What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2023-02-28 compared with 2022-03-01 · 620 added, 474 removed, 1735 unchanged (39% of the section changed)

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Chairman of the Board, Chief Executive Officer and President

Executive Vice President, Chief Financial Officer and Treasurer

Executive Vice President, International Operations, Chief Financial Officer and Treasurer

Report of Independent Registered Public Accounting Firm

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We have audited the accompanying consolidated balance sheets of AMC Entertainment Holdings, Inc.

and subsidiaries (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive loss, shareholders’ equity (deficit), and cash flows for each of the two years in the period ended December 31, 2021, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2021, in conformity with U.S.

(the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive loss, stockholders’ equity (deficit), and cash flows for each of the three years in the period ended December 31, 2022, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with U.S.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated March 1, 2022 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 28, 2023 expressed an unqualified opinion thereon.

Basis for Opinion

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The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Valuation of operating leases

Impairment of long-lived assets

Description of the Matter

At December 31, 2021, the Company’s operating lease right of use assets and operating lease liabilities were $4.2 billion and $5.3 billion, respectively.

As discussed in Note 3 of the consolidated financial statements, the present value of the lease payments is calculated using the incremental borrowing rate (IBR) for operating leases.

Since most of the leases do not provide a determinable implicit rate, the Company estimated its IBR used to calculate its right of use assets and lease liabilities.

Auditing the Company’s estimate of the IBR was especially challenging as it involved a high degree of subjective judgment when testing the reasonableness of the inputs and appropriateness

of the rates applied to each lease.

In particular, the estimate of the IBR is sensitive to significant assumptions such as the determination of the current credit rating and selection of the associated yield curve.

At December 31, 2022, the Company recorded impairment charges related to long-lived assets of $73.4 million and $59.7 million on theatres in the US and International markets, respectively.

As discussed in Note 1 to the consolidated financial statements, the Company evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset group may not be fully recoverable.

Asset groups are evaluated for impairment on an individual theatre basis, which management believes is the lowest level for which there are identifiable cash flows.

The Company estimates the future

undiscounted cash flows to be generated by the asset groups and compares those estimates to the carrying value of the related asset groups.

If the carrying value exceeds the future undiscounted cash flows, the asset group may be impaired.

If the asset group is determined to be impaired, the carrying value of the asset group is reduced to fair value as estimated by a discounted cash flow model, with the difference recorded as an impairment charge.

Auditing management’s long-lived asset impairment analysis was highly judgmental due to the estimation required in determining the undiscounted cash flows and related fair values of an impaired asset group.

In particular, the cash flows were sensitive to significant assumptions such as admissions revenue expectations, long term growth rates, and discount rates.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s determination of the IBR.

For example, we tested management’s review controls over this process.

To test the Company’s determination of the IBR, our audit procedures included, among others, an evaluation of management’s methodology for developing the IBR and a comparison of certain assumptions used by management to our independent estimates which were developed with the assistance of our specialists.

We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s assessment of the projected undiscounted cash flows to be generated by asset groups, and cash flows used to determine fair value for certain asset groups.

This included internal controls over management’s review of the significant assumptions underlying the undiscounted cash flow and fair value determination.

We also tested management’s controls to validate that the data used in the analysis was complete and accurate.

To test the significant assumptions described above, we performed audit procedures that included testing the significant assumptions discussed above and the underlying data used by the Company in the analysis.

We compared the significant assumptions used by the Company to current industry and economic trends.

We performed a sensitivity analysis of the impact of certain assumptions on the estimates and recalculated management’s estimates.

We also involved our valuation specialists to assist in our evaluation of the discount rate used in the fair value estimates.

/s/ Ernst & Young LLP

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Kansas City, Missouri

March 1, 2022

February 28, 2023

Report of Independent Registered Public Accounting Firm

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We have audited AMC Entertainment Holdings, Inc.

and subsidiaries’ internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, AMC Entertainment Holdings, Inc.

and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive loss, shareholders’ equity (deficit), and cash flows for each of the two years in the period ended December 31, 2021 and our report dated March 1, 2022 expressed an unqualified opinion thereon.

(the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive loss, stockholders’ equity (deficit), and cash flows for each of the three years in the period ended December 31, 2022 and our report dated February 28, 2023 expressed an unqualified opinion thereon.

Basis for Opinion

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Kansas City, Missouri

March 1, 2022

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors AMC Entertainment Holdings, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of operations, comprehensive loss, cash flows, and stockholders’ equity (deficit) of AMC Entertainment Holdings, Inc.

and subsidiaries (the Company) for the year ended December 31, 2019, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the results of the Company’s operations and its cash flows for the year ended December 31, 2019, in conformity with U.S.

generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provides a reasonable basis for our opinion.

We served as the Company’s auditor from 2009 to 2020.

Kansas City, Missouri

February 28, 2023

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Operating costs and expenses

Operating income (loss)

Other expense (income):

Operating loss

Other expense, net:

Other expense (income)

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Non-cash NCM exhibitor services agreement

Equity in (earnings) loss of non-consolidated entities

Equity in loss (earnings) of non-consolidated entities

Investment expense (income)

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Unrealized foreign currency translation adjustments

Realized gain (loss) on foreign currency transactions reclassified into investment expense (income), net of tax

Realized loss on foreign currency transactions reclassified into investment expense (income), net of tax

Pension adjustments:

Net gain (loss) arising during the period, net of tax

Equity method investee's cash flow hedge:

Unrealized net holding loss arising during the period

Net gain (loss) arising during the period

Other comprehensive income (loss):

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Other long-term assets

LIABILITIES AND STOCKHOLDERS’ EQUITY

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

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AMC Entertainment Holdings, Inc.'s stockholders' deficit:

Preferred stock, $ 0.01 par value per share, 50,000,000 shares authorized;

including Series A Convertible Participating Preferred Stock, 10,000,000 authorized, 7,245,872 issued and outstanding as of December 31, 2022;

5,139,791 issued and outstanding December 31, 2021, represented by AMC Preferred Equity Units, each representing a 1/100th interest in a share of Series A Convertible Participating Preferred Stock, of which 1,000,000,000 is authorized;

724,587,058 issued and outstanding as of December 31, 2022;

513,979,100 issued and outstanding as of December 31, 2021

Class A common stock $ 0.01 par value, 524,173,073 shares authorized;

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513,979,100 shares issued and outstanding as of December 31, 2021)

Class B common stock ($ .01 par value, 0 shares authorized, issued and outstanding as of December 31, 2021 and 51,769,784 shares authorized, issued and outstanding as of December 31, 2020)

Additional paid-in capital

Treasury stock ( 0 shares as of December 31, 2021 and 3,732,625 shares as of December 31, 2020, at cost)

Accumulated other comprehensive income (loss)

Accumulated other comprehensive loss

Accumulated deficit

Total AMC Entertainment Holdings, Inc.'s stockholders’ deficit

Noncontrolling interests

Total deficit

Total stockholders' deficit

Total liabilities and stockholders’ deficit

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Cash flows from operating activities:

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

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Gain on dispositions of Baltics

Amortization of net discount (premium) on corporate borrowings to interest expense

Unrealized loss on investments Hycroft

(Gain) loss on sale of NCM investments

Amortization of net premium on corporate borrowings to interest expense

Amortization of deferred financing costs to interest expense

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Non-cash portion of stock-based compensation

Loss (gain) on disposition of assets

Loss (gain) on derivative asset and derivative liability

Gain on disposition of assets

Loss on derivative asset and derivative liability

Equity in loss from non-consolidated entities, net of distributions

Landlord contributions

Other non-cash rent expense (benefit)

Other non-cash rent benefit

Deferred rent

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Accrued expenses and other liabilities

Net cash provided by (used in) operating activities

Net cash used in operating activities

Cash flows from investing activities:

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Proceeds from disposition of long-term assets

Proceeds from sale of securities

Investments in non-consolidated entities, net

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Cash flows from financing activities:

Proceeds from issuance of Term Loan due 2026

Payment of principal Senior Secured Notes due 2023

Payment of principal Senior Subordinated Notes due 2022

Call premiums paid for Senior Secured Notes due 2023 and Senior Subordinated Notes due 2022

Principal payment of Term Loans due 2022 and 2023

Proceeds from issuance of First Lien Notes due 2029

Proceeds from issuance of Odeon Term Loan due 2023

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Proceeds from issuance of First Lien Notes due 2026

Borrowings (repayments) under revolving credit facilities

Principal payments under First Lien Notes due 2025

Premium paid to extinguish First Lien Notes due 2025

Principal payments under First Lien Notes due 2026

Premium paid to extinguish First Lien Notes due 2026

Repurchase of Second Lien Subordinated Debt 2026

Principal payments under Odeon Term Loan due 2023

Premium paid to extinguish Odeon Term Loan due 2023

Proceeds from issuance of Odeon Senior Secured Notes due 2027

Repurchase of Senior Subordinated Notes Due 2027

Repayments under revolving credit facilities

Scheduled principal payments under Term Loan due 2026

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Net proceeds from Class A common stock issuance to Mudrick

(Payments) proceeds related to sale of noncontrolling interest

Net proceeds from AMC Preferred Equity Units issuance

Payments related to sale of noncontrolling interest

Principal payments under finance lease obligations

Principal payments under promissory note

Cash used to pay for deferred financing costs

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Cash paid during the period for:

Interest (including amounts capitalized of $ 0.2 million, $ 1.1 million and $ 1.0 million, respectively)

Income taxes received, net

Interest (including amounts capitalized of $ 0.1 million, $ 0.2 and $ 1.1 million, respectively)

Income taxes paid (received), net

Schedule of non-cash activities:

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Construction payables at period end

Convertible Notes due 2026 conversion, see Note 8-Corporate Borrowings and Finance Lease Obligations

