="CENTER">(Registrant's telephone number, including area code) </P>
</FONT><P ALIGN="JUSTIFY">Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.</P>
<P ALIGN="CENTER">Yes <U>x </U>No ____</P>
<P ALIGN="JUSTIFY">Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.</P></DIR>
</DIR>
</DIR>

<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=775>
<TR><TD WIDTH="52%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="48%" VALIGN="TOP" ROWSPAN=2>
<B><P>Number of Shares </P>
<U><P>Outstanding as of June 28, 2001</B></U></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<B><U><P>Title of Each Class of Common Stock</U>&#9;</B></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<P>Common Stock, 66 2/3 cents par value</TD>
<TD WIDTH="48%" VALIGN="TOP">
<P>19,427,098</TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<P>Class B Stock, 66 2/3 cents par value</TD>
<TD WIDTH="48%" VALIGN="TOP">
<P>4,041,993</TD>
</TR>
</TABLE>
<DIR>
<DIR>
<DIR>

<B><P ALIGN="CENTER">&nbsp;</P></DIR>
</DIR>
</DIR>

<P ALIGN="CENTER">AMC ENTERTAINMENT INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">INDEX</P>
</B><P>&lt;Table&gt;</P>
<P>&lt;Caption&gt;</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=690>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="17%" VALIGN="TOP">
<B><U><P>Page Number</B></U></TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<B><P ALIGN="CENTER">PART I - FINANCIAL INFORMATION</B></TD>
<TD WIDTH="17%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&lt;S&gt;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>&lt;C&gt;</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">&lt;C&gt;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>Item 1.</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Financial Statements</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Consolidated Statements of Operations</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">3</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Consolidated Balance Sheets</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">4</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Consolidated Statements of Cash Flows</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">5</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Notes to Consolidated Financial Statements</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">7</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>Item 2.</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Management's Discussion and Analysis</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>of Financial Condition and Results of Operations </TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">11</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP" HEIGHT=66>
<P>Item 3. </TD>
<TD WIDTH="70%" VALIGN="TOP" HEIGHT=66>
<P>Quantitative and Qualitative Disclosures About Market Risk</TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=66>
<P ALIGN="CENTER">18</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<B><P ALIGN="CENTER">PART II - OTHER INFORMATION</B></TD>
<TD WIDTH="17%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>Item 1.</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Legal Proceedings</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">18</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>Item 2.</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Changes in Securities and Use of Proceeds</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">19</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>Item 6.</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Exhibits and Reports on Form 8-K</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">20</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="70%" VALIGN="TOP">
<P>Signatures</TD>
<TD WIDTH="17%" VALIGN="TOP">
<P ALIGN="CENTER">23</TD>
</TR>
</TABLE>

<P ALIGN="JUSTIFY">&#9;&lt;/table&gt;</P>
<B><P>Item 1. Financial Statements.</P>
</B><P>&lt;Table&gt;</P>
<P>&lt;Caption&gt;</P>
<B><P ALIGN="CENTER">AMC ENTERTAINMENT INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">CONSOLIDATED STATEMENTS OF OPERATIONS</P>
<P ALIGN="CENTER">(in thousands, except per share data)</P>
</B><P>&#9;</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=728>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="CENTER">June 28, 2001</U></FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="CENTER">June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">(Unaudited)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Revenues</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Admissions</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$203,184</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$193,541</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Concessions</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">84,865</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">80,715</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Other theatre</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">12,905</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">9,827</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Other </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">8,531</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">7,161</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Total revenues</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">309,485</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">291,244</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Expenses</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Film exhibition costs</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">110,181</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">104,109</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Concession costs</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">10,725</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">12,217</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Theatre operating expense</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">79,396</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">75,809</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Rent</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">58,846</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">55,979</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Other</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">10,737</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">8,825</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>General and administrative</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">7,795</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">6,635</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Preopening expense</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,269</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">1,608</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Theatre and other closure expense</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">76</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">727</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Depreciation and amortization</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">23,298</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">26,378</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>(Gain) loss on disposition of assets</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">159</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">(1,640</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Total costs and expenses</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">302,482</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">290,647</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Operating income</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">7,003</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">597</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Other expense (income) </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Other expense</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">3,754</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Interest expense</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Corporate borrowings</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">11,899</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">16,248</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Capital and financing lease obligations</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">3,514</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">3,182</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2 HEIGHT=23>
<FONT SIZE=2><P>Investment income </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=23>
<U><FONT SIZE=2><P ALIGN="RIGHT">(282</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2 HEIGHT=23>
<U><FONT SIZE=2><P ALIGN="RIGHT">(1,100</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Loss before income taxes and cumulative effect of an accounting change </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(11,882)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">(17,733)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Income tax provision</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">-</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">(6,600</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Loss before cumulative effect of an accounting change</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(11,882)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">(11,133)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Cumulative effect of an accounting change </FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>(net of income tax benefit of $10,950)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">-</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">(15,760</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Net loss</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>(11,882</U>) </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (26,893</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Preferred dividends</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">2,398</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">-</U></FONT></TD>
</TR>
<TR><TD WIDTH="65%" VALIGN="TOP">
<FONT SIZE=2><P>Net loss for common shares</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U>(14,280</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (26,893</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Loss per common share before cumulative effect of an accounting change:</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Basic</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.61</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.47</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.61</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.47</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Net loss per common share:</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Basic</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.61</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (1.15</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.61</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (1.15</U>)</FONT></TD>
</TR>
</TABLE>

<P ALIGN="CENTER">See Notes to Consolidated Financial Statements.</P>
<P>&lt;/table&gt;</P>
<P>&lt;Table&gt;</P>
<P>&lt;Caption&gt;</P>
<B><P ALIGN="CENTER">AMC ENTERTAINMENT INC.</P>
<P ALIGN="CENTER">CONSOLIDATED BALANCE SHEETS</P>
<P ALIGN="CENTER">(in thousands, except share data) </P></B>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=687>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<P>&nbsp;</TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 28, 2001</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P>March 29, 2001</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<P>&nbsp;</TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>(Unaudited)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P ALIGN="CENTER">ASSETS</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Current assets: </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Cash and equivalents</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 25,647</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 34,075</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Receivables, net of allowance for doubtful accounts of $1,247</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>as of June 28, 2001 and $1,137 as of March 29, 2001</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">18,919</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">14,231</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Other current assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">45,541 </U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">45,075</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Total current assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">90,107</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">93,381</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Property, net</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">748,754</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">757,518</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Intangible assets, net</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">7,225</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">7,639</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3 HEIGHT=16>
<FONT SIZE=2><P>Deferred income taxes</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">135,491</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">135,491</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Other long-term assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">51,267</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">53,235</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Total assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>1,032,844</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>1,047,264</U></FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=5>
<B><FONT SIZE=2><P ALIGN="CENTER">LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)</B></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Current liabilities: </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Accounts payable</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$103,201</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 100,989</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Accrued expenses and other liabilities</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">138,349</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">138,193</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Current maturities of capital and financing </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>lease obligations</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">2,854</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">2,718</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Total current liabilities</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">244,404</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">241,900</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Corporate borrowings</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">457,190</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">694,172</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Capital and financing lease obligations </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">62,977</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">53,966</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Other long-term liabilities</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">111,070</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">116,271</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Total liabilities</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">875,641</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,106,309</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Commitments and contingencies</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Stockholders' equity (deficit): </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Series A Convertible Preferred Stock, 66 2/3 cents par value; 92,000 shares issued and outstanding as of June 28, 2001 (aggregate liquidation preference of $93,242 as of June 28, 2001)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">61</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Series B Exchangeable Preferred Stock, 66 2/3 cents par value; 158,000 shares issued and outstanding as of June 28, 2001 (aggregate liquidation preference of $161,792 as of June 28, 2001)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">106</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Common Stock, 66 2/3 cents par value; 19,447,598<U> </U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>shares issued as of June 28, 2001 and March 29, 2001</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">12,965</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">12,965</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Convertible Class B Stock, 66 2/3 cents par value; 4,041,993 shares</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>issued and outstanding as of June 28, 2001 and March 29, 2001</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">2,695</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">2,695</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Additional paid-in capital</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">336,517</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">106,713</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Accumulated other comprehensive income</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(16,829)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(15,121)</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP">
<FONT SIZE=2><P>Accumulated deficit</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" COLSPAN=3>
<U><FONT SIZE=2><P ALIGN="RIGHT">(167,929</U>)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(156,047</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<P>&nbsp;</TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">167,586</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(48,795)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Less:</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Employee notes for Common Stock purchases</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">10,014</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">9,881</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Common Stock in treasury, at cost, 20,500 shares as of </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>June 28, 2001 and March 29, 2001</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">369</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">369</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3 HEIGHT=24>
<FONT SIZE=2><P>Total stockholders' equity (deficit)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" HEIGHT=24>
<U><FONT SIZE=2><P ALIGN="RIGHT">157,203</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=24>
<U><FONT SIZE=2><P ALIGN="RIGHT">(59,045</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Total liabilities and stockholders' equity (deficit)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>1,032,844</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>1,047,264</U></FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P>See Notes to Consolidated Financial Statements.</P>
<P>&lt;/table&gt;</P>
<P>&lt;Table&gt;</P>
<P>&lt;Caption&gt;</P>
</FONT><B><P ALIGN="CENTER">AMC ENTERTAINMENT INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">CONSOLIDATED STATEMENTS OF CASH FLOWS</P>
<P ALIGN="CENTER">(in thousands, except per share data)</P></B>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=759>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="31%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 28, 2001</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>INCREASE (DECREASE) IN CASH AND EQUIVALENTS</B></FONT></TD>
<TD WIDTH="31%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">(Unaudited)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>Cash flows from operating activities:</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Net loss</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ (11,882)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ (26,893)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Adjustments to reconcile net loss to </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>net cash provided by operating activities:</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Depreciation and amortization</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">23,298</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">26,378</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Deferred income taxes</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(6,458)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Loss (gain) on disposition of long-term assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">159</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(1,640)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Cumulative effect of an accounting change</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">15,760</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Change in assets and liabilities:</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Receivables</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(2,110)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(933)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Other current assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(466)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">4,069</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Accounts payable</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">6,433</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">176 </FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Accrued expenses and other liabilities</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">5,118</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">10,407</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Liabilities for theatre closure </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(2,890)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(405)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Other, net</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">344</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">924</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Net cash provided by operating activities</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">18,004</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">21,385</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>Cash flows from investing activities:</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Capital expenditures</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(22,099)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(31,876)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Proceeds from sale/leasebacks</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">9,167</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">6</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Net proceeds (payments) on reimbursable construction advances</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(3,412)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">777</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Proceeds from disposition of long-term assets</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">940</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">26,134</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3 HEIGHT=25>
<FONT SIZE=2><P>Other, net</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" HEIGHT=25>
<U><FONT SIZE=2><P ALIGN="RIGHT">1,175</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=25>
<U><FONT SIZE=2><P ALIGN="RIGHT">(3,739</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Net cash used in investing activities</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">(14,229</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(8,698</U>) </FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>Cash flows from financing activities:</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Net proceeds from preferred stock issuance</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">229,874</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Net repayments under revolving Credit Facility</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(237,000)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(70,000)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Proceeds from sale/leasebacks</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">-</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">3,001</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Principal payments under capital and financing lease obligations</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(699)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(798)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Change in cash overdrafts</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(3,223)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(869)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Change in construction payables</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(998)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,233</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Deferred financing costs and other</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">40</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">-</U></FONT></TD>
</TR>
<TR><TD WIDTH="65%" VALIGN="TOP">
<FONT SIZE=2><P>Net cash used in financing activities</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" COLSPAN=3>
<U><FONT SIZE=2><P ALIGN="RIGHT">(12,006</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(67,433</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P>Effect of exchange rate changes on cash and equivalents</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(197</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(720</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>Net decrease in cash and equivalents</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(8,428</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(55,466</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>Cash and equivalents at beginning of period</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">34,075</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">119,305</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP" COLSPAN=3>
<B><FONT SIZE=2><P>Cash and equivalents at end of period</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> 25,647</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> 63,839</U></FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P>&lt;/table&gt;</P>
</FONT><P ALIGN="CENTER">&nbsp;</P>
<P>&lt;Table&gt;</P>
<FONT SIZE=2><P>&lt;Caption&gt;</P>
</FONT><B><P ALIGN="CENTER">AMC ENTERTAINMENT INC. AND SUBSIDIARIES </P>
<P ALIGN="CENTER">CONSOLIDATED STATEMENTS OF CASH FLOWS</P>
<P ALIGN="CENTER">(in thousands)</P></B>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=672>
<TR><TD WIDTH="67%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="33%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="CENTER">June 28, 2001</U></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="CENTER">June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="33%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">(Unaudited)</FONT></TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<B><FONT SIZE=2><P>SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION</B></FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<B><FONT SIZE=2><P>Cash paid during the period for:</B></FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<P>&lt;S&gt;</TD>
<TD WIDTH="15%" VALIGN="TOP">
<P>&lt;C&gt;</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>&lt;C&gt;</TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<FONT SIZE=2><P>Interest (net of amounts capitalized of $974 and $1,386)</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 7,420</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 11,132</FONT></TD>
</TR>
<TR><TD WIDTH="67%" VALIGN="TOP">
<FONT SIZE=2><P>Income taxes paid (refunded)</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">32</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(5,054)</FONT></TD>
</TR>
</TABLE>

