The old guy in the collar chain (William B. Davis, "The X-Files'" Cigarette Smoking Man) is Benjamin Hartley, the kid in the 1940s opening who killed the girl who was nearly raped by her date, Benjamin's older brother Ivor, who turns out to be the old man in the woods (Raymond J. Barry) who kills dogs (and people) on the shortcut through his property. When Ivor got back from serving in World War II, he found that his parents had attached a long chain to Benjamin, whose violent and generally anti-social behavior earned him a diagnosis of "deranged," to keep him from killing anything (or anyone), and Ivor, promising to always "protect" him, has kept Benjamin chained up ever since.
On their final spy trip to the Hartley property, all of Derek's (Drew Seeley) new friends are knocked off one by one: As Taylor (Josh Emerson) tries to free Benjamin from his chain with a sledgehammer (obviously, the kids have no idea who he is), Benjamin yanks the chain, pulling Mark (Dave Franco), holding the other end of the chain, so that the sledgehammer comes down on Mark's hand. While Lisa (Shannon Woodward) tries to get a signal on her cell phone, Taylor goes to Mark, and Benjamin clubs Taylor to death with the sledgehammer, then kills Mark the same way.
Lisa runs, and finds Derek and Christy (Katrina Bowden), who have just arrived in Derek's car. As soon as she piles in, Ivor rams the back of the car with his pickup, then starts blasting out the windows with his shotgun. For reasons we cannot fathom, instead of driving away, the kids jump out of the car (think about it: unless it's a VW Bug or a Porsche 911 or the like, you can't disable a car by ramming it in the rear; the engine is up front) and flee on foot.
Ivor shoots Lisa in the back of one leg and Benjamin strangles Christy to death with his chain. Derek is about to club Benjamin with the sledgehammer, but is stopped by Ivor. It looks like Ivor is going to kill Derek and Lisa, but he shoots Benjamin instead, then blows his own head off.
Derek supports the wounded Lisa as they stumble through the woods. They stop so Derek can look at her leg, and suddenly Lisa is stabbed in the back by Tobey (Nicholas Elia), Derek's creepy little brother. Tobey offers a shrug and an insincere "Sorry," then asks if this means they will have to move again. Derek assures him everything will be fine, and the brothers pick up Lisa's body to bury it somewhere. As the two talk, it becomes clear that this is not Tobey's first murder; the reason Derek and Tobey's father "isn't around" is that Tobey killed him.