Mudrick transaction, see Note 8-Corporate Borrowings and Finance Lease Obligations

AMC Preferred Equity Units issuance costs payable at year end

Convertible Notes due 2026 conversion, see Note 8-Corporate Borrowings and Finance Lease Liabilities

Mudrick transaction, see Note 8-Corporate Borrowings and Finance Lease Liabilities

DCIP digital projectors transaction, see Note 6-Investments

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

Preferred Stock

Series A Convertible

Depositary Shares

Class A Voting

Class B Voting

Participating

Class A and Class B Common Stock

Preferred Stock

Preferred Equity

Treasury Stock

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Cumulative effect adjustments for the adoption of new accounting principle (ASC 842)

Other comprehensive loss

Dividends declared:

Class A common stock, $ 0.20 /share, net of forfeitures and reversal of dividend accrual for nonvested PSUs

Class B common stock, $ 0.20 /share

RSUs surrendered to pay for payroll taxes

Reclassification from temporary equity

Stock-based compensation

Balance December 31, 2019

Cumulative effect adjustment for the adoption of new accounting principle (ASU 2016-13)

Other comprehensive income

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Dividends declared:

Class A common stock, $ 0.03 /share, net of forfeitures and reversal of dividend accrual for nonvested RSUs/PSUs

Class A common stock, $ 0.015 /share, net of forfeitures and reversal of dividend accrual for nonvested PSUs

Class B common stock, $ 0.015 /share

AMC preferred equity units, $ 0.015 /share

Class A common stock issuance

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Derivative asset valuation allowance adjustment

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Reclassification of derivative liability and derivative asset for Conversion Price Reset of Convertible Notes due 2026

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Class A common stock issuance to Mudrick

Wanda conversion of Class B shares to Class A shares

( 46,103,784 )

Convertible Notes due 2026 stock conversion

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( 5,666,000 )

Taxes paid for restricted unit withholdings

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Balance December 31, 2021

Other comprehensive loss

AMC Preferred Equity Units issuance

Taxes paid for restricted unit withholdings

Stock-based compensation

Balance December 31, 2022

—————————————————

(1) Share counts have been retroactively adjusted to reflect the effect of the stock split.

See Notes to Consolidated Financial Statements

AMC ENTERTAINMENT HOLDINGS, INC.

AMC ENTERTAINM ENT HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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Temporarily Suspended or Limited Operations.

Throughout the first quarter of 2020, the Company temporarily suspended theatre operations in its U.S.

During the first quarter of 2020, the Company temporarily suspended theatre operations in its U.S.

markets and International markets in compliance with local, state, and federal governmental restrictions and recommendations on social gatherings to prevent the spread of COVID-19 and as a precaution to help ensure the health and safety of the Company’s guests and theatre staff.

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A COVID-19 resurgence during the fourth quarter of 2020 resulted in additional local, state, and federal governmental restrictions and many previously reopened theatres in International markets temporarily suspended operations again.

As of March 31, 2021, the Company operated at 585 domestic theatres with limited seating capacities, representing approximately 99 % of its domestic theatres.

As of June 30, 2021, the Company operated 593 domestic theatres, representing approximately 100 % of its domestic theatres with remaining seating capacity restrictions winding down throughout the quarter.

As of September 30, 2021 and December 31, 2021, the Company operated 596 and 593 domestic theatres, respectively, representing essentially 100 % of its domestic theatres.

Total revenues for the U.S.

markets increased $ 1,049.1 million for the year ended December 31, 2021, compared to the year ended December 31, 2020.

As of March 31, 2021, the Company operated at 97 international theatres, with limited seating capacities, representing approximately 27 % of its international theatres.

As of June 30, 2021, the Company operated 335 international theatres with limited seating capacities, representing approximately 95 % of its international theatres.

The majority of international theatre operations were suspended for the first two months of the second quarter of 2021 due to a COVID-19 resurgence and did not reopen until early June 2021.

At September 30, 2021 and December 31, 2021, the Company operated 351 and 337 international theatres, respectively, representing approximately 99 % and 95 %, respectively, of its international theatres.

Total revenues for the International markets increased $ 236.4 million for the year ended December 31.

2021, compared to the year ended December 31, 2020.

As of December 31, 2021, the Company has cash and cash equivalents of approximately $ 1.6 billion.

The following table summarizes theatre operations for the Company in 2021:

September 30,

Theatre Operations:

Percentage of theatres operated - Domestic

Percentage of theatres operated - International

Percentage of theatres operated - Consolidated

During the year ended December 31, 2022, the Company operated essentially 100 % of all its U.S.

and International theatres.

As of December 31, 2022 and 2021, there were no restrictions on operations in any of the U.S.

or International theatres.

As of December 31, 2022, the Company has cash and cash equivalents of approximately $ 631.5 million and $ 211.2 million unused borrowing capacity, net of letters of credit, under the $ 225.0 million Senior Secured Revolving Credit Facility.

In response to the COVID-19 pandemic, the Company adjusted certain elements of its business strategy and took significant steps to preserve cash.

The Company is continuing to take significant measures to further strengthen its financial position and enhance its operations, by eliminating non-essential costs, including reductions to its variable costs and elements of its fixed cost structure, introducing new initiatives, and optimizing its theatrical footprint.

Additionally, the Company enhanced liquidity through debt issuances, debt exchanges and equity sales.

See Note 8 — Corporate Borrowings and Finance Lease Obligations, Note 9 — Stockholders’ Equity, and Note 16—Subsequent Events for further information.

Additionally, the Company enhanced liquidity through debt refinancing that extended maturities, purchases of debt below par value, and equity sales.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities, Note 9 — Stockholders’ Equity, and Note 16—Subsequent Events for further information.

The table below summarizes net decrease in cash and cash equivalents and restricted cash by quarter for the year ended December 31, 2022:

Three Months Ended

September 30,

(In millions)

Cash flows from operating activities:

Net cash used in operating activities

Cash flows from investing activities:

Net cash used in investing activities

Cash flows from financing activities:

Net cash provided by (used in) financing activities

Effect of exchange rate changes on cash and cash equivalents and restricted cash

Net decrease in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at beginning of period

Cash and cash equivalents and restricted cash at end of period

The Company’s net cash provided by (used in) operating activities improved by $ 341.5 million during the three months ended March 31, 2022 compared to the three months ended December 31, 2021, $ 218.4 million during the three months ended June 30, 2022 compared to the three months ended March 31, 2022, deteriorated by $( 147.0 ) million during the three months ended September 30, 2022 compared to the three months ended June 30, 2022, and improved by $ 190.3 million during the three months ended December 31, 2022 compared to September 30, 2022.

The improvement is primarily attributable to working capital changes, partially offset by an increased net loss during the three months ended December 31, 2022.

The Company has also continued to repay rent amounts that were deferred during the pandemic, which increases its cash outflows from operating activities.

See Note 3 — Leases for a summary of the estimated future repayment terms for the remaining $ 157.2 million of rentals that were deferred during the COVID-19 pandemic.

The Company’s net cash provided by (used in )investing activities included:

● $ 34.8 million of capital expenditures and $ 27.9 million of investments in non-consolidated entities, partially offset by proceeds from the disposition of long-term assets of $ 7.2 million during the three months ended March 31, 2022;

● $ 40.4 million of capital expenditures, $ 17.8 million for the acquisition of theatres, partially offset by proceeds of $ 11.4 million from the sale of securities in conjunction with the liquidation of a non-qualified deferred compensation plan during the three months ended June 30, 2022;

● $ 54.5 million of capital expenditures, partially offset by proceeds from disposition of long-term assets $ 3.6 million during the three months ended September 30, 2022;

● $ 72.3 million of capital expenditures, partially offset by $ 0.5 million of proceeds from disposition of long-term assets and $ 1.5 million of proceeds from the sale of NCM shares during the three months ended December 31, 2022.

The Company’s net cash provided by (used in) financing activities included:

● $ 955.7 million of principal and premium payments, $ 52.2 million of taxes paid for restricted unit withholdings, and $ 17.7 million of cash used to pay for deferred financing costs, partially offset by proceeds from the Company’s debt issuances of $ 950.0 million during the three months ended March 31, 2022;

● $ 57.9 million of principal and premium payments, $ 1.8 million of cash used to pay for deferred financing costs and $ 0.7 million of AMC Preferred Equity Unit issuance during the three months ended June 30, 2022;

● $ 7.4 million principal payments and $ 0.5 million of cash used to pay deferred financing costs, partially offset by $ 8.5 million of net proceeds from AMC Preferred Equity Units issuance during the three months ended September 30, 2022;

● $ 529.5 million of principal and premium payments and $ 6.9 million of cash used to pay for deferred financing costs, partially offset by proceeds from the Company’s debt issuance of $ 368.0 million and $ 212.6 million of net proceeds from AMC Preferred Equity Units issuance during the three months ended December 31, 2022.

The table below summarizes net increase (decrease) in cash equivalents and restricted cash by quarter for the year ended December 31, 2021:

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This is primarily attributable to continued increases in attendance and industry box office revenues during the year ended December 31, 2021.

The Company will continue to repay rent amounts that were deferred during the pandemic, which will increase its cash outflows from operating activities.

See Note 3 — Leases for a summary of the estimated future repayment terms for the remaining $ 315.1 million of rentals that were deferred during the COVID-19 pandemic.