<P>&#9;&#9;&#9;<FONT SIZE=2>&nbsp;</FONT>&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;<FONT SIZE=2>&nbsp;</FONT>&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;</P>
<P ALIGN="CENTER">See Notes to Consolidated Financial Statements.</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&lt;/table&gt;</P>
<B><P ALIGN="CENTER">AMC ENTERTAINMENT INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</P>
<P ALIGN="CENTER">JUNE 28, 2001</P>
<P ALIGN="CENTER">(Unaudited)</P>
<P ALIGN="CENTER">NOTE 1 - BASIS OF PRESENTATION</P>
</B><P ALIGN="JUSTIFY">&#9;AMC Entertainment Inc. ("AMCE") is a holding company which, through its direct and indirect subsidiaries, including American Multi-Cinema, Inc. ("AMC"), AMC Theatres of Canada (a division of AMC Entertainment International, Inc.), AMC Entertainment International, Inc., National Cinema Network, Inc. ("NCN") and AMC Realty, Inc. (collectively with AMCE, unless the context otherwise requires, the "Company"), is principally involved in the theatrical exhibition business throughout North America and in China (Hong Kong SAR), Japan, France, Portugal, Spain and Sweden. The Company's North American theatrical exhibition business is conducted through AMC and AMC Theatres of Canada. The Company's International theatrical exhibition business is conducted through AMC Entertainment International, Inc. The Company is also involved in the business of providing on-screen advertising and other services to AMC and other theatre circuits through a wholly-owned subsidiary, National Cinema Network, Inc., and in miscellaneous ventures through AMC Realty, Inc.</P>
<P ALIGN="JUSTIFY">&#9;The accompanying unaudited consolidated financial statements have been prepared in response to the requirements of Form 10-Q and should be read in conjunction with the Company's annual report on Form 10-K for the year (52 weeks) ended March 29, 2001. In the opinion of management, these interim financial statements reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the Company's financial position and results of operations. Due to the seasonal nature of the Company's business, results for the thirteen weeks ended June 28, 2001 are not necessarily indicative of the results to be expected for the fiscal year (52 weeks) ending March 28, 2002.</P>
<P ALIGN="JUSTIFY">&#9;The March 29, 2001 consolidated balance sheet data was derived from the audited balance sheet, but does not include all disclosures required by generally accepted accounting principles. </P>
<P ALIGN="JUSTIFY">&#9;Certain amounts have been reclassified from prior period consolidated financial statements to conform with the current year presentation. Prior period results of operations have been revised to reflect the adoption of Staff Accounting Bulletin No. 101 <I>Revenue Recognition in Financial Statements</I>.</P>
<B><P ALIGN="JUSTIFY">NOTE 2 - LOSS PER COMMON SHARE</P>
</B><P ALIGN="JUSTIFY">&#9;&#9;The following table sets forth the computation of basic and diluted loss per common share:</P>
<P>&lt;Table&gt;</P>
<FONT SIZE=2><P>&lt;Caption&gt;</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=745>
<TR><TD WIDTH="57%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="43%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="21%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 28, 2001</U></FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="43%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">(in thousands, except per share data)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Loss before cumulative effect of an accounting change</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ (11,882)</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ (11,133)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Less: Preferred dividends</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">2,398</U></FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">-</U></FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Net loss for common shares before cumulative effect of an accounting change for basic and diluted earnings per common share</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>(14,280</U>)</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (11,133</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Denominator:</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Shares for basic and diluted earnings per common share -</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>&nbsp;</TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Average shares outstanding</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">23,469</U></FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">23,469</U></FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Basic loss per common share before cumulative effect of an accounting change</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.61</U>)</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.47</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Diluted loss per common share before cumulative effect of an accounting change</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.61</U>)</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (.47</U>)</FONT></TD>
</TR>
</TABLE>

<P ALIGN="JUSTIFY">&lt;/table&gt;</P>
<P ALIGN="JUSTIFY">&#9;Shares from options to purchase shares of Common Stock were excluded from the diluted earnings per share calculation because they were anti-dilutive. During the thirteen weeks ended June 28, 2001, shares from options to purchase 235,178 shares of Common Stock and 10,293,706 shares of Common Stock from the assumed conversion of Series A Convertible Preferred Stock were excluded from the diluted earnings per common share calculation because they were anti-dilutive.</P>
<B><P>NOTE 3 - COMPREHENSIVE INCOME</P>
</B><P ALIGN="JUSTIFY">&#9;The components of comprehensive income are as follows:</P>
<P>&lt;Table&gt;</P>
<FONT SIZE=2><P>&lt;Caption&gt;</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=733>
<TR><TD WIDTH="70%" VALIGN="TOP">
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P>June 28, 2001</U></FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">(in thousands)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>Net loss</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ (11,882)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$ (26,893)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>Foreign currency translation adjustment</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(1,708)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">(1,038)</FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>Unrealized gain on marketable securities (net of income tax benefit of $99)</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">-</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">151</U></FONT></TD>
</TR>
<TR><TD WIDTH="70%" VALIGN="TOP">
<FONT SIZE=2><P>Comprehensive loss</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (13,590</U>)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> (27,780</U>)</FONT></TD>
</TR>
</TABLE>

<P>&lt;/table&gt;</P>
<B><P>NOTE 4 - OPERATING SEGMENTS</P>
</B><P>Information about the Company's operations by operating segment is as follows:</P>
<P>&lt;Table&gt;</P>
<P>&lt;Caption&gt;</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=696>
<TR><TD WIDTH="69%" VALIGN="TOP">
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="31%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P>June 28, 2001</U></FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<B><FONT SIZE=2><P>Revenues</B>&#9;&#9; </FONT></TD>
<TD WIDTH="31%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">(in thousands)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>North American theatrical exhibition</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$283,029 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$267,751</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>International theatrical exhibition</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">17,925</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">16,332</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>NCN and other</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">8,531</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">7,161</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Total revenues</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>309,485</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U>291,244</U></FONT></TD>
</TR>
</TABLE>

<B><FONT SIZE=2><P>Adjusted EBITDA </B><SUP>(1)</SUP>&#9;&#9;&#9;&#9;</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=696>
<TR><TD WIDTH="69%" VALIGN="TOP">
<P><FONT SIZE=2>North American theatrical exhibition</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$44,778</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$37,599</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>International theatrical exhibition</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(2,972)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">(1,630)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>NCN and other</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(2,206</U>) </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(1,664</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Total segment Adjusted EBITDA</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">39,600</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">34,305</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>General and administrative</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">7,795</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">6,635</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Total Adjusted EBITDA</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>31,805</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>27,670</U></FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P>&#9;&#9; </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=690>
<TR><TD WIDTH="69%" VALIGN="TOP">
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">June 28, 2001</U></FONT></TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">June 29, 2000</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<B><FONT SIZE=2><P>Property </B><SUP>(2)</SUP></FONT></TD>
<TD WIDTH="31%" VALIGN="TOP" COLSPAN=3>
<FONT SIZE=2><P ALIGN="CENTER">(in thousands)</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>North American theatrical exhibition</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$1,086,285</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$ 1,082,049 </FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>International theatrical exhibition</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">84,849</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">77,307</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>NCN and other</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">13,924</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">13,465</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Total segment property</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,185,058</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">1,172,821</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Construction in progress</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">26,305</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">39,889</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Corporate</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">31,278</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">45,882</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,242,641</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">1,258,592</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Less-accumulated depreciation</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>and amortization </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">493,887</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">429,711</U></FONT></TD>
</TR>
<TR><TD WIDTH="69%" VALIGN="TOP">
<FONT SIZE=2><P>Property, net</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U> 748,754</U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">$<U> 828,881</U></FONT></TD>
</TR>
</TABLE>
<DIR>

<SUP><P>(1)&#9;</SUP>Represents loss before cumulative effect of an accounting change plus interest, income taxes, depreciation and amortization, other expense and adjusted for preopening expense, theatre and other closure expense, (gain) loss on disposition of assets and equity in earnings of unconsolidated affiliates.</P>
<SUP><P>(2)</SUP> &#9;Property is comprised of land, buildings and improvements, leasehold improvements and furniture, fixtures and equipment.</P></DIR>

<P>&lt;/table&gt;</P>
<B><P>NOTE 5 - STOCKHOLDERS' EQUITY (DEFICIT)</P>
</B><P ALIGN="JUSTIFY">On April 19, 2001, the Company issued 92,000 shares of Series A Convertible Preferred Stock (the "Series A Preferred") and 158,000 shares of Series B Exchangeable Preferred Stock (the "Series B Preferred" and collectively with the Series A Preferred, the "Preferred Stock") at a price of $1,000 per share. Net proceeds from the issuance were used to repay borrowings under the Credit Facility. Reference is made to Note 5, Stockholders' Equity (Deficit), of the Company's Annual Report on Form 10-K for the fiscal year ended March 29, 2001 for additional information concerning the Preferred Stock.</P>
<P ALIGN="JUSTIFY">&#9;On July 25, 2001, holders of Convertible Class B Stock converted 100,000 shares of Class B Stock into 100,000 shares of Common Stock.</P>
<B><P>NOTE 6 - THEATRE AND OTHER CLOSURE AND DISPOSITION OF ASSETS</P>
<P>&#9;</B>A rollforward of reserves for theatre and other closure and the discontinuing operation of fast food restaurants is as follows:</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=516>
<TR><TD WIDTH="68%" VALIGN="TOP">
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>Thirteen Weeks Ended</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="CENTER">June 28, 2001</U></FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>Beginning Balance</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$32,092</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>Theatre and other closure expense</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">76</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>Interest expense</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,356</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>Transfer of deferred rent balances</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">308</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>Payments</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">(4,676</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="68%" VALIGN="TOP">
<FONT SIZE=2><P>Ending Balance</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>29,156</U></FONT></TD>
</TR>
</TABLE>

<B><P ALIGN="JUSTIFY">NOTE 7 - CONTINGENCIES </P>
</B><P ALIGN="JUSTIFY">&#9;The Company, in the normal course of business, is party to various legal actions. Except as described below, management believes that the potential exposure, if any, from such matters would not have a material adverse effect on the financial condition, cash flows or results of operations of the Company. </P>
<P ALIGN="JUSTIFY">&#9;The Company is the defendant in two coordinated cases now pending in California, <I>Weaver v. AMC Entertainment Inc.</I>, (filed March 2000 in Superior Court of California, San Francisco County), and <I>Geller v. AMC Entertainment Inc.</I> (filed May 2000 in Superior Court of California, San Bernardino County). The litigation is based upon California Civil Code Section 1749.5, which provides that "on or after July 1, 1997, it is unlawful for any person or entity to sell a gift certificate to a purchaser containing an expiration date." <I>Weaver</I> is a purported class action on behalf of all persons in California who, on or after January 1, 1997, purchased or received an AMC Gift of Entertainment ("GOE") containing an expiration date. <I>Geller</I> is brought by a plaintiff who allegedly received an AMC discount ticket in California containing an expiration date and who purports to represent all California purchasers of these "gift certificates" purchased from any AMC theatre, store, location, web-site or other venue owned or controlled by AMC since January 1, 1997. Both complaints allege unfair competition and seek injunctive relief. <I>Geller </I>seeks restitution of all expired "gift certificates" purchased in California since January 1, 1997 and not redeemed. <I>Weaver</I> seeks disgorgement of all revenues and profits obtained since January 1997 from sales of "gift certificates" containing an expiration date, as well as actual and punitive damages. The Company has denied any liability, answering that GOEs and discount tickets are not a "gift certificate" under the statute and that, in any event, no damages have occurred. On May 11, 2001, following a special trial on the issue, the court ruled that the GOEs and discount tickets are "gift certificates." The Company intends to appeal this ruling and to continue defending the cases vigorously. Should the result of this litigation ultimately be adverse to the Company, it is presently unable to estimate the amount of the potential loss.</P>
<B><P ALIGN="JUSTIFY">Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.</P>
</B><P ALIGN="JUSTIFY">This section contains certain "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by use of statements that include words or phrases such as the Company or its management "believes," "expects," "anticipates," "intends," "plans," "foresees" or other words or phrases of similar import. Similarly, statements that describe the Company's objectives, plans or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. Important factors that could cause actual results to differ materially from the expectations of the Company include, among others: (i) the Company's ability to enter into various financing programs; (ii) the performance of films licensed by the Company; (iii) competition; (iv) construction delays; (v) the ability to open or close theatres and screens as currently planned; (vi) general economic conditions, including adverse changes in inflation and prevailing interest rates; (vii) demographic changes; (viii) increases in the demand for real estate; (ix) changes in real estate, zoning and tax laws and (x) unforeseen changes in operating requirements. Readers are urged to consider these factors carefully in evaluating the forward-looking statements. The forward-looking statements included herein are made only as of the date of this Form 10-Q and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances. </P>
<B><P>&nbsp;Operating Results</P>
</B><P ALIGN="JUSTIFY">&#9;Set forth in the table below is a summary of revenues, costs and expenses attributable to the Company's North American and International theatrical exhibition operations and NCN and other businesses.</P>
<P>&nbsp;</P>
<P>&lt;Table&gt;</P>
<P>&lt;Caption&gt; &#9; </P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=762>
<TR><TD WIDTH="38%" VALIGN="TOP">
<P><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="38%" VALIGN="TOP" COLSPAN=4>
<FONT SIZE=2><P>Thirteen Weeks Ended&#9;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P>June 28, 2001</U></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P>June 29, 2000</U></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP">
<U><FONT SIZE=2><P>% Change</U></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">(Dollars in thousands)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;S&gt;</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&lt;C&gt;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<B><FONT SIZE=2><P>Revenues</B></FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>North American theatrical exhibition</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Admissions</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$188,803</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$180,377</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">4.7%</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Concessions</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">81,833</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">78,023</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">4.9</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Other theatre</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">12,393</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">9,351</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">32.5</U></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=28><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2 HEIGHT=28><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT">283,029</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT">267,751</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT">5.7</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>International theatrical exhibition </FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Admissions</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">14,381</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">13,164</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">9.2</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Concessions</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">3,032</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">2,692</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">12.6</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Other theatre</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">512</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">476</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">7.6</U></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=29><P></P></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2 HEIGHT=29><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=29>
<FONT SIZE=2><P ALIGN="RIGHT">17,925<U> </U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=29>
<FONT SIZE=2><P ALIGN="RIGHT">16,332</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=29>
<FONT SIZE=2><P ALIGN="RIGHT">9.8</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=34>
<FONT SIZE=2><P>NCN and other</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2 HEIGHT=34><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=34>
<U><FONT SIZE=2><P ALIGN="RIGHT">8,531</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=34>
<U><FONT SIZE=2><P ALIGN="RIGHT">7,161</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=34>
<U><FONT SIZE=2><P ALIGN="RIGHT">19.1</U></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=28>
<FONT SIZE=2><P>Total revenues</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2 HEIGHT=28><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT">$<U>309,485</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT">$<U>291,244</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=28>
<U><FONT SIZE=2><P ALIGN="RIGHT">6.3</U>%</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<B><FONT SIZE=2><P>Cost of Operations</B></FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>North American theatrical exhibition </FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Film exhibition costs</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$102,956</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$ 97,328</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">5.8%</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Concession costs</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">9,766</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">11,416</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">(14.5)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Theatre operating expense</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">73,992</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">70,642</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">4.7</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Rent</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">52,034</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">50,766</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">2.5</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Preopening expense</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,261</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">1,342</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">(6.0)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Theatre and other closure expense</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">76</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<U><FONT SIZE=2><P ALIGN="RIGHT">727</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">(89.5</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=29><P></P></TD>
<TD WIDTH="21%" VALIGN="TOP" HEIGHT=29><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" COLSPAN=2 HEIGHT=29>
<FONT SIZE=2><P ALIGN="RIGHT">240,085</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=29>
<FONT SIZE=2><P ALIGN="RIGHT">232,221</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=29>
<FONT SIZE=2><P ALIGN="RIGHT">3.4</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>International theatrical exhibition</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Film exhibition costs</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">7,225</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">6,781</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">6.5</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Concession costs</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">959</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">801</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">19.7</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Theatre operating expense</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">5,404</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">5,167</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">4.6</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Rent</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">6,812</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">5,213</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">30.7</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=27>
<FONT SIZE=2><P>Preopening expense</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2 HEIGHT=27><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=27>
<U><FONT SIZE=2><P ALIGN="RIGHT">8</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=27>
<U><FONT SIZE=2><P ALIGN="RIGHT">266</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=27>
<U><FONT SIZE=2><P ALIGN="RIGHT">(97.0</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">20,408</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">18,228</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">12.0</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>NCN and other</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">10,737</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">8,825</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">21.7</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>General and administrative</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">7,795</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">6,635</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">17.5</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Depreciation and amortization</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">23,298</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">26,378</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="RIGHT">(11.7)</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP" HEIGHT=34>
<FONT SIZE=2><P>(Gain) loss on disposition of assets</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2 HEIGHT=34><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" HEIGHT=34>
<U><FONT SIZE=2><P ALIGN="RIGHT">159</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=34>
<U><FONT SIZE=2><P ALIGN="RIGHT">(1,640</U>)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2 HEIGHT=34>
<U><FONT SIZE=2><P ALIGN="RIGHT">*</U></FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Total costs and expenses</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>302,482</U></FONT></TD>
<TD WIDTH="11%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="RIGHT">$<U>290,647</U></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" COLSPAN=2>
<U><FONT SIZE=2><P ALIGN="RIGHT">4.1</U>%</FONT></TD>
</TR>
</TABLE>