The Company’s net cash provided by (used in) investing activities included:

● $( 11.9 ) million of capital expenditures and $( 9.3 ) million of investments in non-consolidated entities, partially offset by proceeds from the disposition of the Baltic theatres of $ 3.8 million and proceeds from the disposition of long-term assets of $ 1.4 million during the three months ended March 31, 2021;

● $ 31.4 million of proceeds from the disposition of the Baltic theatres, partially offset by $( 17.9 ) million of capital expenditures during the three months ended June 30, 2021;

● $( 24.1 ) million of capital expenditures, $( 5.8 ) million related to the acquisition of assets at two theatres and $( 1.0 ) million of transaction costs related to the Baltic theatres sale, partially offset by $ 2.0 million of proceeds from disposition of long-term assets during the three months ended September 30, 2021;

● $( 38.5 ) million of capital expenditures and $( 2.4 ) million related to the acquisition of assets at two theatres, partially offset by $ 4.5 million of proceeds from disposition of long-term assets during the three months ended December 31, 2021.

The Company’s net cash provided by (used in) financing activities included:

● Net proceeds from the Company’s debt and equity issuances of $ 861.9 million during the three months ended March 31, 2021;

● Net proceeds from the Company’s equity issuances of $ 1,219.6 million during the three months ended June 30, 2021;

● Principal and premium payments of $( 40.3 ) million related to an optional redemption of the Company’s First Lien Toggle Notes due 2026 during the three months ended September 30, 2021;

● Taxes paid for restricted stock withholdings of $( 19.1 ) million during the three months ended December 31, 2021.

The Company believes its existing cash and cash equivalents, together with cash generated from operations, will be sufficient to fund its operations, satisfy its obligations, including cash outflows for increased rent and planned capital expenditures, and comply with minimum liquidity and financial covenant requirements under its debt covenants related to borrowings pursuant to the Senior Secured Revolving Credit Facility and Odeon Term Loan Facility for at least the next twelve months.

In order to achieve net positive operating cash flows and long-term profitability, the Company believes it will need to continue to increase attendance levels significantly compared to 2021 and achieve levels in line with pre COVID-19 attendance.

The Company believes the global re-opening of its theatres, the anticipated volume of titles available for theatrical release, and the anticipated broad appeal of many of those titles will support increased attendance levels.

The Company believes that the sequential increases in attendance experienced each quarter as 2021 progressed are positive signs of continued demand for the moviegoing experience.

However, there remain significant risks that may negatively impact attendance, including a resurgence of COVID-19 related restrictions, potential movie-goer reluctance to attend theatres due to concerns about COVID-19 variant strains, movie studios release schedules and direct to streaming or other changing movie studio practices.

The Company entered the Ninth Amendment (as defined in Note 8 — Corporate Borrowings and Finance Lease Obligations) pursuant to which the requisite revolving lenders party thereto agreed to extend the fixed date for the termination of the suspension period for the financial covenant (the secured leverage ratio) applicable to the Senior Secured Revolving Credit Facility (as defined in Note 8 — Corporate Borrowings and Finance Lease Obligations) from March 31, 2021 to March 31, 2022, which was further extended by the Eleventh Amendment (as defined in Note 8 — Corporate Borrowings and Finance Lease Obligations) from March 31, 2022 to March 31, 2023, as described, and on the terms and conditions specified, therein.

The Company is currently subject to minimum liquidity requirements of approximately $ 144 million, of which $ 100 million is required under the conditions for the Extended Covenant Suspension Period ending March 31, 2023, as amended, under the Senior Secured Revolving Credit Facility, and £ 32.5 million (approximately $ 44 million) of which is required under the Odeon Term Loan Facility.

Following the expiration of the Extended Covenant Suspension Period ending March 31, 2023, the Company will be subject to the financial covenant under the Senior Secured Revolving Credit Facility as of the last day of each quarter on which the aggregate principal amount of revolving loans, and letters of credit (excluding letters of credit that are cash collateralized) in excess of $ 25 million, outstanding under the Senior Secured Revolving Credit Facility exceeds 35 % of the principal amount of commitments under the Senior Secured Revolving Credit Facility then in effect, beginning with the quarter ending June 30, 2023.

The Company currently expects it will be able to comply with this financial covenant, however, the Company does not anticipate the need to borrow under the Senior Secured Revolving Credit Facility during the next twelve months.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for further information.

The Company’s liquidity needs thereafter will depend, among other things, on the timing of movie releases and its ability to generate cash from operations.

The Company’s cash expenditures for rent increased significantly in the second, third, and fourth quarters of 2021 as previously deferred rent payments and landlord concessions started to become current obligations.

The Company believes its existing cash and cash equivalents, together with cash generated from operations, will be sufficient to fund its operations, satisfy its obligations, including cash outflows to repay rent amounts that were deferred during the COVID-19 pandemic and planned capital expenditures, and comply with minimum liquidity and financial covenant requirements under its debt covenants related to borrowings pursuant to the Senior Secured Revolving Credit Facility for at least the next twelve months.

In order to achieve net positive operating cash flows and long-term profitability, the Company believes that operating revenues and attendance levels will need to increase significantly from 2021 and 2022 levels to levels in line with pre-COVID-19 operating revenues.

The Company believes the anticipated volume of titles available for theatrical release, and the anticipated broad appeal of many of those titles will support increased operating revenues and attendance levels.

The Company believes that recent operating revenues attendance levels are positive signs of continued demand for the moviegoing experience.

Total revenues for the years ended December 31, 2022, 2021, and 2020 were $ 3.9 billion, $ 2.5 billion, and $ 1.2 billion, respectively, compared to $ 5.5 billion for the year ended December 31, 2019.

For the years ended December 31, 2022, 2021, and 2020 attendance was 201.0 million patrons, 128.5 million patrons, and 75.2 million patrons, respectively, compared to 356.4 million patrons for the year ended December 31, 2019.

Moreover, it is difficult to predict future operating revenues and attendance levels and there remain significant risks that may negatively impact operating revenues and attendance, including movie studios release schedules, the production and theatrical release of fewer films compared to levels before the onset of the COVID-19 pandemic, and direct to streaming or other changing movie studio practices.

The Company entered the Ninth Amendment pursuant to which the requisite revolving lenders party thereto agreed to extend the fixed date for the termination of the suspension period for the financial covenant (the secured leverage ratio) applicable to the Senior Secured Revolving Credit Facility from March 31, 2021 to March 31, 2022, which was further extended by the Eleventh Amendment and the Twelfth Amendment from March 31, 2022 to March 31, 2023, and then from March 31, 2023 to March 31, 2024, respectively, in each case, as described, and on the terms and conditions specified, therein.

As of December 31, 2022, the Company was subject to a minimum liquidity requirement of $ 100 million as a condition to the Extended Covenant Suspension Period (as defined in Note 8—Corporate Borrowings and Finance Lease Liabilities in the Notes to the Consolidated Financial Statements under Part II, Item 8 thereof).

The current maturity date of the Senior Secured Revolving Credit Facility is April 22, 2024;

since the financial covenant applicable to the Senior Secured Revolving Credit Facility is tested as of the last day of any fiscal quarter for which financial statements have been (or were required to have been) delivered, the financial covenant has been effectively suspended through maturity of the Senior Secured Revolving Credit Facility.

The 11.25 % Odeon Term Loan Facility due 2023 (“Odeon Term Loan Facility”) was to mature on August 19, 2023, during the third fiscal quarter of the Company’s next calendar year.

On October 20, 2022, the Company completely repaid the Odeon Term Loan Facility using existing cash and $ 363.0 million net proceeds from the issuance of Odeon Notes due 2027.

The Company may, at any time and from time to time, seek to retire or purchase debt through cash purchases and/or exchanges for equity (including AMC Preferred Equity Units) or debt, in open-market purchases, privately negotiated transactions or otherwise.

Such repurchases or exchanges, if any, will be upon such terms and at such prices as it may determine, and will depend on prevailing market conditions, its liquidity requirements, contractual restrictions and other factors.

The amounts involved may be material and to the extent equity is used, dilutive.

During the year ended December 31, 2022, the Company repurchased $ 118.3 million aggregate principal of the Second Lien Notes due 2026 for $ 68.3 million and recorded a gain on extinguishment of $ 75.0 million in other expense (income).

Additionally, during the year ended December 31, 2022, the Company repurchased $ 5.3 million aggregate principal of the Senior Subordinated Notes due 2027 for $ 1.6 million and recorded a gain on extinguishment of $ 3.7 million in other expense (income).

Accrued interest of $ 4.5 million was paid in connection with the repurchases.

See Note 8—Corporate Borrowings and Finance Lease Liabilities for more information.

The Company received rent concessions provided by the lessors that aided in mitigating the economic effects of COVID-19 during the pandemic.

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As a result, deferred lease amounts were approximately $ 157.2 million as of December 31, 2022.

See Note 3 — Leases for a summary of the estimated future repayment terms for the deferred lease amounts due to COVID-19.

Including repayments of deferred lease amounts, the Company’s cash expenditures for rent increased significantly during the year ended December 31, 2022 compared to the year ended December 31, 2021.

See Note 3 — Leases for a summary of the estimated future repayment terms for the deferred lease amounts due to COVID-19 and also a summary of the estimated future repayment terms for the minimum operating lease and finance lease amounts.

It is very difficult to estimate the Company’s liquidity requirements, future cash burn rates, future operating revenues, and attendance levels.

Depending on the Company’s assumptions regarding the timing and ability to achieve significantly increased levels of operating revenue, the estimates of amounts of required liquidity vary significantly.

In order to achieve net positive operating cash flows and long-term profitability, the Company believes that operating revenues will need to increase significantly to levels in line with pre-COVID-19 operating revenues.

The Company’s current cash burn rates are not sustainable.

Further, the Company cannot accurately predict what future changes may occur to the supply or release date of movie titles available for theatrical exhibition once moviegoers are prepared to return in large numbers.

Nor can the Company know with certainty the impact on consumer movie-going behavior of studios who release movies to theatrical exhibition and their streaming platforms on the same date, or the potential attendance impact of other studio decisions to accelerate in-home availability of their theatrical movies.

Studio negotiations regarding evolving theatrical release models and film licensing terms are ongoing.

There can be no assurance that the operating revenues, attendance levels, and other assumptions used to estimate our liquidity requirements and future cash burn rates will be correct, and our ability to be predictive is uncertain due to limited ability to predict studio film release dates and success of individual titles.

Further, there can be no assurances that the Company will be successful in generating the additional liquidity necessary to meet the Company’s obligations beyond twelve months from the issuance of these financial statements on terms acceptable to the Company or at all.

If the Company is unable to maintain or renegotiate our minimum liquidity covenant requirements, it could have a significant adverse effect on the Company’s business, financial condition and operating results.

AMC Preferred Equity Units.

On August 4, 2022, the Company announced that its Board of Directors declared a special dividend of one AMC Preferred Equity Unit (an “AMC Preferred Equity Unit”) for each share of Class A common stock outstanding at the close of business August 15, 2022, the record date.

The dividend was paid at the close of business August 19, 2022 to investors who held Class A common shares as of August 22, 2022, the ex-dividend date.

Each AMC Preferred Equity Unit is a depositary share and represents an interest in one one-hundredth (1/100th) of a share of Series A Convertible Participating Preferred Stock evidenced by a depositary receipt pursuant to a deposit agreement.

The Company has 50,000,000 Preferred Stock shares authorized, 10,000,000 of which have currently been allocated and 7,245,872 have been issued under the depositary agreement as Series A Convertible Participating Preferred Stock, leaving 40,000,000 unallocated Preferred Stock shares.

Each AMC Preferred Equity Unit is designed to have the same economic and voting rights as a share of Class A common stock.

Trading of the AMC Preferred Equity Units on the NYSE began on August 22, 2022 under the ticker symbol “APE”.

Due to the characteristics of the AMC Preferred Equity Units, the special dividend had the effect of a stock split pursuant to ASC 505-20-25-4.

Accordingly, all references made to share, per share or common share amounts in the accompanying consolidated financial statements and applicable disclosures have been retroactively adjusted to reflect the effects of the special stock dividend as a stock split.

See Note 9–Stockholders’ Equity and Note 15–Loss Per Share.

Use of Estimates.

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Majority-owned subsidiaries that the Company has control of are consolidated in the Company’s consolidated subsidiaries;

consequently, a portion of its stockholders’ equity, net earnings (loss) and total comprehensive

income (loss) for the periods presented are attributable to noncontrolling interests.

consequently, a portion of its stockholders’ equity, net earnings (loss) and total comprehensive income (loss) for the periods presented are attributable to noncontrolling interests.

The Company manages its business under two reportable segments for its theatrical exhibition operations, U.S.

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The online ticket fee revenues and the third-party commission or service fees are recorded in the line items other theatre revenues and operating expense, respectively, in the consolidated statements of operations.

The Company recognizes government grants once the grant requirements have been met.

Grants relating to specific costs are treated as a reduction of that cost in the consolidated statements of operations.

General grants are recorded within other expense (income).

Grants related to the construction of fixed assets are treated as reductions to the associated fixed asset cost.

Certain grants contain stipulations around the use of funds which could trigger claw backs if the stipulations are violated.

Film Exhibition Costs.

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markets which allows members to earn rewards, receive discounts and participate in exclusive members-only offerings and services.

It features both a paid tier called AMC Stubs Premiere TM for a flat annual membership fee and a non-paid tier called AMC Stubs ® Insider TM .

It features both a paid tier called AMC Stubs Premiere TM for a flat annual membership fee and a non-paid tier called AMC

Stubs ® Insider TM .

Both programs reward loyal guests for their patronage of AMC Theatres.

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As the Company re-opened theatres, A-List members had the option to reactivate their subscription, which restarted the monthly charge for the program.

Starting in July of 2021, all A-List monthly subscriptions were automatically reactivated and the Company has

resumed a more normal recognition pattern for deferred revenues related to certain loyalty programs, gift cards and exchange tickets.

Starting in July of 2021, all A-List monthly subscriptions were automatically reactivated and the Company has resumed a more normal recognition pattern for deferred revenues related to certain loyalty programs, gift cards and exchange tickets.

Advertising Costs.

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Advertising costs were $ 28.0 million, $ 28.4 million, and $ 10.7 million for the years ended December 31, 2022, December 31, 2021, and December 31, 2020, respectively, and are recorded in operating expense in the accompanying consolidated statements of operations.

Cash and Equivalents.

Cash and Cash Equivalents.

All highly liquid debt instruments and investments purchased with an original maturity of three months or less are classified as cash equivalents.

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Restricted cash is cash held in the Company's bank accounts in International markets as a guarantee for certain landlords.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Consolidated Balance Sheet to the total of the amounts in the Consolidated Statements of Cash Flows.

December 31, 2022

December 31, 2021

December 31, 2020

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash in the statement of cash flows

Derivative Asset and Liability.

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The Company’s Common Stock price at the end of each reporting period as well as the remaining amount of time until expiration for the contingent call option and conversion feature were key inputs for the estimation of fair value that were expected to change each reporting period.

The Company recorded other expense (income) related to derivative asset fair value adjustments of $ 0 , $ 19.6 million and $ 17.7 million, during the years ended December 31, 2021, December 31, 2020 and December 31, 2019, respectively, and other expense (income) related to derivative liability fair value adjustments of $ 0 , $ 89.4 million, and $( 23.5 ) million, during the years ended December 31, 2021, December 31, 2020 and December 31, 2019, respectively.

See Note 8 — Corporate Borrowings and Finance Lease Obligations and Note 9 — Stockholders’ Equity for further discussions.

The Company recorded other expense (income) related to derivative asset fair value adjustments of $ 0 million, $ 0 million and $ 19.6 million, during the years

ended December 31, 2022, December 31, 2021 and December 31, 2020, respectively, and other expense (income) related to derivative liability fair value adjustments of $ 0 million, $ 0 million, and $ 89.4 million, during the years ended December 31, 2022, December 31, 2021 and December 31, 2020, respectively.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities and Note 9 — Stockholders’ Equity for further discussions.

Intangible Assets.

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Gains and losses related to non-cash negative common unit adjustments are recorded using the weighted average cost of those units in NCM.

See Note 6 — Investments for further discussion of

the Company’s investments in NCM.

See Note 6 — Investments for further discussion of the Company’s investments in NCM.

As of December 31, 2022, the Company holds equity method investments comprised of a 18.3 % interest in SV Holdco LLC (“SV Holdco”), a joint venture that markets and sells cinema advertising and promotions through Screenvision;

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a 32.0 % interest in AC JV, LLC (“AC JV”), a joint venture that owns Fathom Events offering alternative content for motion picture screens;

a 29.0 % interest in Digital Cinema Implementation Partners, LLC (“DCIP”), a joint venture charged with implementing digital cinema in the Company’s theatres;

a 14.6 % interest in Digital Cinema Distribution Coalition, LLC (“DCDC”), a satellite distribution network for feature films and other digital cinema content;

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If an impairment analysis is needed, the Company performs a quantitative impairment test for goodwill, which involves estimating the fair value of the reporting unit and comparing that value to its carrying value.

If the estimated fair value of the reporting unit is less than its carrying value, the difference is recorded as goodwill impairment charge, not to exceed the total amount of goodwill allocated to that reporting unit.

Qualitative impairment tests performed during 2021 .

The Company performed a qualitative impairment test to evaluate whether it is more likely than not that the fair value of its two reporting units was less than their respective carrying amounts as of its annual assessment date.

The Company concluded that it was not more likely than not that the fair value of either of the Company’s two reporting units had been reduced below their respective carrying amounts.

As a result, the Company concluded that there were no triggering events as of the annual assessment date, December 31, 2021.

If the estimated fair value of the reporting unit is less than its carrying value, the

difference is recorded as goodwill impairment charge, not to exceed the total amount of goodwill allocated to that reporting unit.

Qualitative impairment tests .

The Company performed a qualitative impairment test to evaluate whether it is more likely than not that the fair value of each reporting unit was less than their respective carrying amount as of its annual assessment date, October 1st.

The Company concluded that it was not more likely than not that the fair value of either of the Company’s two reporting units had been reduced below their respective carrying amounts at the annual assessment date for 2021 or 2022.

The Company concluded that there were no triggering events that had occurred between the annual assessment date and December 31, 2022.

Step 1 quantitative goodwill impairment tests performed during 2020.

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The amount of these checks included in accounts payable as of December 31, 2022 and December 31, 2021 was $ 2.2 million and $ 3.6 million, respectively.

The Company adopted ASC 842 on January 1, 2019 using the modified retrospective transition method.

Upon transition to the new standard, the Company elected the package of practical expedients, which permitted the Company not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs.

The Company leases theatres and equipment under operating and finance leases.

The majority of the Company’s operations are conducted in premises occupied under lease agreements with initial base terms ranging generally from 12 to 15 years , with certain leases containing options to extend the leases for up to an additional 20 years .

The Company typically does not believe that exercise of the renewal options is reasonably assured at the inception of the lease agreements and, therefore, considers the initial base term as the lease term.

The Company typically does not believe that the exercise of the renewal options is reasonably assured at the inception of the lease agreements and, therefore, considers the initial base term as the lease term.

Lease terms vary but generally, the leases provide for fixed and escalating rentals, contingent escalating rentals based on the Consumer Price Index and other indexes not to exceed certain specified amounts and variable rentals based on a percentage of revenues.

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The Company identifies impairments related to internal use software when management determines that the remaining carrying value of the software will not be realized through future use.

The Company evaluates events or circumstances, including competition in the markets

where it operates, that would indicate the carrying value of theatre assets may not be fully recoverable.