<P>*Percentage change in excess of 100%.</P>
<P>&lt;/table&gt;</P>
<B><P>Thirteen weeks ended June 28, 2001 and June 29, 2000.</P>
<I><P ALIGN="JUSTIFY">&#9;</I>Revenues.</B> Total revenues increased 6.3% during the thirteen weeks ended June 28, 2001 compared to the thirteen weeks ended June 29, 2000. </P>
<P ALIGN="JUSTIFY">&#9;North American theatrical exhibition revenues increased 5.7% from the prior year. Admissions revenues increased 4.7% due to a 5.1% increase in average ticket price offset by a 0.4% decrease in attendance. The increase in average ticket prices was due primarily to a strategic initiative implemented by the Company during fiscal 2001 and 2002 to selectively increase ticket prices. Attendance decreased due to the closure or sale of 38 theatres with 256 screens since June 29, 2000, offset by attendance increases from 6 new theatres with 116 screens added since June 29, 2000. Attendance at comparable theatres (theatres opened before fiscal 2001) was essentially unchanged. Concessions revenues increased 4.9% due to a 5.3% increase in average concessions per patron. The increase in average concessions per patron was attributable primarily to the increased attendance at children's films where concession spending per patron is generally higher. </P>
<P ALIGN="JUSTIFY">International theatrical exhibition revenues increased 9.8% from the prior year. Admissions revenues increased 9.2% due to an increase in attendance from the addition of 2 new theatres with a total of 34 screens since June 29, 2000. Attendance at comparable theatres increased 2.4%. Concession revenues increased 12.6% due primarily to the increase in total attendance. International revenues were negatively impacted by a stronger U.S. dollar, although this did not contribute materially to consolidated net loss. </P>
<P ALIGN="JUSTIFY">&#9;Revenues from NCN and other increased 19.1% from the prior year due to an increase in advertising revenues at NCN.</P>
<B><I><P ALIGN="JUSTIFY">&#9;</I>Costs and expenses</B>. Total costs and expenses increased 4.1% during the thirteen weeks ended June 28, 2001 compared to the thirteen weeks ended June 29, 2000.&#9;</P>
<P ALIGN="JUSTIFY">&#9;</P>
<P ALIGN="JUSTIFY">North American theatrical exhibition costs and expenses increased 3.4% from the prior year. Film exhibition costs increased 5.8% due to higher admissions revenues and an increase in the percentage of admissions paid to film distributors. As a percentage of admissions revenues, film exhibition costs were 54.5% in the current year as compared with 54.0% in the prior year. Concession costs decreased 14.5% due to additional marketing incentives from vendors under renegotiated contract terms and the Company's initiative to consolidate purchasing to obtain more favorable pricing, offset by an increase in concession sales. As a percentage of concessions revenues, concession costs were 11.9% in the current year compared with 14.6% in the prior year. As a percentage of revenues, theatre operating expense was 26.1% in the current year as compared to 26.4% in the prior year. Rent expense increased 2.5% due to the growing number of megaplexes (theatres with predominantly stadium seating) in the Company's theatre circuit, which generally have higher rent per screen than multiplexes (theatres generally without stadium seating). During the thirteen weeks, the Company incurred $76,000 of theatre and other closure expenses, primarily comprised of expected payments to landlords to terminate leases related to the closure of 3 multiplexes with 18 screens offset by a favorable renegotiation of vacant restaurant space related to a terminated joint venture. The Company closed these theatres as a result of negative operating cash flows which were not expected to improve in the future. The Company anticipates that it will incur approximately $5,000,000 of costs related to the closure of approximately 83 multiplex screens in fiscal 2002. </P>
<P ALIGN="JUSTIFY">&#9;International theatrical exhibition costs and expenses increased 12.0% from the prior year. Film exhibition costs increased 6.5% primarily due to higher admissions revenues. Rent expense increased 30.7% and theatre operating expense increased 4.6% from the prior year, due to the increased number of screens in operation. International theatrical exhibition costs and expenses were positively impacted by a stronger U.S. dollar, although this did not contribute materially to consolidated net loss.</P>
<P ALIGN="JUSTIFY">&#9;Costs and expenses from NCN and other increased 21.7% due primarily to an increase in expenses at NCN. </P>
<P ALIGN="JUSTIFY">&#9;General and administrative expenses increased 17.5% from the prior year due primarily to an increase in incentive compensation expense. As a percentage of total revenues, general and administrative expenses increased from 2.3% in the prior year to 2.5% in the current year. </P>
<B><P ALIGN="JUSTIFY">&#9;</B>Depreciation and amortization decreased 11.7%, or $3,080,000, during the thirteen weeks ended June 28, 2001. The decrease was primarily caused by a decrease in depreciation of $2,229,000 related to impairment losses recorded in previous periods which reduced the carrying value of theatre assets.</P>
<B><I><P ALIGN="JUSTIFY">&#9;</B></I>Gain on disposition of assets decreased from a gain of $1,640,000 in the prior year to a loss of $159,000 during the current year. Current year and prior year results include the sale of real estate held for investment. </P>
<P ALIGN="JUSTIFY">&#9;<B>Other Expense<I>. </B></I>During the thirteen weeks ended June 28, 2001, the Company recognized $3,754,000 of transaction expenses incurred in connection with the issuance of Preferred Stock. </P>
<B><I><P ALIGN="JUSTIFY">&#9;</I>Interest Expense.</B> Interest expense decreased 20.7% during the thirteen weeks ended June 28, 2001 compared to the prior year, due to a decrease in average outstanding borrowings from net proceeds on the sale of Preferred Stock. </P>
<B><I><P ALIGN="JUSTIFY">&#9;</I>Income Tax Provision.</B> The provision for income taxes was $0 during the current year compared to a benefit of $6,600,000 in the prior year. The effective tax rate was 0% for the current year compared to 37.2% for the previous year. The Company adjusts its expected annual tax rate on a quarterly basis based on current projections of non-deductible expenses and pre-tax earnings or losses for its domestic and foreign subsidiaries.</P>
<B><P ALIGN="JUSTIFY">&#9;Net Loss.</B> Net loss decreased during the thirteen weeks ended June 28, 2001 to a loss of $11,882,000 from a loss of $26,893,000 in the prior year due primarily to the cumulative effect of an accounting change recorded in the prior year. Net loss per common share was $.61 compared to a loss of $1.15 in the prior year. Prior year results include the cumulative effect of an accounting change of $15,760,000 (net of income tax benefit of $10,950,000), which increased loss per share by $.68 for the thirteen weeks ended June 29, 2000.</P>
<B><P ALIGN="JUSTIFY">LIQUIDITY AND CAPITAL RESOURCES </P>
</B><P ALIGN="JUSTIFY">&#9;The Company's revenues are collected in cash, principally through box office admissions and theatre concessions sales. The Company has an operating "float" which partially finances its operations and which generally permits the Company to maintain a smaller amount of working capital capacity. This float exists because admissions revenues are received in cash, while exhibition costs (primarily film rentals) are ordinarily paid to distributors from 30 to 45 days following receipt of box office admissions revenues. The Company is only occasionally required to make advance or early payments or non-refundable guaranties of film rentals. Film distributors generally release during the summer and holiday seasons the films which they anticipate will be the most successful. Consequently, the Company typically generates higher revenues during such periods. </P>
<P ALIGN="JUSTIFY">&#9;Cash flows from operating activities, as reflected in the Consolidated Statements of Cash Flows, declined $3,381,000 from $21,385,000 during the thirteen weeks ended June 29, 2000 to $18,004,000 during the thirteen weeks ended June 28, 2001. The decrease in operating cash flows for the thirteen weeks ended June 29, 2000 to June 28, 2001 is primarily due to an increase in incentive compensation payments, a decrease in tax refunds, increases in Preferred Stock transaction payments, and increases in theatre closure payments offset by decreases in payments on accounts payable, increased adjusted EBITDA and decreased interest payments. The Company had a net working capital deficit as of June 28, 2001 and March 29, 2001 of $154,297,000 and $148,519,000, respectively. The increase in working capital deficit is not expected to negatively impact the Company's ability to fund operations or planned capital expenditures for the next 12 months. The Company borrows against its Credit Facility to meet obligations as they come due and had approximately $334,000,000 and $150,000,000 available on its Credit Facility to meet these obligations as of June 28, 2001 and March 29, 2001, respectively. </P>
<P ALIGN="JUSTIFY">&#9;The Company continues to expand its North American and International theatre circuits. During the current fiscal year, the Company opened 3 theatres with 60 screens. In addition, the Company closed 3 theatres with 18 screens resulting in a circuit total of 180 theatres with 2,810 screens as of June 28, 2001. </P>
<P ALIGN="JUSTIFY">&#9;The costs of constructing new theatres are funded by the Company through internally generated cash flow or borrowed funds. The Company generally leases its theatres pursuant to long-term non-cancelable operating leases which require the developer, who owns the property, to reimburse the Company for a portion of the construction costs. However, the Company may decide to own the real estate assets of new theatres and, following construction, sell and leaseback the real estate assets pursuant to long-term non-cancelable operating leases. During the thirteen weeks ended June 28, 2001, the Company leased 3 new theatres with 60 screens from developers. The Company also sold and subsequently leased back the land at one of its megaplex theatres to Entertainment Properties Trust ("EPT"), a real estate investment trust, for approximately $7,500,000. </P>
<P ALIGN="JUSTIFY">&#9;Until November 2002, EPT has a right of first refusal and first offer to purchase and leaseback to the Company the real estate assets associated with any megaplex theatre and related entertainment property owned or ground-leased by the Company, exercisable upon the Company's intended disposition of such property. As of June 28, 2001, the Company had 4 open megaplexes that would be subject to EPT's right of first refusal and first offer to purchase should the Company seek to dispose of such megaplexes. </P>
<P ALIGN="JUSTIFY">&#9;Historically, the Company has owned and paid for the equipment necessary to fixture a theatre. However, the Company may enter into lease agreements for equipment necessary to fixture certain theatres. &#9;</P>
<P ALIGN="JUSTIFY">&#9;As of June 28, 2001, the Company had construction in progress of $26,305,000 and reimbursable construction advances (amounts due from developers on leased theatres) of $3,421,000. The Company had four theatres in the U.S. with a total of 70 screens, one theatre in the United Kingdom with 16 screens and two theatres in Spain with 38 screens under construction on June 28, 2001. During the thirteen weeks ended June 28, 2001, the Company had capital expenditures of $22,099,000. The Company expects that the net cash requirements for capital expenditures will approximate $75,000,000 in fiscal 2002.</P>
<P ALIGN="JUSTIFY">&#9;The Company's Credit Facility permits borrowings at interest rates based on either the bank's base rate or LIBOR and requires an annual commitment fee based on margin ratios that could result in a rate of .375% or .500% on the unused portion of the commitment. The Credit Facility matures on April 10, 2004. The commitment thereunder will be reduced by $25,000,000 on each of December 31, 2002, March 31, 2003, June 30, 2003 and September 30, 2003 and by $50,000,000 on December 31, 2003. The total commitment under the Credit Facility is $425,000,000, but the facility contains covenants that limit the Company's ability to incur debt (whether under the Credit Facility or from other sources). As of June 28, 2001, the Company had outstanding borrowings of $33,000,000 under the Credit Facility at an average interest rate of 6.7% per annum, and approximately $334,000,000 was available for borrowing under the Credit Facility. </P>
<P ALIGN="JUSTIFY">&#9;Covenants under the Credit Facility impose limitations on indebtedness, creation of liens, change of control, transactions with affiliates, mergers, investments, guaranties, asset sales, dividends, business activities and pledges. In addition, the Credit Facility contains certain financial covenants. Covenants under the Indentures relating to the Company's $225,000,000 aggregate principal amount of 9 1/2% Senior Subordinated Notes due 2011 (the "Notes due 2011") and $200,000,000 aggregate principal amount of 9 1/2% Senior Subordinated Notes due 2009 (the "Notes due 2009") are substantially the same and impose limitations on the incurrence of indebtedness, dividends, purchases or redemptions of stock, transactions with affiliates, and mergers and sales of assets, and require the Company to make an offer to purchase the Notes upon the occurrence of a change in control, as defined in the Indentures. Upon a change of control, the Company will be required to make an offer to repurchase each holder's Notes due 2009 and Notes due 2011 at a price equal to 101% of the principal amount thereof plus accrued and unpaid interest to the date of repurchase. </P>
<P ALIGN="JUSTIFY">&#9;The Indentures relating to the Notes due 2009 and 2011 (collectively, the "Notes") also contain provisions subordinating the obligations of the Company under the Notes to its obligations under the Credit Facility and other senior indebtedness. These include a provision that applies if there is a payment default under the Credit Facility or other senior indebtedness and one that applies if there is a non-payment default that permits acceleration of indebtedness under the Credit Facility. If there is a payment default under the Credit Facility or other senior indebtedness, generally no payment may be made on the Notes until such payment default has been cured or waived or such senior indebtedness had been discharged or paid in full. If there is a non-payment default under the Credit Facility that would permit the lenders to accelerate the maturity date of the Credit Facility, no payment may be made on the Notes for a period (the "Payment Blockage Period") commencing upon the receipt by the Indenture trustees for the Notes of notice of such default and ending up to 179 days thereafter. Not more than one Payment Blockage Period may be commenced during any period of 365 consecutive days. Failure of the Company to make payment on either series of Notes when due or within any applicable grace period, whether or not occurring under a Payment Blockage Period, will be an event of default with respect to such Notes. As of June 28, 2001, the Company was in compliance with all financial covenants relating to the Credit Facility, the Notes due 2009 and the Notes due 2011. However, as of such date, under provisions of the Indentures related to the Notes due 2009, the Company is prohibited from incurring additional indebtedness, other than additional borrowings under the Credit Facility and other permitted indebtedness, as defined in the Indentures, and paying cash dividends or making distributions in respect of its capital stock.</P>
<P ALIGN="JUSTIFY">&#9;On April 19, 2001, the Company issued shares of Series A Preferred Stock and Series B Preferred Stock for an aggregate purchase price of $250,000,000. Net proceeds from the sale (including transaction expenses) of approximately $225,000,000 were used to reduce outstanding indebtedness under the Company's Credit Facility. As described in Note 5 to the Company's Notes to Consolidated Financial Statements included in Part I Item 8. of its Form 10-K for the year ended March 29, 2001, dividends on the Preferred Stock are payable in additional shares of Preferred Stock until April 2004. Thereafter, at the Company's option, dividends on Series B Preferred Stock may be paid in additional shares of Series B Preferred Stock until April 2006 and dividends on Series A Preferred Stock may be paid in additional shares of Series A Preferred Stock until April 2008. Reference is made to such Note 5 for information describing circumstances in which holders of Preferred Stock may be entitled to special in-kind dividends and other circumstances under which holders of Preferred Stock may be required to receive payments-in-kind in lieu of cash and shares of Series B Preferred Stock instead of Series A Preferred Stock. Reference is also made to such Note 5 for information relating to conversion rights, exchange obligations, the Company's redemption option, the holders' redemption option, voting rights, election of directors and liquidation preferences of the Preferred Stock.</P>
<P ALIGN="JUSTIFY">&#9;The Company believes that cash generated from operations, existing cash and equivalents, expected reimbursements from developers and the available commitment amount under its Credit Facility will be sufficient to fund operations, including amounts due under credit agreements, and planned capital expenditures for the next 12 months and enable the Company to maintain compliance with covenants related to the Credit Facility and the Notes. However, the performance of films licensed by the Company and unforeseen changes in operating requirements could affect the Company's ability to continue its business strategy as well as comply with certain financial covenants. </P>
<B><P ALIGN="JUSTIFY">Euro Conversion</P>
</B><P ALIGN="JUSTIFY">&#9;In January 1999, certain member countries of the European Union established irrevocable, fixed conversion rates between their existing currencies and the European Union's common currency (the "Euro"). The introduction of the Euro is scheduled to be phased in over a period ending January 1, 2002, when Euro notes and coins will come into circulation. The existing currencies are due to be completely removed from circulation on February 28, 2002.</P>
<P ALIGN="JUSTIFY">&#9;The Company currently operates one theatre in France, one theatre in Portugal and two theatres in Spain. These countries are member countries that adopted the Euro as of January 1, 1999. The Company is implementing necessary changes to accounting, operational, and payment systems to accommodate the introduction of the Euro. The Company does not anticipate that the conversion will have a material impact on its consolidated financial position, results of operations or cash flows.</P>
<B><P ALIGN="JUSTIFY">Item 3. Quantitative and Qualitative Disclosures About Market Risk.</P>
</B><P ALIGN="JUSTIFY">&#9;The Company is exposed to various market risks including interest rate risk and foreign currency exchange rate risk. The Company does not hold any derivative financial instruments.</P>
<B><P ALIGN="JUSTIFY">&#9;Market risk on variable rate financial instruments</B>. The Company maintains a $425 million credit facility (the "Credit Facility"), which permits borrowings at interest rates based on either the bank's base rate or LIBOR. Increases in market interest rates would cause interest expense to increase and earnings before income taxes to decrease. The change in interest expense and earnings before income taxes would be dependent upon the weighted average outstanding borrowings during the reporting period following an increase in market interest rates. Based on the Company's current outstanding borrowings under the Credit Facility at an average interest rate of 6.7% per annum, a 100 basis point increase in market interest rates would increase interest expense and decrease earnings before income taxes by approximately $330,000. </P>
<B><P ALIGN="JUSTIFY">&#9;Market risk on fixed-rate financial instruments. </B>Included in long-term debt are $200 million of 9 1/2% Senior Subordinated Notes due 2009 and $225 million of 9 1/2% Senior Subordinated Notes due 2011. Increases in market interest rates would generally cause a decrease in the fair value of the Notes due 2009 and the Notes due 2011 and a decrease in market interest rates would generally cause an increase in fair value of the Notes due 2009 and the Notes due 2011.</P>
<B><P ALIGN="JUSTIFY">&#9;Foreign currency exchange rates</B>.<I> </I>The Company currently operates theatres in China (Hong Kong SAR), Japan, France, Portugal, Spain, Sweden and Canada and is currently developing theatres in other international markets. As a result of these operations, the Company has assets, liabilities, revenues and expenses denominated in foreign currencies. The strengthening of the U.S. dollar against the respective currencies causes a decrease in the carrying values of assets, liabilities, revenues and expenses denominated in such foreign currencies and the weakening of the U.S. dollar against the respective currencies causes an increase in the carrying values of these items. The increases and decreases in assets, liabilities, revenues and expenses are included in accumulated other comprehensive income. Changes in foreign currency exchange rates also impact the comparability of earnings in these countries on a year-to-year basis. As the U.S. dollar strengthens, comparative translated earnings decrease, and as the U.S. dollar weakens, comparative translated earnings from foreign operations increase. Although the Company does not currently hedge against foreign currency exchange rate risk, it does not intend to repatriate funds from the operations of its international theatres but instead intends to use them to fund additional expansion. A 10% fluctuation in the value of the U.S. dollar against all foreign currencies of countries where the Company currently operates theatres would either increase or decrease earnings before income taxes and accumulated other comprehensive income by approximately $1.0 million and $10.8 million, respectively.</P>
<B><P ALIGN="CENTER">PART II - OTHER INFORMATION </P>
<P ALIGN="JUSTIFY">Item 1. Legal Proceedings. </P>
</B><P ALIGN="JUSTIFY">&#9;Reference is made to Item 3. Legal Proceedings of the Company's Annual Report on Form 10-K for the fiscal year ended March 29, 2001 for information on certain litigation to which the Company is a party.</P>
<P ALIGN="JUSTIFY">&#9;The Company is a party to various other legal proceedings in the ordinary course of business, none of which is expected to have a material adverse effect on the Company.<B> </P>
<P ALIGN="JUSTIFY">Item 2. Changes in Securities and Use of Proceeds.</P>
</B><P ALIGN="JUSTIFY">As previously reported, on April 19, 2001, the Company entered into an Investment Agreement with Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, Apollo Overseas Partners V, L.P. (collectively, with any other partnership or entity affiliated with and managed by Apollo over which Apollo exercises investment authority, the "Apollo Purchasers"), Apollo Management IV, L.P., and Apollo Management V, L.P. (together with their affiliates, "Apollo"). Pursuant to the Investment Agreement, the Company sold the Apollo Purchasers 92,000 shares of Series A Convertible Preferred Stock (<FONT FACE="WP TypographicSymbols">A</FONT>Series A Preferred Stock<FONT FACE="WP TypographicSymbols">@</FONT>) and 158,000 shares of Series B Exchangeable Preferred Stock (<FONT FACE="WP TypographicSymbols">A</FONT>Series B Preferred Stock<FONT FACE="WP TypographicSymbols">@</FONT>, and together with the Series A Preferred Stock, the <FONT FACE="WP TypographicSymbols">A</FONT>Preferred Stock<FONT FACE="WP TypographicSymbols">@</FONT>). The sale of the Preferred Stock has been reported previously in the Company's Form 8-K dated May 7, 2001 and Form 10-K for the fiscal year ended March 29, 2001.</P>
<P ALIGN="JUSTIFY">Subsequently, on July 3, 2001, the Apollo Purchasers sold 5,520 shares of Series A Preferred Stock and 9,480 shares of Series B Preferred Stock to a group of investment entities (the <FONT FACE="WP TypographicSymbols">A</FONT>Sandler Funds<FONT FACE="WP TypographicSymbols">@</FONT>) affiliated with Sandler Capital Management. The sale was a negotiated transaction exempt from registration under Section 4 of the Securities Act of 1933, as amended. Each of the Sandler Funds represented that it was an accredited investor and was acquiring the shares of Preferred Stock for investment and not with a view to or for sale in connection with any distribution thereof. The Sandler Funds are subject to the same restrictions regulating the conversion of Series A Preferred Stock and the transfer of Series B Preferred Stock as apply to the Apollo Purchasers.</P>
<P ALIGN="JUSTIFY">The rights of holders of Common Stock and Class B Stock may have been affected by the issuance of the Preferred Stock in the following respects.</P>
<P ALIGN="JUSTIFY">The Preferred Stock is senior to the Company's Common Stock and Class B Stock with respect to dividend rights and rights upon the liquidation, winding up or dissolution of the Company. Unless and until full cumulative dividends on the Preferred Stock in respect of all past quarterly dividends have been paid, and the full amount of dividends on shares of Preferred Stock in respect of the current quarterly dividend have been paid or are contemporaneously declared and set aside, no cash dividends may be paid or declared on shares of Common Stock or Class B Stock and no shares of Common Stock or Class B Stock may be purchased by the Company.</P>
<P ALIGN="JUSTIFY">Further, until such time as the Apollo Purchasers no longer beneficially own 50% of the aggregate number of shares of Preferred Stock issued pursuant to the Investment Agreement (reduced by the shares sold on July 3, 2001 to the Sandler Funds) or either Apollo is terminated as investment manager of the Apollo Purchasers or an Apollo affiliate is removed as the general partner of the Apollo Purchasers and, in either case, is not replaced by another Apollo affiliate, Apollo's approval is required with respect to the payment of cash dividends and certain other corporate actions, including, generally, amending the Company's Amended and Restated Certificate of Incorporation or bylaws, creating, issuing or purchasing capital stock, prepaying indebtedness, incurring indebtedness, engaging in mergers with other companies, engaging in certain affiliate transactions, changing the size of the Board of Directors or acquiring significant assets.</P>
<P ALIGN="JUSTIFY">Upon transfer of Series A Preferred Stock shares to a transferee that is not an affiliate of an Apollo Purchaser, the transferee holder of Series A Preferred Stock is entitled to vote on an as-converted basis with the holders of Common Stock and Class B Stock on all matters except the election of directors and any matter reserved by law or the Company's Amended and Restated Certificate of Incorporation for consideration exclusively by the holders of Common Stock or Class B Stock.</P>
<P ALIGN="JUSTIFY">Reference is made to the Company's Form 8-K dated May 7, 2001 and Form 10-K for the fiscal year ended March 29, 2001 for additional information relating to the Preferred Stock. </P>
<B><P ALIGN="JUSTIFY">Item 6. Exhibits and Reports on Form 8-K.</P>
<OL TYPE="a">