The Company evaluates events or circumstances, including competition in the markets where it operates, that would indicate the carrying value of the asset groups may not be fully recoverable.

If an event or circumstance is identified indicating carrying value may not be recoverable, the sum of future undiscounted cash flows is compared to the carrying value.

If the carrying value exceeds the future undiscounted cash flows, the carrying value of the asset is reduced to fair value, with the difference recorded as an impairment charge.

Assets are evaluated for impairment on an individual theatre basis, which management believes is the lowest level for which there are identifiable cash flows.

If the carrying value exceeds the future undiscounted cash flows, the asset group may be impaired.

Asset groups are evaluated for impairment on an individual theatre basis, which management believes is the lowest level for which there are identifiable cash flows.

The Company evaluates theatres using historical and projected data of theatre level cash flow as its primary indicator of potential impairment and considers the seasonality of its business when making these evaluations.

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During the year ended December 31, 2022, the Company recorded non-cash impairment of long-lived assets of $ 73.4 million on 68 theatres in the U.S.

markets with 805 screens (in Alabama, Arkansas, California, Colorado, Connecticut, District of Columbia, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Minnesota, Mississippi, Missouri, Montana, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, West Virginia, and Wisconsin) and $ 15.9 million on 14 theatres in the International markets with 118 screens (in Italy, Norway, Spain, and the UK), which were related to property, net, operating lease right-of-use assets, net, and other long-term assets.

markets with 817 screens (in Alabama, Arkansas, Arizona, California, Connecticut, District of Columbia, Florida, Georgia, Iowa, Illinois, Indiana, Kentucky, Louisiana, Massachusetts, Maryland, Michigan, Minnesota, Missouri, North Carolina, North Dakota, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Utah, West Virginia, and Wisconsin) and $ 59.7 million on 53 theatres in the International markets with 456 screens (in Germany, Italy, Spain, Sweden, and the UK), which were related to property, net and operating lease right-of-use assets, net.

During the year ended December 31, 2021, the Company recorded non-cash impairment of long-lived assets of $ 61.3 million on 77 theatres in the U.S.

markets with 1,139 screens (in Alabama, Arizona, Arkansas, California, Colorado, District of Columbia, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Dakota, Tennessee, Texas, Washington, Wisconsin and Wyoming) and $ 25.4 million on 37 theatres in the International markets with 340 screens (in Finland, Germany, Ireland, Italy, Norway, Portugal, Spain, Sweden, and UK), which were related to property, net and operating lease right-of-use assets, net.

markets with 805 screens and $ 15.9 million on 14 theatres in the International markets with 118 screens, which were related to property, net and operating lease right-of-use assets, net.

During the year ended December 31, 2020, the Company recorded non-cash impairment of long-lived assets of $ 152.2 million on 101 theatres in the U.S.

markets with 1,139 screens and $ 25.4 million on 37 theatres with 340 screens, which were related to property, net and operating lease right-of-use assets, net.

During the year ended December 31, 2020, the Company recorded impairment losses related to definite-lived intangible assets of $ 14.4 million in the U.S.

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In addition, during the year ended December 31, 2020, the Company recorded impairment losses of $ 15.9 million within investment expense (income), related to equity interest investments without a readily determinable fair value accounted for under the cost method in the U.S.

During the year ended December 31, 2019, the Company recorded an impairment of long-lived assets loss of $ 76.6 million on 40 theatres in the U.S.

markets with 512 screens and an impairment of long-lived assets loss of $ 7.7 million on 14 theatres with 148 screens in the International markets, which was related to property held and used, operating lease right-of-use assets, and a U.S.

property held and not used in other long-term assets.

In addition, the Company recorded an impairment loss of $ 3.6 million within investment expense (income), related to an equity interest investment without a readily determinable fair value accounted for under the cost method.

Foreign Currency Translation.

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The resultant translation adjustments are included in foreign currency translation adjustment, a separate component of accumulated other comprehensive income (loss).

Gains and losses from foreign currency transactions are included in net earnings (loss), except those intercompany transactions of a long-term investment nature, and also the Company’s £ 4.0 million, 6.375 % Senior Subordinated Notes due 2024, which have been designated as a non-derivative net investment hedge of the Company’s investment in Odeon and UCI Cinemas Holdings Limited (“Odeon”).

Gains and losses from foreign currency transactions are included in net earnings (loss), except those intercompany transactions of a long-term investment nature.

If the Company substantially liquidates its investment in a foreign entity, any gain or loss on currency translation or transaction balance recorded in accumulated other comprehensive loss is recorded as part of a gain or loss on disposition.

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and frozen defined benefit pension plans in the U.K.

The Company also sponsors a postretirement deferred compensation plan, which was terminated on May 3, 2021 and will be liquidated in 2022, and also a defined contribution plan.

The Company also sponsors a postretirement deferred compensation plan, which was terminated on May 3, 2021 and liquidated during 2022, and also various defined contribution plans.

The following table sets forth the plans’ benefit obligations and plan assets and the accrued liability for benefit costs included in the consolidated balance sheets:

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The non-operating component of net periodic benefit costs is recorded in other expense (income) in the consolidated statements of operations.

During the years ended December 31, 2020 and December 31, 2019, before the Sweden pension benefit plan was frozen, the service cost component of net periodic benefit cost was recorded in general and administrative other.

During the year ended December 31, 2020, before the Sweden pension benefit plan was frozen, the service cost component of net periodic benefit cost was recorded in general and administrative other.

The following table provides the benefits expected to be paid in each of the next five years, and in the aggregate for the five years thereafter:

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investment portfolio, 90 % were valued using the net asset value per share (or its equivalent) as a practical expedient and 10 % of the investment included pooled separate accounts valued using market prices for the underlying instruments that were observable in the market or could be derived by observable market data from independent external valuation information (Level 2 of the fair value hierarchy).

As of December 31, 2021, for the International investment portfolio 37 % included mutual funds and collective trust funds valued using market prices for the underlying instruments that were observable in the market or could be derived by observable market data from independent external valuation information (Level 2 of the fair value hierarchy) and 63 % were valued using the net asset value per share (or its equivalent) as a practical expedient.

As of December 31, 2022, for the International investment portfolio 1 % consisting of cash and equivalents was valued using quoted market prices from actively traded markets (Level 1 of the fair value hierarchy), 38 % included mutual funds and collective trust funds valued using market prices for the underlying instruments that were observable in the market or could be derived by observable market data from independent external valuation information (Level 2 of the fair value hierarchy) and 61 % were valued using the net asset value per share (or its equivalent) as a practical expedient.

Under the defined contribution plan, the Company sponsors a voluntary 401(k) savings plan covering certain U.S.

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Casualty insurance expense is recorded in operating expense.

Government Assistance.

The Company recognizes government assistance when the conditions of the grant have been met and there is reasonable assurance that the assistance will be received.

Grants relating to specific costs are treated as a reduction of that cost in the consolidated statement of operations.

General grants are recorded within other expense (income).

Grants related to the construction of long-lived assets are treated as reductions to the cost of the associated assets.

During the year ended December 31, 2022 the Company recognized government assistance in other income of $ 25.8 million, primarily related to grants in Italy and Germany.

The general requirements of the grants were that the grantees must have lost income due to the COVID-19 pandemic.

In Germany, the grants can potentially be subject to a final audit, however the Company believes the risk of claw-back is remote and therefore have recognized the entire award received.

Additionally, the Company recognized $ 1.9 million of government assistance as reduction to property, net during the twelve months ended December 31, 2022.

The assistance relates to the construction of capital assets related to the innovation, modernization, and digitalization of the theatrical exhibition industry.

Other Expense (Income):

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Governmental assistance due to COVID-19 - U.S.

Foreign currency transaction (gains) losses

Foreign currency transaction gains

Non-operating components of net periodic benefit cost (income)

Loss on debt extinguishment

Loss on extinguishment - First Lien Notes due 2025

Loss on extinguishment - First Lien Notes due 2026

Loss on extinguishment - First Lien Toggle Notes due 2026

Gain on extinguishment - Second Lien Notes due 2026

Gain on extinguishment - Senior Subordinated Notes due 2027

Loss on debt extinguishment - Odeon Term Loan Facility

Financing fees related to modification of debt

Loss on Pound sterling forward contract

Business interruption insurance recoveries

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Accounting Pronouncements Recently Adopted

Income Taxes.

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which is intended to improve consistency and simplify several areas of existing guidance.

ASU 2019-12 removes certain exceptions to the general principles related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences.

The new guidance also clarifies the accounting for transactions that result in a step-up in the tax basis for goodwill.

ASU 2019-12 was effective for the Company in the first quarter of 2021.

The adoption of ASU 2019-12 did not have a material impact on the Company’s consolidated financial statements.

Accounting Pronouncements Issued Not Yet Adopted

Government Assistance.

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) Disclosures by Business Entities about Government Assistance (“ASU 2021-10”).

In November 2021, the FASB issued Accounting Standards Update (“ASU”) No.

2021-10, Government Assistance (Topic 832) Disclosures by Business Entities about Government Assistance (“ASU 2021-10”).

The amendments in ASU 2021-10 require annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy, including (1) information about the nature of the transactions and the related accounting policy used to account for the transactions, (2) the line items on the balance sheet and income statement that are affected by the transactions and the amounts applicable to each financial statement line item, and (3) significant terms and conditions of the transactions, including commitments and contingencies.

The annual government assistance disclosure requirements are effective for the Company during the year ended December 31, 2022.

On January 1, 2022, the Company adopted ASU 2021-10.

See Note 1 for further information regarding government assistance.

Accounting Pronouncements Issued Not Yet Adopted

NOTE 2—REVENUE RECOGNITION

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Balance December 31, 2022

(1) Includes movie tickets, food and beverage, gift cards, exchange tickets, and AMC Stubs ® loyalty membership fees.

(1) Includes movie tickets, food and beverage, gift cards, exchange tickets, and AMC Stubs ® and other loyalty membership fees.

(2) Amount of rewards accumulated, net of expirations, that are attributed to AMC Stubs ® and other loyalty programs.

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Balance December 31, 2020

Common Unit Adjustment–additions of common units (1)

Negative Common Unit Adjustment–reduction of common units (1)

Reclassification of the beginning balance to other theatre revenue, as the result of performance obligations satisfied

Balance December 31, 2021

Negative Common Unit Adjustment–reduction of common units

Common Unit Adjustment–additions of common units

Reclassification of portion of the beginning balance to other theatre revenue, as the result of performance obligations satisfied

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NOTE 3—LEASES

The Company leases theatres and equipment under operating and finance leases.

The Company typically does not believe that exercise of the renewal options is reasonably certain at the lease commencement and, therefore, considers the initial base term as the lease term.

Lease terms vary but generally the leases provide for fixed and escalating rentals, contingent escalating rentals based on the Consumer Price Index and other indexes not to exceed certain specified amounts and variable rentals based on a percentage of revenues.

The Company often receives contributions from landlords for renovations at existing locations.

The Company records the amounts received from landlords as an adjustment to the right-of-use asset and amortizes the balance as a reduction to rent expense over the base term of the lease agreement.

Equipment leases primarily consist of food and beverage equipment.

The Company received rent concessions provided by the lessors that aided in mitigating the economic effects of COVID-19 during the pandemic.

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(1) During the year ended December 31, 2022, the decrease in fixed operating lease deferred amounts includes $ 144.6 million of decreases in the deferred balances as of December 31, 2021 related to payments and abatements.

(2) During the year ended December 31, 2021, decreases in variable lease deferred amounts were primarily due to resolution of contingencies, therefore, variable amounts became fixed and were reclassified to fixed operating lease deferred amounts.

The following table reflects the lease costs for the years indicated below:

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Lease Payments

Three months ended March 31, 2022

Three months ended June 30, 2022

Three months ended September 30, 2022

Three months ended December 31, 2022

Total deferred lease amounts recorded in AP

Twelve months ended December 31, 2023

(2) The minimum annual payments table above includes deferred undiscounted cash rent amounts that were due and not paid related to operating and finance leases, as shown below:

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(In millions)

Three months ended March 31, 2022

Three months ended June 30, 2022

Three months ended September 30, 2022

Three months ended December 31, 2022

Total deferred lease amounts

As of December 31, 2021, the Company had signed additional operating lease agreements for 7 theatres that have not yet commenced of approximately $ 165.2 million, which are expected to commence between 2022 and 2024, and carry lease terms of approximately 5 to 20 years .

As of December 31, 2022, the Company had signed additional operating lease agreements for three theatres that have not yet commenced of approximately $ 78.9 million, which are expected to commence between 2023 and 2024, and carry lease terms of approximately 10 to 20 years .

The timing of lease commencement is dependent on the landlord providing the Company with control and access to the related facility.

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The Company uses the straight-line method in computing depreciation and amortization for financial reporting purposes.

The estimated useful lives for leasehold improvements and buildings subject to a ground lease reflect the shorter of the expected useful lives of the assets or the base terms of the corresponding lease agreements plus renewal options expected to be exercised for these leases for assets placed in service subsequent to the lease inception.

The estimated useful lives for leasehold improvements and buildings subject to a ground lease reflect the shorter of the expected useful lives of the assets or the base terms of the corresponding lease agreements for these leases for assets placed in service subsequent to the lease inception.

The estimated useful lives are as follows:

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The following table summarizes the changes in goodwill by reporting unit:

(In millions)

International

Balance December 31, 2019

Impairment adjustment March 31, 2020

Impairment adjustment September 30, 2020

Impairment adjustment December 31, 2020

Baltics disposition-Latvia (1)

Currency translation adjustment

Consolidated Goodwill

(In millions)

Gross Carrying Amount

Accumulated Impairment Losses

Net Carrying Amount

Gross Carrying Amount

Accumulated Impairment Losses

Net Carrying Amount

Gross Carrying Amount

Accumulated Impairment Losses

Net Carrying Amount

Balance December 31, 2020

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Balance December 31, 2021

Currency translation adjustment

Balance December 31, 2022

(1) See Note 1 — The Company and Significant Accounting Policies for further information regarding the Baltic theatre sale.

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Investments in non-consolidated affiliates and certain other investments accounted for under the equity method generally include all entities in which the Company or its subsidiaries have significant influence, but not more than 50 % voting control, and are recorded in the consolidated balance sheets in other long-term assets.

Investments in non-consolidated affiliates as of December 31, 2021, include interests in DCIP of 29.0 %, DCDC of 14.6 %, AC JV, owner of Fathom Events, of 32.0 %, SV Holdco, owner of Screenvision, of 18.3 %, DCM of 50.0 %, and SCC of 10.0 %.

Investments in non-consolidated affiliates as of December 31, 2022, include interests in DCDC of 14.6 %, AC JV, owner of Fathom Events, of 32.0 %, SV Holdco, owner of Screenvision, of 18.3 %, DCM of 50.0 %, and SCC of 10.0 %.

The Company also has partnership interests in three U.S.

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Indebtedness held by equity method investees is non-recourse to the Company.

Investment in Hycroft

On March 14, 2022, the Company purchased 23.4 million units of Hycroft Mining Holding Corporation (NASDAQ:

HYMC) (“Hycroft”) for $ 27.9 million, with each unit consisting of one common share of Hycroft and one common share purchase warrant.

The units were priced at $ 1.193 per unit.

Each warrant is exercisable for one common share of Hycroft at a price of $ 1.068 per share over a 5-year term through March 2027.

Hycroft filed a resale registration statement to register the common shares and warrant shares for the sale under Securities Act on April 14, 2022 which became effective on June 2, 2022.

The Company accounts for the common shares of Hycroft under the equity method and we have elected the fair value option in accordance with ASC 825-10.

The Company account for the warrants as derivatives in accordance with ASC 815.

Accordingly, the fair value of the investments in Hycroft are remeasured at each subsequent reporting period and unrealized gains and losses are reported in investment income.

During the year ended December 31, 2022, the Company recorded unrealized losses related to the investment in Hycroft of $ 6.3 million in investment expense (income), respectively.

NCM Transactions

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(“NCM, Inc.”) of $ 3.46 on March 12, 2020.

In March 2020, the NCM CUA resulted in a positive adjustment of 1,390,566 common units for the Company.

The Company received the units and recorded the common units as an addition to deferred revenues for the ESA at fair value of $ 4.8 million, based upon a price per share of National CineMedia, Inc.

(“NCM, Inc.”) of $ 3.46 on March 12, 2020.

In March 2021, the NCM CUA resulted in a negative adjustment of 3,012,738 common units for the Company, and therefore, the Company paid NCM cash of $ 9.2 million and recorded the amount as a reduction to deferred revenues for the ESA.

During the year ended December 31, 2021, the Company sold its remaining approximately 1.4 million NCM shares and received net proceeds of $ 5.7 million, which were recorded in investment expense (income).

In March 2022, the NCM CUA resulted in a positive adjustment of 5,954,646 common units for the Company.

The Company received the units and recorded the common units as an addition to deferred revenues for the ESA at a fair value of $ 15.0 million, based upon a price per share of NCM, Inc.

of $ 2.52 on March 30, 2022.

During the year ended December 31, 2022, the Company sold its shares of NCM, Inc.

for $ 1.5 million and recorded a realized loss in investment expense of $ 13.5 million.

See Note 1 — The Company and Significant Accounting Policies and Note 2 — Revenue Recognition for further information regarding CUA and ESA.

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During the year ended December 31, 2020, the Company received distributions from DCIP of digital projectors it had been leasing with an estimated fair value of $ 125.2 million, which the Company recorded as a reduction to its investment in DCIP.

The distribution reduced the Company’s recorded investment below $ 0 and therefore the Company recorded equity in earnings of $ 5.1 million to increase its investment to $ 0 as the Company has not guaranteed any of the liabilities of DCIP.

The Company will not record its share of any equity in earnings of DCIP until such time as the excess distribution amount recorded to earnings has been satisfied with prospective earnings from DCIP.

DCIP ceased operations

during the year ended December 31, 2022.

The Company received a liquidation distribution of $ 3.4 million from DCIP, which the Company recorded as equity in earnings.

The Company will record any future liquidation distributions to equity in earnings.

AC JV Transactions

On December 26, 2013, the Company amended and restated its existing ESA with NCM in connection with the spin-off by NCM of its Fathom Events business to AC JV, a newly-formed company owned 32 % by each of the Founding Members and 4 % by NCM.

In consideration for the spin-off, NCM received a total of $ 25.0 million in promissory notes from its Founding Members (approximately $ 8.3 million from each Founding Member).

Interest on the promissory note is at a fixed rate of 5 % per annum, compounded annually.

Interest and principal payments were due annually in six equal installments commencing on the first anniversary of the closing.

The Company paid the sixth and final annual installment related to the promissory note in December 2019.

AC JV distributes alternative content to theatre exhibitors.

As of December 31, 2019, Cinemark and Regal also amended and restated their respective ESAs with NCM in connection with the spin-off.

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These Digital ESAs were then assigned by NCM to AC JV as part of the Fathom spin-off.

SV Holdco (“Screenvision”)

The Company acquired its investment in SV Holdco on December 21, 2016, in connection with the acquisition of Carmike.

SV Holdco is a holding company that owns and operates the Screenvision advertising business through a subsidiary entity.

SV Holdco has elected to be taxed as a partnership for U.S.

federal income tax purposes.