</B><P ALIGN="JUSTIFY"><LI>Exhibits</LI></P></OL>

<P ALIGN="JUSTIFY">&#9;&#9;&#9;</P>
<B><P ALIGN="CENTER">EXHIBIT INDEX</P>
<U><P ALIGN="JUSTIFY">EXHIBIT NUMBER</U>&#9;<U>DESCRIPTION</P></B></U>
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<TR><TD WIDTH="13%" VALIGN="TOP">
<P>3.1</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P>Amended and Restated Certificate of Incorporation of AMC Entertainment Inc. (as amended on December 2, 1997) (Incorporated by reference from Exhibit 3.1 to AMCE's Form 10-K (File No. 1-8747) dated March 29, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>3.2</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Bylaws of AMC Entertainment Inc. (Incorporated by reference from Exhibit 3.2 to AMCE's Form 10-K (File No. 1-8747) dated March 29, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>4.1</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Fifth Amendment, dated April 10, 2001, to Amended and Restated Credit Agreement dated as of April 10, 1997. (Incorporated by reference from Exhibit 4.1(e) to the Company's Form 8-K (File No. 1-8747) dated May 7, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>4.2</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P>Certificate of Designations of Series A Convertible Preferred Stock and Series B Exchangeable Preferred Stock of AMC Entertainment Inc. (Incorporated by reference from Exhibit 4.6 to the Company's Form 8-K (File No. 1-8747) filed on April 20, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>4.3</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Investment Agreement entered into April 19, 2001 by and among AMC Entertainment Inc. and Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P., Apollo Management IV, L.P. and Apollo Management V, L.P. (Incorporated by reference from Exhibit 4.7 to the Company's Form 8-K (File No. 1-8747) filed on April 20, 2001).</TD>
</TR>
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<P>4.4</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Standstill Agreement by and among AMC Entertainment Inc., and Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P., Apollo Mangement IV, L.P. and Apollo Management V, L.P., dated as of April 19, 2001. (Incorporated by reference from Exhibit 4.8 to the Company's Form 8-K (File No. 1-8747) filed on April 20, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>4.5</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Registration Rights Agreement dated April 19, 2001 by and among AMC Entertainment Inc. and Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P. (Incorporated by reference from Exhibit 4.9 to the Company's Form 8-K (File No. 1-8747) filed on April 20, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>*4.6</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P>Securities Purchase Agreement dated June 29, 2001 by and among Apollo Investment Fund IV, L.P., Apollo Overseas Partners IV, L.P., Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P., Apollo Management IV, L.P., Apollo Management V, L.P., AMC Entertainment Inc., Sandler Capital Partners V, L.P., Sandler Capital Partners V FTE, L.P. and Sandler Capital Partners V Germany, L.P.</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>10.1</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Employment agreement between AMC Entertainment Inc., American Multi-Cinema,&nbsp;Inc. and Philip M. Singleton which commenced on July 1, 2001. (Incorporated by reference from Exhibit 10.6 to the Company's Form 10-K/A (File No. 1-8747) filed on July 27, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>10.2</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Employment Agreement between AMC Entertainment Inc. and Peter C. Brown which commenced on July 1, 2001. (Incorporated by reference from Exhibit 10.7 to the Company's Form 10-K/A (File No. 1-8747) filed on July 27, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>10.3</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Employment agreement between AMC Entertainment Inc., American Multi-Cinema, Inc. and Richard M. Fay which commenced on July 1, 2001. (Incorporated by reference from Exhibit 10.15 to the Company's Form 10-K/A (File No. 1-8747) filed on July 27, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>10.4</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Employment agreement between AMC Entertainment Inc., American Multi-Cinema, Inc. and Richard T. Walsh which commenced July 1, 2001. (Incorporated by reference from Exhibit 10.25 to the Company's Form 10-K/A (File No. 1-8747) filed on July 27, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>10.5</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P ALIGN="JUSTIFY">Retainer agreement with Raymond F. Beagle, Jr. which commenced July 1, 2001. (Incorporated by reference from Exhibit 10.27 to the Company's Form 10-K/A (File No. 1-8747) filed on July 27, 2001).</TD>
</TR>
<TR><TD WIDTH="13%" VALIGN="TOP">
<P>10.6</TD>
<TD WIDTH="87%" VALIGN="TOP">
<P>Employment agreement between AMC Entertainment Inc., American Multi-Cinema, Inc. and John D. McDonald which commenced July 1, 2001. (Incorporated by reference from Exhibit 10.29 to the Company's Form 10-K/A (File No. 1-8747) filed on July 27, 2001).</TD>
</TR>
</TABLE>

<P ALIGN="JUSTIFY">*&#9;Filed herewith </P>
<P ALIGN="JUSTIFY">(b)&#9;Reports on Form 8-K</P>
<B><P ALIGN="JUSTIFY">&#9;</B>On April 20, 2001, the Company filed a Form 8-K reporting under Item 9. the sale of $250 million of Preferred Stock on April 19, 2001.</P>
<P>&#9;On May 7, 2001, the Company filed a Form 8-K reporting under Item 5. details of the sale of $250 million of Preferred Stock on April 19, 2001.</P>
<P>&#9;On May 29, 2001, the Company filed a Form 8-K reporting under Item 9. the date of its year end earnings conference call and webcast.</P>
<FONT SIZE=2><P>&#9;</FONT>On May 30, 2001, the Company filed a Form 8-K reporting under Item 9. its operating results for fiscal year 2001.</P>
<P>&#9;On June 6, 2001, the Company filed a Form 8-K reporting under Item 5. its 2001 Annual Meeting of Stockholders date of September 13, 2001.</P>
<P>&#9;On July 12, 2001, the Company filed a Form 8-K reporting under Item 9. the date its first quarter earnings conference call and webcast for fiscal 2002.</P>
<P>&#9;On July 17, 2001, the Company filed a Form 8-K reporting under Item 9. its first quarter operating results for fiscal year 2002.</P>
<FONT SIZE=2><P>&#9;</P>
</FONT><B><P>SIGNATURES</P>
</B><P ALIGN="JUSTIFY">&#9;Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. </P>
<P ALIGN="JUSTIFY">&nbsp;</P>
<B><P ALIGN="JUSTIFY">AMC ENTERTAINMENT INC.</P>
</B><P ALIGN="JUSTIFY">Date:&#9;August 10, 2001</P>
<U><P ALIGN="JUSTIFY">/s/ Peter C. Brown </P>
</U><P ALIGN="JUSTIFY">Peter C. Brown</P>
<P ALIGN="JUSTIFY">Chairman of the Board, </P>
<P ALIGN="JUSTIFY">Chief Executive Officer and President</P>
<P ALIGN="JUSTIFY">&#9;&nbsp;</P>
<P ALIGN="JUSTIFY">Date:&#9;August 10, 2001&#9;</P>
<U><P ALIGN="JUSTIFY">/s/ Craig R. Ramsey </U>&#9;&#9;&#9;&#9;</P>
<P ALIGN="JUSTIFY">Craig R. Ramsey</P>
<P ALIGN="JUSTIFY">Senior Vice President, Finance,</P>
<P ALIGN="JUSTIFY">Chief Financial Officer and</P>
<P ALIGN="JUSTIFY">Chief Accounting Officer </P>
<P ALIGN="JUSTIFY">&nbsp;</P>
<P ALIGN="JUSTIFY">&nbsp;</P>
<FONT SIZE=2><P ALIGN="JUSTIFY">&nbsp;</P>
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<B><P ALIGN="RIGHT">EXHIBIT 4.6</P>
<P ALIGN="CENTER">SECURITIES PURCHASE AGREEMENT</P>
<P ALIGN="CENTER">&nbsp;</P>
</B><P ALIGN="JUSTIFY">This SECURITIES PURCHASE AGREEMENT (this "<B><I>Agreement</B></I>") is made and entered into as of the 29th day of June, 2001 by and among APOLLO INVESTMENT FUND IV, L.P., a Delaware limited partnership ("AIF IV"), APOLLO OVERSEAS PARTNERS IV, L.P., a Cayman Islands exempted limited partnership ("AOP IV"), APOLLO INVESTMENT FUND V, L.P., a Delaware limited partnership ("AIF V"), APOLLO OVERSEAS PARTNERS V, L.P., a Cayman Islands exempted limited partnership ("AOP V") (each of AIF IV, AOP IV, AIF V and AOP V being sometimes referred to herein individually as a "Seller" and collectively as the "Sellers"), APOLLO MANAGEMENT IV, L.P., a Delaware limited partnership, in its capacity as investment manager to AIF IV and AOP IV ("Apollo IV Management"), APOLLO MANAGEMENT V, L.P., a Delaware limited partnership, in its capacity as investment manager to AIF V and AOP V ("Apollo V Management" and collectively with Apollo IV Management and their affiliates, "Apollo"), AMC ENTERTAINMENT INC., a Delaware corporation (the <B><I>"Company"</B></I>), SANDLER CAPITAL PARTNERS V, L.P., a Delaware limited partnership ("SCP V Domestic"), SANDLER CAPITAL PARTNERS V FTE, L.P., a Delaware limited partnership ("SCP V FTE"), and SANDLER CAPITAL PARTNERS V GERMANY, L.P., a Delaware limited partnership ("SCP V Germany") (each of SCP V Domestic, SCP V FTE and SCP V Germany being sometimes referred to herein individually as a "Purchaser" and collectively as the "Purchasers"). Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Purchase Agreement (as defined below) in the form previously filed by the Company with the SEC.</P><DIR>
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</U><P ALIGN="JUSTIFY">WHEREAS, the Sellers previously acquired shares of Series A Convertible Preferred Stock of the Company, par value $0.66<SUP>2</SUP>/<SUB>3</SUB> per share (the "<B><I>Series A Preferred Stock</B></I>"), and shares of Series B Exchangeable Preferred Stock, par value $0.66<SUP>2</SUP>/<SUB>3</SUB> per share (the "<B><I>Series B Preferred Stock,</B></I>" and together with the Series A Preferred Stock, the "<B><I>Preferred Stock</B></I>"), pursuant to that certain Investment Agreement dated as of April 19, 2001 by and among the Company, the Sellers, Apollo Management IV and Apollo Management V (the <B><I>"Purchase Agreement"</B></I>);</P>
<P ALIGN="JUSTIFY">WHEREAS, concurrently with the closing of the Purchase Agreement, the Sellers also entered into that certain Registration Rights Agreement dated as of April 19, 2001 by and among the Company and the Sellers (the "<B><I>Registration Rights Agreement</B></I>"); </P>
<P ALIGN="JUSTIFY">&#9;&#9;WHEREAS, the Sellers desire to sell to the Purchasers certain of their respective shares of Preferred Stock acquired pursuant to the Purchase Agreement and the Purchasers desire to purchase such shares of Preferred Stock on the terms and conditions set forth in this Agreement; and</P>
<P>&#9;&#9;</P>
<P ALIGN="JUSTIFY">WHEREAS, the Company desires to consent to the purchase and sale of the shares of Preferred Stock between the Sellers and the Purchasers provided for hereunder and to the other transactions contemplated under this Agreement;</P>
<P ALIGN="JUSTIFY">NOW, THEREFORE, in consideration of the premises and the mutual representations, warranties and covenants herein contained, the parties hereto hereby agree as follows:</P>
<OL>
<OL>

<U><P ALIGN="JUSTIFY"><LI>Sale and Purchase of the Preferred Stock</U>. Subject to the terms and conditions of this Agreement, each of the Sellers severally agrees to sell and deliver to each of the Purchasers, and each of the Purchasers severally agrees to purchase from each of the Sellers, the number of shares of Preferred Stock described on Schedule 1 attached hereto with respect to such respective Seller and Purchaser, consisting in the aggregate of (i) 5,520 shares of Series A Preferred Stock at a purchase price of $1,000 per share, for an aggregate purchase price of $5,520,000, and (ii) 9,480 shares of Series B Preferred Stock at a purchase price of $1,000 per share, for an aggregate purchase price of $9,480,000, representing an aggregate purchase price of $15,000,000 (the "<B><I>Purchase Price</B></I>") for all of the shares of Preferred Stock to be sold hereunder by the Sellers to the Purchasers.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Payment and Delivery</U>. </LI></P>
<P ALIGN="JUSTIFY">&#9;(a)&#9;The closing of the sale to, and purchase by, the Purchasers of the shares of Preferred Stock referred to in Section 1 hereof (the "<B><I>Closing</B></I>") shall occur at the offices of Akin, Gump, Strauss, Hauer &amp; Feld, L.L.P., 1333 New Hampshire Ave. NW, Washington, DC 20036, at 10:00 a.m., on July 3, 2001 or such other location, date and time as agreed upon by the Purchasers and the Sellers (the "<B><I>Closing Date</B></I>"). </P>
<P ALIGN="JUSTIFY">&#9;(b)&#9;At the Closing, each Purchaser is paying to each Seller the portion of the Purchase Price set forth on Schedule 1 with respect to such respective Seller and Purchaser in U.S. dollars in immediately available funds by wire or other transfer to an account designated by the Sellers and each Seller is delivering to each Purchaser a certificate or certificates evidencing the number of shares of Preferred Stock to be sold by such Seller to such Purchaser in the amount set forth on Schedule 1, duly endorsed in blank, or accompanied by a stock power or stock powers duly executed in blank, in proper form for transfer. The Company shall, and shall cause its transfer agent to, take all such actions and execute, issue and deliver to the Purchasers such new stock certificates as may be necessary to give effect to the purchase and sale of the shares of Preferred Stock by the Sellers to the Purchasers as contemplated hereunder.</P>
<U><P ALIGN="JUSTIFY"><LI>Conditions of Parties' Obligations</U>.</LI></P>
<P ALIGN="JUSTIFY">(a)&#9;<U>Conditions of the Purchasers' Obligations</U>. The obligations of each Purchaser under Section 1 hereof are subject to the fulfillment prior to or on the Closing Date of all of the following conditions, any of which may be waived in whole or in part by the Purchasers.</P>
<P ALIGN="JUSTIFY">&#9;(i)&#9;<U>Representations and Warranties Correct</U>. The representations and warranties of the Sellers under this Agreement shall be true, complete and correct in all material respects on and as of the date hereof and on the Closing Date with the same force and effect as if they had been made on the Closing Date.</P>
<P ALIGN="JUSTIFY">&#9;(ii)&#9;<U>Compliance with Agreement</U>. The Sellers shall have performed and complied with all agreements and conditions required by this Agreement to be performed or complied with by them on or before the Closing Date.</P>
<P ALIGN="JUSTIFY">&#9;(b)&#9;<U>Conditions of Sellers' Obligations</U>. The Sellers' obligations under Section 1 hereof are subject to the fulfillment prior to or on the Closing Date of the following conditions, any of which may be waived in whole or in part by the Sellers.</P>
<P ALIGN="JUSTIFY">&#9;(i)&#9;<U>Representations and Warranties Correct</U>. The representations and warranties of the Purchasers under this Agreement shall be true, correct and complete, in all material respects, on and as of the date hereof and on the Closing Date with the same force and effect as if they had been made on the Closing Date.</P>
<P ALIGN="JUSTIFY">&#9;(ii)&#9;<U>Compliance with Agreement</U>. The Purchasers shall have performed and complied with all agreements and conditions required by this Agreement to be performed or complied with by them on or before the Closing Date.</P>
<P ALIGN="JUSTIFY">&#9;(iii)&#9;<U>Payment of Purchase Price</U>. The Sellers shall have received from the Purchasers the Purchase Price as set forth on <U>Schedule 1</U> hereto.</P>
<U><P ALIGN="JUSTIFY"><LI>Certain Restrictions on Conversion and Transfer; Assignment of Certain Rights.</U> </LI></P></OL>
</OL>

<P ALIGN="JUSTIFY">&#9;(a)&#9;<U>Restrictions on Conversion of Series A Preferred Stock</U>. During the period commencing on the date hereof and ending on April 19, 2006 (or such earlier date as of which the Sellers are permanently released from the conversion restrictions set forth in Section 9.5 of the Purchase Agreement) (the "Conversion Restriction Period"), the Purchasers shall not, without the prior written consent of the Company, convert any shares of Series A Preferred Stock into shares of the Company's Common Stock, except in connection with a Disposition effected pursuant to this Section 4(a). If at any time during the Conversion Restriction Period, any Purchaser desires to effect a Disposition of any shares of Series A Preferred Stock to any Person other than an Affiliate of such Purchaser, such Purchaser may, as part of such Disposition, elect to convert such shares of Series A Preferred Stock into Common Stock, prior to the transfer to such purchasing Person. In order to convert shares of Preferred Stock to effect any such Disposition, the selling Purchaser shall deliver to the Company, on or before the proposed settlement date of such Disposition, written notice of its intention to convert Series A Preferred Stock as part of a Disposition (a "Disposition Notice"). The Disposition Notice shall set forth the number of shares of Series A Preferred Stock that shall be converted into Common Stock, the sale price for such shares and the purchasing Person in whose name the Common Stock shall be registered. Upon surrender by the selling Purchaser of certificates representing the shares of Series A Preferred Stock that are being converted as part of such Disposition, the Company shall issue to the purchasing Person certificates representing the appropriate number of shares of Common Stock.</P>
<P ALIGN="JUSTIFY">&#9;&#9;(b)&#9;<U>Restrictions on Transfer of Series B Preferred Stock</U>. The Purchasers shall not transfer to any Person (other than their respective Affiliates) any shares of Series B Preferred Stock until October 19, 2002 (or such earlier date as of which the Sellers are permanently released from the transfer restrictions set forth in Section 9.6 of the Purchase Agreement), without the prior written consent of the Company.</P>
<P ALIGN="JUSTIFY">&#9;&#9;(c)&#9;<U>Assignment of Certain Rights Under the Purchase Agreement</U>. Each Seller hereby assigns to the respective Purchasers that are purchasing shares of Preferred Stock from such Seller all of such Seller's rights that are applicable to such shares of Preferred Stock with respect to indemnification by the Company under Section 12.4 of the Purchase Agreement and any other remedies of such Seller under the Purchase Agreement or otherwise that are applicable to such shares of Preferred Stock with respect to a breach of any of the representations, warranties or covenants made by the Company pursuant to the Purchase Agreement (subject to the provisions of Section 12.5 of the Purchase Agreement).</P>
<P ALIGN="JUSTIFY">&#9;&#9;(d)&#9;<U>Registration Rights Agreement</U>. Each Seller hereby assigns, subject to the conditions set forth herein, to each Purchaser its respective rights and obligations under the Registration Rights Agreement with respect to the shares of Preferred Stock it is selling pursuant to this Agreement, and the parties hereto agree that each Purchaser shall be deemed to have been added as a party to the Registration Rights Agreement as if it had been an original signatory thereto. As such, each Purchaser shall be deemed to be an "Investor" under the Registration Rights Agreement with respect to the shares of Preferred Stock it is acquiring from the Sellers hereunder (the "Transfer Shares"), and each Purchaser hereby agrees, effective as of the Closing, to assume all the rights, liabilities and obligations of Sellers under the Registration Rights Agreement with respect to the Transfer Shares and agrees to be subject to the terms thereof with respect to the Transfer Shares. Notwithstanding the foregoing, no Purchaser shall be deemed to be an "Investor" with respect to Section 13(i) of the Registration Rights Agreement. The parties hereto acknowledge and agree that the Transfer Shares (and the underlying shares of Common Stock issuable upon conversion of the Transfer Shares) shall be deemed to be "Registrable Shares" within the meaning of the Registration Rights Agreement.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;(i)&#9;In the event that the Sellers and/or their Affiliates exercise their demand registration rights pursuant to the Registration Rights Agreement, the Purchasers shall be entitled to participate in such demand registration on a Pro Rata Basis (as defined below). The Purchasers shall also be permitted to participate in any piggyback registration on a Pro Rata Basis.</P>
<OL TYPE="i">
<OL TYPE="i">
<OL TYPE="i">

<OL TYPE="i">

<P ALIGN="JUSTIFY"><LI>The Sellers will provide the Purchasers with prior written notice of any demand or piggyback registration that the Sellers and/or their Affiliates are participating in pursuant to the terms of the Registration Rights Agreement.</LI></P>
<P ALIGN="JUSTIFY"><LI>"<B><I>Pro Rata Basis</B></I>" means that right of the Purchasers to participate pro rata with the Sellers and their Affiliates based on a percentage that is determined by dividing the aggregate number of shares of Preferred Stock (on an as converted basis) and Conversion Shares (as defined below) owned by the Purchasers as of the date of determination and the aggregate number of shares of Preferred Stock (on an as converted basis) and Conversion Shares owned by the Sellers and their Affiliates as of the date of determination.</LI></P></OL>
</OL>
</OL>
</OL>

<P ALIGN="JUSTIFY">(e)&#9;<U>Legend</U>. Each Purchaser understands and agrees that the certificates evidencing the shares of Preferred Stock to be purchased hereunder will bear the following legend:</P><DIR>
<DIR>

<B><P ALIGN="JUSTIFY">THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES OR THE SECURITIES ARE SOLD AND TRANSFERRED IN A TRANSACTION THAT IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN LIMITATIONS ON TRANSFER SET FORTH IN A SECURITIES PURCHASE AGREEMENT DATED AS OF JUNE 29, 2001 AMONG AMC ENTERTAINMENT INC. AND CERTAIN OTHER PARTIES NAMED THEREIN, COPIES OF WHICH ARE ON FILE WITH THE SECRETARY OF AMC ENTERTAINMENT INC.</P></DIR>
</DIR>

</B><P ALIGN="JUSTIFY">&#9;&#9;(f)&#9;<U>Removal of Legend</U>. The Securities Act legend endorsed on the certificates pursuant to Section 4(e) hereof shall be removed and the Company shall issue a certificate without such legend to the holder thereof at such time as the securities evidenced thereby cease to be restricted securities upon the earliest to occur of (i) a registration statement with respect to the sale of such securities shall have become effective under the Securities Act of 1933, as amended (the <B><I>"Securities Act"</B></I>) and such securities shall have been disposed of in accordance with such registration statement, (ii) the securities shall have been sold to the public pursuant to Rule 144 (or any successor provision) under the Securities Act, or (iii)&nbsp;such securities may be sold by the holder without restriction or registration under Rule 144(k) under the Securities Act (or any successor provision).</P>
<OL>
<OL>

<U><P ALIGN="JUSTIFY"><LI>Representations and Agreements of the Sellers</U>. Each Seller severally, and not jointly, represents and warrants to each Purchaser as follows:</LI></P>
<P ALIGN="JUSTIFY">(a)&#9;<U>Organization and Power</U>. The Seller is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. The Seller has all requisite legal and partnership power to execute and deliver this Agreement and to carry out and perform its obligations under the terms of this Agreement.</P>
<P ALIGN="JUSTIFY">(b)&#9;<U>Authorization</U>. All partnership action on the part of the Seller necessary for the authorization, execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby (including, without limitation, the sale and delivery of the shares of Preferred Stock) has been taken. This Agreement has been duly and validly executed and delivered by the Seller, and constitutes a valid and binding agreement of the Seller, enforceable against the Seller in accordance with its terms, except to the extent that such enforceability (i) may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to creditors' rights generally and (ii) is subject to general principles of equity, regardless of whether enforcement is sought in a proceeding at law or in equity.</P>
<P ALIGN="JUSTIFY">(c)&#9;<U>Consents</U>. Except for filings, permits, authorizations, consents and approvals as may be required under, and other applicable requirements of, state blue sky laws and except for such reports with respect to the transactions contemplated under this Agreement as may be required to be filed by the Seller with the SEC under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations of the SEC thereunder, neither the execution, delivery or performance of this Agreement nor the consummation by the Seller of the obligations and transactions contemplated hereby requires any consent of, authorization by, exemption from, filing with, or notice to any Governmental Entity or any other Person. </P>
<P ALIGN="JUSTIFY">(d)&#9;<U>Ownership of Shares of Preferred Stock; Title and Related Matters</U>. The Seller owns and has valid, marketable and unencumbered title to the Transfer Shares that such Seller is selling to the Purchasers under this Agreement, free and clear of any security interest, mortgage, pledge, lien, charge, restriction or encumbrance of any nature whatsoever (collectively, "Liens"), other than the restrictions set forth in the Transaction Documents. Except for this Agreement, the Seller is not a party to any option, warrant, right, contract, call, put or other agreement or commitment providing for the disposition or acquisition of any of such Transfer Shares. Upon delivery by the Seller of such Transfer Shares to the Purchasers at the Closing, valid, marketable and unencumbered title to such Transfer Shares, free and clear of any Lien (other than the restrictions set forth in Sections 4(a) and 4(b) of this Agreement), will pass to the respective Purchasers of such Transfer Shares. </P>
<P ALIGN="JUSTIFY">(e)&#9;<U>No Conflict With Other Agreements, Etc.</U> The execution, delivery and performance of this Agreement and any other related documents and instruments contemplated herein by the Seller will not (i) conflict with or result in a breach of any provision of such Seller's agreement of limited partnership or other organizational documents, (ii) conflict with or result in the breach of the terms, conditions or provisions of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give rise to any right of termination, acceleration or cancellation under, any material agreement, lease, mortgage, license, indenture or other contract to which such Seller is a party or by which any of its properties or assets are bound or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including, without limitation, U.S. federal and state laws and regulations) applicable to such Seller or by which any of its properties or assets are bound or affected, except in the case of clauses (ii) or (iii), where such conflicts or violations would not prevent or materially delay its ability to consummate the transactions contemplated herein.</P>
<U><P ALIGN="JUSTIFY"><LI>Representations and Agreements of the Purchasers</U>. Each Purchaser severally, and not jointly, represents and warrants to each Seller as follows:</LI></P></OL>
</OL>

<P ALIGN="JUSTIFY">(a)&#9;<U>Organization and Power</U>. The Purchaser is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization. The Purchaser has all requisite legal and partnership power to execute and deliver this Agreement and to carry out and perform its obligations under the terms of this Agreement.</P>
<P ALIGN="JUSTIFY">&#9;(b)&#9;<U>Authorization</U>. All partnership action on the part of the Purchaser necessary for the authorization, execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby (including, without limitation, the purchase of the shares of Preferred Stock) has been taken. This Agreement has been duly and validly executed and delivered by the Purchaser, and constitutes a valid and binding agreement of the Purchaser, enforceable against the Purchaser in accordance with its terms, except to the extent that such enforceability (i) may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to creditors' rights generally and (ii) is subject to general principles of equity, regardless of whether enforcement is sought in a proceeding at law or in equity.</P>
<P ALIGN="JUSTIFY">&#9;(c)&#9;<U>Consents</U>. Except for filings, permits, authorizations, consents and approvals as may be required under, and other applicable requirements of, state blue sky laws and except for such reports with respect to the transactions contemplated under this Agreement as may be required to be filed by the Purchaser with the SEC under the Exchange Act and the rules and regulations of the SEC thereunder, neither the execution, delivery or performance of this Agreement nor the consummation by the Purchaser of the obligations and transactions contemplated hereby requires any consent of, authorization by, exemption from, filing with, or notice to any Governmental Entity or any other Person.</P>
<P ALIGN="JUSTIFY">&#9;(d)&#9;<U>Investment Representations of the Purchasers</U>. </P>
<OL TYPE="i">
<OL TYPE="i">
<OL TYPE="i">

<OL TYPE="i">

<P ALIGN="JUSTIFY"><LI>The shares of Preferred Stock being purchased by the Purchaser hereunder are being acquired for its own account as principal and not directly or indirectly for or on behalf of any other party and for the purpose of investment and not with a view to or for sale in connection with any distribution thereof.</LI></P>
<P ALIGN="JUSTIFY"><LI>The Purchaser is an "accredited investor" within the meaning of Rule 501(a) promulgated under the Securities Act. </LI></P>
<P ALIGN="JUSTIFY"><LI>The Purchaser (A) has been furnished with or has had full access to all of the information that it considers necessary or appropriate to make an informed investment decision with respect to the shares of Preferred Stock and (B) can bear the economic risk of such investment in the Preferred Stock, has such knowledge and experience in business and financial matters so as to enable it to understand and evaluate the risks of and form an investment decision with respect to its investment in the Preferred Stock and to protect its own interests in connection with such investment.</LI></P>
<P ALIGN="JUSTIFY"><LI>The Purchaser has no need for liquidity in its investment in the shares of Preferred Stock and is able to bear the economic risk of its investment in the shares of Preferred Stock and the complete loss of all of such investment.</LI></P>
<P ALIGN="JUSTIFY"><LI>The Purchaser understands that the transferability of the shares of Preferred Stock is restricted, and that such restrictions will be reflected in an appropriate legend on the instruments representing the shares of Preferred Stock.</LI></P>
<P ALIGN="JUSTIFY"><LI>The Purchaser recognizes that an investment in the Company involves certain risks and has taken full cognizance of, and understands all of, the risks related to the purchase of the shares of Preferred Stock. The Purchaser further acknowledges and understands that no federal or state agency has made any recommendation or endorsement of the Preferred Stock or any finding or determination as to the fairness of the investment therein.</LI></P></OL>
</OL>
</OL>
</OL>

<P ALIGN="JUSTIFY">(e)&#9;<U>No Conflict With Other Agreements, Etc.</U> The execution, delivery and performance of this Agreement and any other related documents and instruments contemplated herein by the Purchaser will not (i) conflict with or result in a breach of any provision of such Purchaser's agreement of limited partnership or other organizational documents, (ii) conflict with or result in the breach of the terms, conditions or provisions of or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give rise to any right of termination, acceleration or cancellation under, any material agreement, lease, mortgage, license, indenture or other contract to which such Purchaser is a party or by which any of its properties or assets are bound or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including, without limitation, U.S. federal and state laws and regulations) applicable to such Purchaser or by which any of its properties or assets are bound or affected, except in the case of clauses (ii) or (iii), where such conflicts or violations would not prevent or materially delay its ability to consummate the transactions contemplated herein.</P>
<OL>
<OL>