Summary Financial Information

Investments in non-consolidated affiliates accounted for under the equity method as of December 31, 2021, include interests in SV Holdco, DCM, DCIP, AC JV, DCDC, SCC, 57 theatres in Europe, three U.S.

Investments in non-consolidated affiliates accounted for under the equity method as of December 31, 2022, include interests in Hycroft, SV Holdco, DCM, AC JV, DCDC, SCC, 57 theatres in Europe, three U.S.

motion picture theatres, and other immaterial investments.

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Operating costs and expenses

Net earnings (loss)

The components of the Company’s recorded equity in earnings (loss) of non-consolidated entities are as follows:

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Loan receivable from DCM

Due from DCIP for warranty expenditures

Due to AC JV for Fathom Events programming

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Pension asset

Prepaid commitment fee and deferred charges (1)

Investment in Hycroft common stock (1)

Investment in Hycroft warrants (1)

Accrued expenses and other liabilities:

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Contingent lease liabilities

(1) During the year ended December 31, 2021, the Company reclassified the prepaid commitment fee and deferred charges of $ 28.6 million to corporate borrowings from other long-term assets.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for further information.

NOTE 8—CORPORATE BORROWINGS AND FINANCE LEASE OBLIGATIONS

A summary of the carrying value of corporate borrowings and finance lease obligations is as follows:

(1) The equity method investment in Hycroft and related warrants are measured at fair value.

See Note 6—Investments and Note 12—Fair Value Measurements for further information regarding the investment in Hycroft.

NOTE 8—CORPORATE BORROWINGS AND FINANCE LEASE LIABILITIES

A summary of the carrying value of corporate borrowings and finance lease liabilities is as follows:

(In millions)

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Senior Secured Credit Facility-Term Loan due 2026 ( 7.274 % as of December 31, 2022)

Senior Secured Credit Facility-Revolving Credit Facility due 2024

10.75 % in Year 1, 11.25 % thereafter Cash/PIK Odeon Term Loan Facility due 2023 (£ 147.6 million and € 312.2 million par value as of December 31, 2021)

Odeon Revolving Credit Facility due 2022

12.75 % Odeon Senior Secured Notes due 2027

7.5 % First Lien Notes due 2029

2.95 % Senior Secured Convertible Notes due 2026

10.5 % First Lien Notes due 2025

10.5 % First Lien Notes due 2026

15 %/ 17 % Cash/PIK Toggle First Lien Secured Notes due 2026

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6.125 % Senior Subordinated Notes due 2027

Finance lease obligations

Paid-in-kind interest

Total principal amount of corporate borrowings

Finance lease liabilities

Deferred financing costs

Net premium (1)

Total carrying value of corporate borrowings and finance lease liabilities

Current maturities corporate borrowings

Current maturities finance lease obligations

Total noncurrent carrying value of corporate borrowings and finance lease liabilities

(1) The following table provides the net premium (discount) amounts of corporate borrowings:

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10 %/ 12 % Cash/PIK/Toggle Second Lien Subordinated Notes due 2026

2.95 % Senior Secured Convertible Notes due 2026

15 %/ 17 % Cash/PIK Toggle First Lien Secured Notes due 2026

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10.75 % in Year 1, 11.25 % thereafter Cash/PIK Odeon Term Loan Facility due 2023

12.75 % Odeon Senior Secured Notes due 2027

6.375 % Senior Subordinated Notes due 2024

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Odeon Secured Debt

Odeon Senior Secured Notes due 2027.

On October 20, 2022, Odeon Finco PLC, a direct subsidiary of Odeon Cinemas Group Limited (“OCGL”) and an indirect subsidiary of the Company issued $ 400.0 million aggregate principal amount of its 12.75 % Odeon Senior Secured Notes due 2027 (“Odeon Notes due 2027”), at an issue price of 92.00 %.

The Odeon Notes due 2027 bear a cash interest rate of 12.75 % per annum and will be payable semi-annually in arrears on May 1 and November 1, beginning on May 1, 2023.

The Odeon Notes due 2027 are guaranteed on a senior secured basis by certain subsidiaries of Odeon and by Holdings on a standalone and unsecured basis.

The Odeon Notes due 2027 contain covenants that limit Odeon and certain subsidiaries’ ability to, among other things:

(i) incur additional indebtedness of guarantee indebtedness;

(ii) create liens;

(iii) declare or pay dividends, redeem stock or make other distributions to stockholders;

(iv) make investments;

(v) enter into transactions with affiliates;

(vi) consolidate, merge, sell or otherwise dispose of all or substantially all of their respective assets;

and (vii) impair the security interest in the collateral.

These covenants are subject to a number of important limitations and exceptions.

The Company used the $ 363.0 million net proceeds from the Odeon Notes due 2027 and $ 146.7 million of existing cash to fund the repayment in full of the £ 147.6 million and € 312.2 million ($ 167.7 million and $ 308.9 million, respectively using October 20, 2022 exchange rates) aggregate principal amounts of the Odeon Term Loan Facility and to pay related accrued interest, fees, costs, premiums and expenses.

The Company recorded a loss on debt extinguishment related to this transaction of $ 36.5 million in other expense during the year ended December 31, 2022.

Prior to November 1, 2024, up to 35 % of the original aggregate principal amount of the Odeon Notes due 2027 may be redeemed at a price of 112.75 % of the principal thereof with the net proceeds of one or more certain equity offerings provided that the redemption occurs with the 120 days after the closing of such equity offerings.

On or after November 1, 2024, the Odeon Notes due 2027 will be redeemable, in whole or in part, at redemption prices equal to (i) 106.375 % for the twelve-month period beginning on November 1, 2024;

(ii) 103.188 % for the twelve-month period beginning on November 1, 2025 and (iii) 100.000 % at any time thereafter, plus accrued and unpaid interest, if any.

If the Company or its restricted subsidiaries sell assets under certain circumstances, the Company will be required to use the net proceeds to repay the Odeon Notes due 2027 or any additional First Lien Obligations at a price no less than 100 % of the issue price of the Odeon Notes due 2027, plus accrued and unpaid interest, if any.

Upon a Change of Control (as defined in the indenture governing the Odeon Notes due 2027), the Company must offer to purchase the Odeon Notes due 2027 at a purchase price equal to 101 % of the principal amount, plus accrued and unpaid interest, if any.

On December 14, 2022, the Odeon Notes due 2027 were admitted to the official list of The International Stock Exchange (“TISE”).

The Odeon Notes due 2027 will automatically delist from TISE on the business day following the maturity date of November 1, 2027, unless adequate notice is given together with supporting documents setting out any changes to the date of maturity or confirmation that the Odeon Notes due 2027 have not been fully repaid.

Odeon Term Loan Facility.

On February 15, 2021, Odeon Cinemas Group Limited (“Odeon”), a wholly-owned subsidiary of the Company, entered into a new £ 140.0 million and € 296.0 million term loan facility (the “Odeon Term Loan due 2023”) agreement (the “Odeon Term Loan Facility”), by and among Odeon, the subsidiaries of Odeon party thereto, the lenders and other loan parties thereto and Lucid Agency Services Limited as agent and Lucid Trustee Services Limited as security agent.

On February 15, 2021, Odeon Cinemas Group Limited (“OCGL”), a wholly-owned subsidiary of the Company, entered into a new £ 140.0 million and € 296.0 million term loan facility (the “Odeon Term Loan due 2023”) agreement (the “Odeon Term Loan Facility”), by and among Odeon, the subsidiaries of Odeon party thereto, the lenders and other loan parties thereto and Lucid Agency Services Limited as agent and Lucid Trustee Services Limited as security agent.

Approximately £ 89.7 million and € 12.8 million of the net proceeds from the Odeon Term Loan Facility were used to repay in full Odeon’s obligations (including principal, interest, fees and cash collateralized letters of credit) under its then-existing revolving credit facility and the remaining net proceeds will be used for general corporate purposes.

The Company recorded deferred financing costs of $ 1.0 million in other expense during the year ended December 31, 2021.

The Odeon Term Loan Facility has a maturity of August 19, 2023 ( 2.5 years from the date on which it was first drawn).

Borrowings under the Odeon Term Loan Facility bear interest at a rate equal to 10.75 % per annum during the first year and 11.25 % thereafter and each interest period is 3 months , or such other period agreed between the Company and the Agent.

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The discount and deferred financing costs will be amortized to interest expense over the term using the effective interest method.

All obligations under the Odeon Term Loan Facility are guaranteed by certain subsidiaries of Odeon.

The Company is subject to minimum liquidity requirements of £ 32.5 million (approximately $ 44 million) required under the Odeon Term Loan Facility, measured at each quarter end date.

Odeon Revolving Credit Facility.

On December 7, 2017, the Company entered into a Revolving Credit Facility Agreement (“Odeon Revolving Credit Facility”) with Citigroup Global Markets Limited, Lloyds Bank PLC, Barclays Bank PLC and Bank of America Merrill Lynch International Limited as arrangers.

The lenders made available a multicurrency revolving credit facility in an aggregate amount of £ 100.0 million.

The interest rate on each loan when drawn down under the Odeon Revolving Credit Facility was 2.5 % plus IBOR (meaning LIBOR, EURIBOR, CIBOR or STIBOR as applicable) per annum.

The undrawn commitment fee was 0.5 % of the undrawn amount per annum.

All assets located in England and Wales were pledged as collateral.

On April 24, 2020, Odeon Cinemas Group Limited entered into an amendment to the Odeon Revolving Credit Facility with Lloyds Bank PLC as agent (the “Odeon Amendment”), pursuant to the requisite lenders thereunder granted a waiver of the maintenance covenant thereunder for the period from and after the effective date of the Odeon Amendment to and including the earlier of (a) March 31, 2021 and (b) the day immediately preceding the last day of the Relevant Period (as defined in the Odeon Amendment) during which Odeon Cinemas Group Limited has delivered a Financial Covenant Election (as defined in the Odeon Amendment) to the agent (the “Odeon Covenant Suspension Period”).