<U><P ALIGN="JUSTIFY"><LI>Participation Rights</U>.</LI></P></OL>
</OL>

<P ALIGN="JUSTIFY">(a)&#9;Each time the Sellers or their Affiliates propose to purchase any additional shares of equity securities (the <B><I>"Additional Equity Securities"</B></I>) (which shall include securities convertible into or exercisable for any shares of, any class of the Company's capital stock), such Sellers shall, and the Sellers shall use their reasonable efforts to cause their respective Affiliates (as applicable) and the Company to, prior to selling or issuing any such Additional Equity Securities to the Sellers, make an offering of such Additional Equity Securities to each of the Purchasers in accordance with the following provisions:</P>
<OL TYPE="i">
<OL TYPE="i">
<OL TYPE="i">

<OL TYPE="i">

<P ALIGN="JUSTIFY"><LI>The Sellers shall deliver a written notice (the <B><I>"Notice"</B></I>) by certified mail to each of the Purchasers stating (i) the bona fide intention of the Sellers and/or their Affiliates to purchase such Additional Equity Securities, (ii) the number of such Additional Equity Securities to be purchased, and (iii) the price and terms, if any, upon which the Sellers and/or their Affiliates propose to purchase such Additional Equity Securities.</LI></P>
<P ALIGN="JUSTIFY"><LI>Within five business days after giving of the Notice, each Purchaser may elect to purchase or obtain, at the price and on the terms specified in the Notice (which price shall be no greater than the price to be paid by, and the terms no less favorable than those offered to, any other party to purchase Additional Equity Securities of such issuance), up to that portion of such Additional Equity Securities which equals the proportion that the number of shares of Preferred Stock (on an as converted basis) and Conversion Shares held by such Purchaser bears to the total number of shares of Preferred Stock (on an as converted basis) and Conversion Shares then held by of all of the Sellers and/or their Affiliates participating in such issuance of Additional Equity Securities by giving written notice thereof to the Sellers (the <B><I>"Subscription Notice"</B></I>).</LI></P>
<P ALIGN="JUSTIFY"><LI>In the event that no Subscription Notices are received by the Sellers within the foregoing time period, the Sellers and/or their Affiliates, as the case may be, shall be entitled to freely purchase any such Additional Equity Securities, provided, however, that the price for such transaction shall not be lower than the price contained in the Notice and that the terms and conditions of the transaction are not, in the reasonable opinion of the Sellers, more favorable than those described in the Notice.</LI></P>
<P ALIGN="JUSTIFY"><LI>In the event that none of the Sellers and/or their Affiliates, as the case may be, purchase the Additional Equity Securities as described in the Notice, the Purchasers shall have no right to purchase Additional Equity Securities pursuant to the participation rights granted in this Section 7.</LI></P></OL>
</OL>
</OL>
</OL>

<P ALIGN="JUSTIFY">(b)&#9;The participation rights set forth in this Section 7 shall not be applicable to the issuance of: (i) equity securities pursuant to the conversion or exercise of convertible or exercisable securities, (ii) any stock, stock options, stock appreciation rights or similar rights issued or granted pursuant to a compensatory option plan, agreement or arrangement, and any shares of capital stock issued upon the exercise thereof; (iii) equity securities pursuant to any stock split or stock dividend, (iv) equity securities upon the subdivision, split-up, combination or reclassification of the outstanding equity securities of the Company or (ii)&nbsp;equity securities in connection with a bona fide business acquisition of or by the Company, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise.</P>
<P ALIGN="JUSTIFY">(c)&#9;The participation rights set forth in this Section 7 shall not be transferable to any Person who is not an Affiliate of the Purchasers. Notwithstanding the foregoing, if the Purchasers sell Preferred Stock or Conversion Shares to any Person, other than to Affiliates of the Purchasers, in an amount in excess of 33% of the shares of Preferred Stock and Conversion Shares owned by the Purchasers in the aggregate as of the date hereof after giving effect to the transactions contemplated hereby, the Purchasers may transfer or assign the participation rights set forth herein to such Person with the prior written consent of the Sellers, which consent will not be unreasonably withheld, and upon the agreement of such Person to be bound by all of the rights and obligations of such Purchaser under this Agreement upon the consummation of the proposed transfer. For purposes of this Section 7(c) only, the definition of "Affiliate" shall include any entity in which the Purchasers or their affiliates have exclusive management or investment control over.</P>
<OL>
<OL>

<U><LI>Restrictions on Transfer</U>.</LI></OL>
</OL>

<P ALIGN="JUSTIFY">(a)&#9;During the period commencing on the date hereof and ending on the second anniversary hereof, the Purchasers shall not, directly or indirectly (including, without limitation, through the disposition or transfer of any equity interest in another person), alone or in concert with others, sell, assign, transfer, pledge, hypothecate, grant any option with respect to or otherwise dispose of any interest in (or enter into an agreement or understanding with respect to the foregoing) (a<B><I> "Restricted Disposition"</B></I>) the common stock of the Company to be issued upon conversion of any shares of Series A Preferred Stock (including shares of Series A Preferred Stock issued upon the exchange of any shares of Series B Preferred Stock) (the <B><I>"Conversion Shares"</B></I>) in any public sale or offering to a Person who is not an Affiliate of the Purchasers in an amount that would exceed the volume limitations applicable to the Purchasers under the provisions of Rule 144, as promulgated under the Securities Act.</P>
<P ALIGN="JUSTIFY">(b)&#9;During the period commencing on the second anniversary of the date hereof and ending on the third anniversary hereof, the Purchasers shall not effect a Restricted Disposition of Conversion Shares in any public sale or offering to a Person who is not an Affiliate of the Purchasers in an amount that would exceed two times the average daily trading volume of the shares of the Common Stock, on the American Stock Exchange or other national securities exchange where the Common Stock is listed or to which the Common Stock is admitted for trading for the 30 trading days immediately proceeding the date of sale. </P>
<P ALIGN="JUSTIFY">(c)&#9;The limitations set forth in Sections 8(a) and 8(b) above shall terminate on the earlier to occur of:</P>
<OL TYPE="i">
<OL TYPE="i">
<OL TYPE="i">

<OL TYPE="i">

<P ALIGN="JUSTIFY"><LI>The third anniversary of the date hereof;</LI></P>
<P ALIGN="JUSTIFY"><LI>The date that the Sellers no longer own at least 90% of the shares of Preferred Stock owned by the Sellers on the date hereof, after giving effect to the transactions contemplated hereby.</LI></P></OL>
</OL>
</OL>
</OL>

<P ALIGN="JUSTIFY">(d)&#9;During the period commencing on the date hereof and ending on the third anniversary hereof, the Purchasers shall give the Sellers five business days prior written notice of its intention to sell any shares of Preferred Stock to any Person who is not an Affiliate of the Purchasers.</P>
<OL>
<OL>

<U><P ALIGN="JUSTIFY"><LI>Tag-Along Rights</U>.&#9;If the Sellers and/or any of their Affiliates (each a <B><I>"Selling Shareholder"</B></I>) propose to sell, in one transaction or a series of related transactions (<B><I>a "Tag-Along Sale"</B></I>), any shares of Preferred Stock or Conversion Shares to any Person, other than to Affiliates of the Sellers, (the <B><I>"Transferee"</B></I>), in an amount in excess of 50% of the shares of Preferred Stock and other equity securities of the Company owned by the Sellers and their Affiliates in the aggregate immediately prior to such sale (the <B><I>"Tag-Along Shares"</B></I>), the Purchasers (the <B><I>"Non-Selling Shareholders"</B></I>) shall have the right (the <B><I>"Tag-Along Right"</B></I>), but not the obligation, to participate in any such Tag-Along Sale, on the same terms and conditions as the Selling Shareholder(s) propose to sell their Tag-Along Shares, as set forth in the offer from the Transferee (the <B><I>"Offer"</B></I>), pursuant to the procedure set forth herein.</LI></P>
<P ALIGN="JUSTIFY">(a)&#9;In the event any Selling Shareholder wishes to sell the Tag-Along Shares, the Selling Shareholder shall first deliver written notice to the Non-Selling Shareholders of its intention to transfer the Tag-Along Shares to a non-Affiliate (<B><I>the "Transfer Notice"</B></I>). The Transfer Notice shall include (i) a description of the Tag-Along Shares to be transferred, (ii) the identity of the prospective transferee and (iii) the consideration and the material terms and conditions upon which the proposed transfer is to be made. The Transfer Notice shall also include a copy of any written proposal, term sheet, letter of intent or other agreement relating to the proposed transfer. Each Non-Selling Shareholder may exercise its Tag-Along Right by delivering to the nominated Selling Shareholder in the Transfer Notice (the <B><I>"Nominated Selling Shareholder"</B></I>) within five business days after receipt of the Notice (the <B><I>"Offer Period"</B></I>) a notice stating that such Non-Selling Shareholder intends to exercise its Tag-Along Rights and that it is willing to sell its own shares of Preferred Stock or Conversion Shares in accordance with the terms of the Offer (the <B><I>"Tag Along Notice",</B></I> and the Non-Selling Shareholder rendering such Tag-Along Notice, the <B><I>"Tagging Shareholder"</B></I>). If no Tag-Along Notice is received by the Nominated Selling Shareholder within the Offer Period, or if the notice received does not fulfill all of the foregoing requirements, it shall be understood that the Non-Selling Shareholders have waived their respective Tag-Along Rights hereunder and the Selling Shareholders shall be free to transfer the Tag-Along Shares.</P>
<P ALIGN="JUSTIFY">(b)&#9;Each Tagging Shareholder may sell all or any part of that number of shares of Preferred Stock or Conversion Shares equal to the product obtained by multiplying (i) the aggregate number of shares of Preferred Stock or Conversion Shares covered by the Transfer Notice by (ii) a fraction, the numerator of which is the number of shares of Preferred Stock or Conversion Shares owned by the Tagging Shareholder, determined on an "as converted" basis, on the date of the Transfer Notice and the denominator of which is the total number of shares of Preferred Stock or Conversion Shares owned by all of the Non-Selling Shareholders and the Selling Shareholders, determined on an "as converted" basis, on the date of the Transfer Notice.</P>
<P ALIGN="JUSTIFY">(c)&#9;Each Tagging Shareholder shall effect its participation in the sale by promptly delivering to the Nominated Selling Shareholder, at or prior to the closing of such sale, for transfer to the prospective purchaser one or more certificates, properly endorsed for transfer, which represent the Tag-Along Shares. To the extent that any prospective Transferee refuses to purchase any shares of Preferred Stock or Conversion Shares from a Tagging Shareholder, the Selling Shareholders shall not sell to such prospective Transferee any Tag-Along Shares unless and until, simultaneously with such sale, the Selling Shareholders shall purchase from such Tagging Shareholder the shares of Preferred Stock and Conversion Shares such Tagging Shareholder would otherwise have been able to sell hereunder for the same consideration and on the same terms and conditions as the proposed sale described in the Transfer Notice.</P>
<P ALIGN="JUSTIFY">&#9;(d)&#9;In connection with any transfer by a Seller of shares of Preferred Stock or Conversion Shares to an Affiliate, such Seller shall cause such Affiliate to agree to be bound by the provisions of this Section 9 with respect to such transferred shares.</P>
<U><P ALIGN="JUSTIFY"><LI>Protective Provisions</U>. The Sellers shall not, without the prior written consent of the Purchasers, effect any amendment to the Registration Rights Agreement that would affect the Purchasers' rights pursuant to the Registration Rights Agreement in a manner which is different from the effect on the Sellers' rights pursuant to the Registration Rights Agreement.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Notices</U>. All notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be hand delivered or mailed postage prepaid by registered or certified mail,</LI></P></OL>
</OL>

<P ALIGN="JUSTIFY">&#9;(a)&#9;If to the Purchaser:</P>
<P ALIGN="JUSTIFY">&#9;Sandler Capital Partners V, L.P.</P>
<P ALIGN="JUSTIFY">&#9;Sandler Capital Partners V, FTE, L.P.</P>
<P ALIGN="JUSTIFY">&#9;Sandler Capital Partners V Germany, L.P.</P>
<P ALIGN="JUSTIFY">&#9;c/o Sandler Capital Management</P>
<P ALIGN="JUSTIFY">&#9;767 Fifth Avenue, 45<SUP>th</SUP> Floor</P>
<P ALIGN="JUSTIFY">&#9;New York, NY 10153</P>
<P ALIGN="JUSTIFY">&#9;Attention: Douglas E. Schimmel</P>
<P ALIGN="JUSTIFY">&#9;Fax: (212) 826-0281</P><DIR>
<DIR>
<DIR>
<DIR>

<P ALIGN="JUSTIFY">(b) &#9;If to the Sellers or Apollo:</P></DIR>
</DIR>
</DIR>
</DIR>

<P ALIGN="JUSTIFY">&#9;Apollo Investment Fund IV, L.P.</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P ALIGN="JUSTIFY">Apollo Overseas Partners IV, L.P.</P>
<P ALIGN="JUSTIFY">c/o Apollo Management IV, L.P. and</P>
<P ALIGN="JUSTIFY">Apollo Investment Fund V, L.P.</P>
<P ALIGN="JUSTIFY">Apollo Overseas Partners V, L.P.</P>
<P ALIGN="JUSTIFY">c/o Apollo Management V, L.P.</P>
<P ALIGN="JUSTIFY">1301 Avenue of the Americas</P>
<P ALIGN="JUSTIFY">38th Floor</P>
<P ALIGN="JUSTIFY">New York, NY 10019</P>
<P ALIGN="JUSTIFY">Attention: Marc Rowan</P>
<P ALIGN="JUSTIFY">Fax: (212) 515-3263</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>

<P ALIGN="JUSTIFY">&#9;with copies to:</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P ALIGN="JUSTIFY">Akin, Gump, Strauss, Hauer &amp; Feld, L.L.P.</P><DIR>
<DIR>

<P ALIGN="JUSTIFY">1333 New Hampshire Ave., N.W.</P></DIR>
</DIR>

<P ALIGN="JUSTIFY">Washington, D.C. 20036</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P ALIGN="JUSTIFY">Attention: Bruce S. Mendelsohn</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>

<P ALIGN="JUSTIFY">Fax: (202) 887-4288</P></DIR>
</DIR>
</DIR>
</DIR>

<P>or (c)&#9; If to the Company:</P><DIR>
<DIR>
<DIR>
<DIR>

<P>AMC Entertainment Inc.</P></DIR>
</DIR>

<P>106 West 14th Street</P>
<P>P.O. Box 419615</P>
<P>Kansas City, MO 64105</P>
<P>Attention: Peter Brown</P>
<P>Fax: (816) 480-2517</P><DIR>
<DIR>

<P>with a copy to:</P>
<P>Lathrop &amp; Gage L.C.</P></DIR>
</DIR>

<P>2345 Grand Boulevard</P>
<P>Suite 2800</P>
<P>Kansas City, MO 64108</P>
<P>Attention: Raymond F. Beagle, Jr.</P>
<P>Fax: (816) 292-2001</P></DIR>
</DIR>
</DIR>
</DIR>

<P ALIGN="JUSTIFY">or at such other address as the respective parties each may specify by written notice to the other parties, and each such notice, request, consent and other communication shall for all purposes of the Agreement be treated as being effective or having been given when delivered if delivered personally, or, if sent by mail, at the earlier of its receipt or 72 hours after the same has been deposited in a regularly maintained receptacle for the deposit of United States mail, addressed and postage prepaid as aforesaid.</P>
<OL>
<OL>

<U><P ALIGN="JUSTIFY"><LI>AMC Consent</U>. </LI></P>
<P ALIGN="JUSTIFY">(a)&#9;The Company hereby consents to the sale of the Preferred Stock, including the Series B Preferred Stock, by the Sellers to the Purchasers and to the assignment of all of the rights and obligations set forth in Section 4 hereof. The Company hereby acknowledges and agrees that the shares of the Preferred Stock which are owned by the Purchasers shall be freely transferable by the Purchasers, subject to compliance with applicable securities laws and the restrictions contained in Sections 4(a) and 4(b) of this Agreement.</P>
<P ALIGN="JUSTIFY">(b)&#9;The Company hereby consents to the assignment by the Sellers of the rights and obligations pursuant to the Registration Rights Agreement to the Purchasers as set forth in Section 4(d) hereof.</P>
<P ALIGN="JUSTIFY">(c)&#9;The Company and the Sellers hereby acknowledge and agree that Section 8.1 (Preferred Stock Approval Rights) and 9.7(i) (Preferred Stock Approval Rights) of the Purchase Agreement shall be amended to provide that the Sellers shall have the Preferred Stock Approval Rights so long as the Sellers continue to beneficially own shares of Preferred Stock representing more than 50% of the Preferred Stock owned by the Sellers immediately after the consummation of the transactions contemplated hereby.</P>
<P ALIGN="JUSTIFY">(d)&#9;The Company is executing this Agreement solely for purposes of this Section 12, and, except as set forth in Section 2(b), shall have no other obligations under this Agreement.</P>
<U><P ALIGN="JUSTIFY"><LI>Fees and Expenses</U>. Each party will bear its own fees and expenses incurred in connection with the proposed purchase and sale of the Preferred Stock and the negotiation, execution and delivery of the Purchase Agreement.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Receipt of Dividends</U>. Notwithstanding anything herein to the contrary, the dividend on the Preferred Stock to be paid to the holders of record on July 2, 2001 shall be paid, in its entirety, to the Sellers.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Termination of Agreement</U>. This Agreement may be terminated prior to the Closing Date as follows:</LI></P>
<P ALIGN="JUSTIFY">(a)&#9;by mutual consent of the Purchasers and the Sellers;</P>
<P ALIGN="JUSTIFY">(b)&#9;at the election of the Sellers, if any one or more of the conditions to their obligations have not been fulfilled as of the Closing Date;</P>
<P ALIGN="JUSTIFY">(c)&#9;at the election of the Purchasers, if any one or more of the conditions to their obligations have not been fulfilled as of the Closing Date;</P>
<P ALIGN="JUSTIFY">In the event that the Sellers or the Purchasers, as the case may be, elect to terminate this Agreement, it shall deliver an irrevocable notice to the other party to this Agreement declaring its election to so terminate this Agreement in accordance with the provisions of this Section 15, and setting forth therein the basis for such termination.</P>
<U><P ALIGN="JUSTIFY"><LI>Severability</U>. Should any one or more of the provisions of this Agreement or of any agreement entered into pursuant to this Agreement be determined to be illegal or unenforceable, all other provisions of this Agreement and of each other agreement entered into pursuant to this Agreement shall be given effect separately from the provision or provisions determined to be illegal or unenforceable and shall not be affected thereby.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Parties in Interest</U>. All the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective parties hereto, the successors and assigns of the Purchasers and the Sellers, whether so expressed or not. This Agreement shall not run to the benefit of or be enforceable by any other Person.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Successors and Assigns</U>. Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto and shall inure to the benefit of and be enforceable by each person who shall be a holder of shares of the Preferred Stock and/or the Conversion Shares. Notwithstanding the foregoing and in addition to the restrictions set forth in Section 7(c), the rights and obligations granted to the Purchasers pursuant to Sections 4(c), 4(d), 9 and 10 of this Agreement are not transferable; provided, however, that such rights may be transferred to an Affiliate of any Purchaser who agrees to be bound by all the rights and obligations of such Purchaser under this Agreement upon the consummation of the proposed transfer.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Headings</U>. The headings of the sections and paragraphs of this Agreement have been inserted for convenience of reference only and do not constitute a part of this Agreement.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Choice of Law</U>. It is the intention of the parties that the internal laws, and not the laws of conflicts, of the State of New York should govern the enforceability and validity of this Agreement, the construction of its terms and the interpretation of the rights and duties of the parties.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Counterparts</U>. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, with the same effect as if all parties had signed the same document. All such counterparts shall be deemed an original, shall be construed together and shall constitute one and the same instrument.</LI></P>
<U><P ALIGN="JUSTIFY"><LI>Further Assurances</U>. Each of the undersigned, upon request of another party hereto, agrees to execute and deliver such further documents and instruments, and to perform such further acts, as may be necessary to accomplish and give full effect to this Agreement and sale of the Preferred Stock contemplated hereby.</LI></P></OL>
</OL>

<I><P>&#9;</I>IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed as of the day and year first above written.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;<B><I>Sellers</I>:</P>
</B><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;APOLLO INVESTMENT FUND IV, L.P.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;APOLLO ADVISORS IV, L.P.,</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;Apollo Capital Management IV, Inc.,</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;<U>/s/ Michael D. Weiner</P>
</U><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Name: Michael D. Weiner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Title: Vice President</P>
<P ALIGN="JUSTIFY">&nbsp;</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;APOLLO OVERSEAS PARTNERS IV, L.P.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;APOLLO ADVISORS IV, L.P.,</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Managing General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;Apollo Capital Management IV, Inc.,</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;<U>/s/ Michael D. Weiner</P>
</U><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Name: Michael D. Weiner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Title: Vice President</P>
<P ALIGN="JUSTIFY">&nbsp;</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;APOLLO INVESTMENT FUND V, L.P.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;APOLLO ADVISORS V, L.P.,</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;Apollo Capital Management V, Inc.,</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;<U>/s/ Michael D. Weiner</P>
</U><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Name: Michael D. Weiner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Title: Vice President</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;APOLLO OVERSEAS PARTNERS V, L.P.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;APOLLO ADVISORS V, L.P.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Managing General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;Apollo Capital Management V, Inc.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;General Partner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;<U>/s/ Michael D. Weiner</P>
</U><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Name: Michael D. Weiner</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Title: Vice President</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P>&#9;&#9;&#9;&#9;&#9;&#9;</P>
<P>APOLLO MANAGEMENT IV, L.P.</P>
<P>&#9;in its capacity as investment manager to</P>
<P>&#9;Apollo Investment Fund IV, L.P.</P><DIR>

<P>By:&#9;AIF IV Management, Inc.</P><DIR>

<P>By:&#9; <U>/s/ Michael D. Weiner</P><DIR>

</U><P>Name: Michael D. Weiner</P>
<P>Title: Vice President</P>
<P>&nbsp;</P></DIR>
</DIR>
</DIR>

<P>APOLLO MANAGEMENT V, L.P.</P>
<P>in its capacity as investment manager to </P>
<P>Apollo Investment Fund V, L.P.</P><DIR>

<P>By:&#9;AIF V Management, Inc.</P><DIR>

<P>By: <U>/s/ Michael D. Weiner</P><DIR>

</U><P>Name: Michael D. Weiner</P>
<P>Title: Vice President</P>
<P ALIGN="JUSTIFY">&nbsp;</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>

<P ALIGN="JUSTIFY">&#9;&#9;&#9; &#9;<B><I>The Company</I>:</P>
</B><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;AMC ENTERTAINMENT INC.</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;By:&#9;<U>/s/ Peter C. Brown</P>
</U><P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;&#9;Name: Peter C. Brown</P><DIR>
<DIR>

<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;Title: Chairman of the Board, President and</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P ALIGN="JUSTIFY">Chief Executive Officer</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>

<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;<B><I>Purchasers</B></I>:</P>
<P ALIGN="JUSTIFY">&#9;&#9;&#9;&#9;&#9;&#9;SANDLER CAPITAL PARTNERS V, L.P.</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

<P>By:&#9;Sandler Investment Partners, L.P., General Partner</P>
<P>By:&#9;Sandler Capital Management, General Partner</P></DIR>
</DIR>
</DIR>
</DIR>

<P>By:&#9;MJDM Corp., a General Partner</P>
<P>By:&#9;<U>/s/ Moira Mitchell</P><DIR>
<DIR>

</U><P>Name: Moira Mitchell</P><DIR>
<DIR>

<P>Title: President</P>
<P>&nbsp;</P></DIR>
</DIR>
</DIR>
</DIR>

<P>SANDLER CAPITAL PARTNERS V FTE, L.P.</P><DIR>
<DIR>
<DIR>
<DIR>

<P>By:&#9;Sandler Investment Partners, L.P., General Partner</P>
<P>By:&#9;Sandler Capital Management, General Partner</P></DIR>
</DIR>
</DIR>
</DIR>

<P>By:&#9;MJDM Corp., a General Partner</P>
<P>By:&#9;<U>/s/ Moira Mitchell</P><DIR>
<DIR>

</U><P>Name: Moira Mitchell</P>
<P>Title: President</P>
<P>&nbsp;</P>
<P>SANDLER CAPITAL PARTNERS V GERMANY, L.P.</P><DIR>
<DIR>

<P>By:&#9;Sandler Investment Partners, L.P., General Partner</P>
<P>By:&#9;Sandler Capital Management, General Partner</P></DIR>
</DIR>
</DIR>
</DIR>

<P>By:&#9;MJDM Corp., a General Partner</P>
<P>By:&#9;<U>/s/ Moira Mitchell</P><DIR>
<DIR>

</U><P>Name: Moira Mitchell</P>
<P>Title: President</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>

<B><FONT SIZE=4><P ALIGN="CENTER">Schedule 1</P>
</B></FONT><P>&lt;Table&gt;</P>
<P>&lt;Caption&gt;&nbsp;</P>
<P ALIGN="CENTER"><CENTER><TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=887>
<TR><TD WIDTH="25%" VALIGN="TOP" BGCOLOR="#ffffff">
<P><B>Seller</B></TD>
<TD WIDTH="30%" VALIGN="TOP" BGCOLOR="#ffffff">
<B><P>Purchaser</B></TD>
<TD WIDTH="23%" VALIGN="TOP" BGCOLOR="#ffffff">
<B><P>Number of Shares of Preferred Stock Purchased</B></TD>
<TD WIDTH="22%" VALIGN="TOP" BGCOLOR="#ffffff">
<B><P>Purchase Price of the Preferred Stock</B></TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&lt;S&gt;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>&lt;C&gt;</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>&lt;C&gt;</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>&lt;C&gt;</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>Apollo Investment Fund IV, L.P.</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 1,859</P>
<P>Series B: 3,192</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $1,859,000.00</P>
<P>Series B: $3,192,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V FTE, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 687</P>
<P>Series B: 1,180</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $687,000.00</P>
<P>Series B: $1,180,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V Germany, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 69</P>
<P>Series B: 118</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $69,000.00</P>
<P>Series B: $118,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>Apollo Overseas Partners IV, L.P.</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 103</P>
<P>Series B: 177</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $103,000.00</P>
<P>Series B: $177,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V FTE, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 38</P>
<P>Series B: 66</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $38,000.00</P>
<P>Series B: $66,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V Germany, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 4</P>
<P>Series B: 7</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $4,000.00</P>
<P>Series B: $7,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>Apollo Investment Fund V, L.P.</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 1,863</P>
<P>Series B: 3,199</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $1,863,000.00</P>
<P>Series B: $3,199,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V FTE, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 689</P>
<P>Series B: 1,183</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $689,000.00</P>
<P>Series B: $1,183,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V Germany, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 69</P>
<P>Series B: 119</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $69,000.00</P>
<P>Series B: $119,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>Apollo Overseas Partners V, L.P.</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 98</P>
<P>Series B: 170</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $98,000.00</P>
<P>Series B: $170,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V FTE, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 37</P>
<P>Series B: 63</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $37,000.00</P>
<P>Series B: $63,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>Sandler Capital Partners V Germany, L.P.</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>Series A: 4</P>
<P>Series B: 6</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>Series A: $4,000.00</P>
<P>Series B: $6,000.00</TD>
</TR>
<TR><TD WIDTH="25%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="30%" VALIGN="TOP">
<P>&nbsp;</TD>
<TD WIDTH="23%" VALIGN="TOP">
<B><P>Total: 15,000</B></TD>
<TD WIDTH="22%" VALIGN="TOP">
<B><P>Total: $15,000,000.00</B></TD>
</TR>
</TABLE>
</CENTER></P>

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