During the Odeon Covenant Suspension Period, Odeon Cinemas Group Limited will not, and will not permit any of its subsidiaries to, make certain restricted payments including payment on shareholder loans, provided that cash payments of interest with respect to shareholder loans will be permitted.

Additionally, lenders granted a waiver such that certain events or circumstances resulting from COVID-19 virus occurring prior to the Odeon Amendment and continuing will be deemed not to constitute an event of default under the Odeon Revolving Credit Facility.

On February 15, 2021, Odeon used the net proceeds from the Odeon Term Loan Facility to repay in full its then-existing Odeon Revolving Credit Facility.

On October 20, 2022, the Company completely repaid the Odeon Term Loan Facility using existing cash and $ 363.0 million net proceeds from the issuance of the Odeon Notes due 2027.

First Lien Toggle Notes Due 2026

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The total cost to exercise this repurchase option was $ 40.3 million, including principal, redemption price and accrued and unpaid interest.

As a result of this debt reduction, the Company’s annual cash interest cost will be reduced by $ 5.25 million.

As a result of this debt reduction, the Company’s annual cash interest cost were reduced by $ 5.25 million.

During the year ended December 31, 2021, the Company recorded loss on debt extinguishment of $ 14.4 million in other expense.

See Note 16—Subsequent Events for additional information.

The First Lien Toggle Notes due 2026 bear cash interest at a rate of 15 % per annum payable semi-annually in arrears on January 15 and July 15, beginning on July 15, 2021.

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The Company filed a shelf registration statement in December 2020, which was declared effective providing for the resale of the Exchange Shares.

First Lien Notes Due 2029

On February 14, 2022, the Company issued $ 950.0 million aggregate principal amount of its 7.5 % First Lien Senior Secured Notes due 2029 (“First Lien Notes due 2029”), pursuant to an indenture, dated as of February 14, 2022, among the Company, the guarantors named therein and U.S.

Bank Trust Company, National Association, as trustee and collateral agent.

The Company used the net proceeds from the sale of the notes, and cash on hand, to fund the full redemption of the then outstanding $ 500 million aggregate principal amount of the Company’s 10.5 % First Lien Notes due 2025 (“First Lien Notes due 2025”), the then outstanding $ 300 million aggregate principal amount of the Company’s 10.5 % First Lien Notes due 2026 (“First Lien Notes due 2026”), and the then outstanding $ 73.5 million aggregate principal amount of the Company’s 15 %/ 17 % Cash/PIK Toggle First Lien Secured Notes due 2026 (“First Lien Toggle Notes due 2026”) and to pay related accrued interest, fees, costs, premiums and expenses.

The Company recorded a loss on debt extinguishment related to this transaction $ 135.0 million in other expense during the year ended December 31, 2022.

The deferred charges will be amortized to interest expense over the term of the First Lien Notes due 2029 using the effective interest method.

The First Lien Notes due 2029 bear cash interest at a rate of 7.5 % per annum payable semi-annually in arrears on February 15 and August 15, beginning on August 15, 2022.

The First Lien Notes due 2029 have not been registered under the Securities Act of 1933, as amended, and will mature on February 15, 2029.

The Company may redeem some or all of the First Lien Notes due 2029 at any time on or after February 15, 2025, at the redemption prices equal to (i) 103.750 % for the twelve-month period beginning on February 15, 2025;

(ii) 101.875 % for the twelve-month period beginning on February 15, 2026, and (iii) 100.0 % at any time thereafter, plus accrued and unpaid interest.

In addition, the Company may redeem up to 35 % of the aggregate principal amount of the First Lien Notes due 2029 using net proceeds from certain equity offerings completed prior to February 15, 2025 at a redemption price equal to 107.5 % of their aggregate principal amount and accrued and unpaid interest to, but not including the date of redemption.

The Company may redeem some or all of the First Lien Notes due 2029 at any time prior to February 15, 2025 at a redemption price equal to 100 % of their aggregate principal amount and accrued and unpaid interest to, but not including, the date of redemption, plus an applicable make-whole premium.

Upon a Change of Control (as defined in the indenture governing the First Lien Notes due 2029), the Company must offer to purchase the First Lien Notes due 2029 at a purchase price equal to 101 % of the principal amounts, plus accrued and unpaid interest.

The First Lien Notes due 2029 are general senior secured obligations of the Company and are fully and unconditionally guaranteed on a joint and several senior secured basis by all of the Company’s existing and future subsidiaries that guarantee the Company’s other indebtedness, including the Company’s Senior Secured Credit Facilities.

The First Lien Notes due 2029 are secured, on a pari passu basis with the Senior Secured Credit Facilities, on a first-priority basis by substantially all of the tangible and intangible assets owned by the Company and guarantors that secure obligations under the Senior Secured Credit Facilities including pledges of capital stock of certain of the Company’s and the guarantor’s wholly-owned material subsidiaries (but limited to 65 % of the voting stock of any foreign subsidiary), subject to certain thresholds, exceptions and permitted liens.

The indentures governing the First Lien Notes due 2029 contain covenants that restrict the ability of the Company to, among other things:

(i) incur additional indebtedness, including additional senior indebtedness;

(ii) pay dividends on or make other distributions in respect of its capital stock;

(iii) purchase or redeem capital stock or prepay subordinated debt or other junior securities (iv) create liens ranking pari passu in right of payment with or subordinated in right of payment to First Lien Notes due 2029;

(v) enter into certain transactions with its affiliates;

and (vi) merge or consolidate with other companies or transfer all or substantially all of their respective assets.

These covenants are subject to a number of important limitations and exceptions.

The indentures governing the First Lien Notes due 2029 also provides for events of default, which, if any occur, would permit or require the principal, interest and any other monetary obligations on all the then outstanding notes to be due and payable immediately.

Senior Subordinated Debt Exchange Offers

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The Company accounted for the exchange of approximately $ 1,782.5 million principal amount of its Existing Senior Subordinated Notes for approximately $ 1,289.1 million principal amount of the Second Lien Notes due 2026 as TDR.

The Company accounted for the exchange of the remaining approximately $ 235.0 million principal amount of its Existing Senior Subordinated Notes for approximately $ 173.2 million principal amount of the Second Lien Notes due 2026 as a modification of debt as the lenders did not grant a concession and the difference between the present value of the old and new cash flows was less than 10 %.

modification of debt as the lenders did not grant a concession and the difference between the present value of the old and new cash flows was less than 10 %.

The TDR and modification did not result in a gain recognition and the Company established new effective interest rates based on the carrying value of the Existing Subordinated Notes and recorded the new fees paid to third parties of approximately $ 39.3 million in other expense, during the year ended December 31, 2020.

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The Second Lien Notes due 2026 were issued pursuant to an indenture, dated as of July 31, 2020, among the Company, the guarantors named therein and GLAS Trust Company LLC, as trustee and collateral agent.

The Company has reflected a premium of $ 535.1 million on the Second Lien Notes due 2026 as the difference between the principal balance of the

Second Lien Notes due 2026 and the $ 1,997.4 million carrying value of the Existing Subordinated Notes exchanged.

The Company has reflected a premium of $ 535.1 million on the Second Lien Notes due 2026 as the difference between the principal balance of the Second Lien Notes due 2026 and the $ 1,997.4 million carrying value of the Existing Subordinated Notes exchanged.

The premium will be amortized to interest expense over the term of the Second Lien Notes due 2026 using the effective interest method.

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The Second Lien Notes due 2026 have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) and will mature on June 15, 2026.

The Second Lien Notes due 2026 are fully and unconditionally guaranteed on a joint and several basis by each of the Company’s subsidiaries that currently guarantee its obligations under the Company’s Senior Secured Credit Facilities.

The Second Lien Notes due 2026 are secured on a second-priority basis by substantially all of the tangible and intangible assets owned by the Company and the guarantor subsidiaries that secure obligations under the Senior Secured Credit Facilities (“Collateral”).

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The Second Lien Notes due 2026 Indenture also contains certain affirmative covenants and events of default.

During the year ended December 31, 2022, the Company repurchased $ 118.3 million aggregate principal amounts of the Second Lien Notes due 2026 for $ 68.3 million and recorded a gain on extinguishment of $ 75.0 million in other expense (income).

Accrued interest of $ 4.5 million was paid in connection with the repurchases.

First Lien Notes due 2026.

In connection with the Exchange Offers, certain holders of the Existing Subordinated Notes purchased 10.5 % First Lien Notes due 2026 in an aggregate principal amount of $ 200 million.

The 10.5 % First Lien Notes due 2026 issued to certain holders of the Existing Subordinated Notes were issued pursuant to an

indenture, dated as of July 31, 2020, among the Company, the guarantors named therein and GLAS Trust Company LLC, as trustee and collateral agent.

See Note 16—Subsequent Events for additional information.

The 10.5 % First Lien Notes due 2026 issued to certain holders of the Existing Subordinated Notes were issued pursuant to an indenture, dated as of July 31, 2020, among the Company, the guarantors named therein and GLAS Trust Company LLC, as trustee and collateral agent.

Separately, upon the closing of its private debt exchange, Silver Lake Alpine, L.P.

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incur additional debt or issue certain preferred shares;

pay dividends on or make other distributions in respect of its capital stock or make other restricted payments;

pay dividends on or make other distributions in

respect of its capital stock or make other restricted payments;

make certain investments;

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Senior Secured Credit Facilities.

The Company is party to that certain Credit Agreement, dated as of April 30, 2013 (as amended by that certain First Amendment to Credit Agreement, dated as of December 11, 2015, that certain Second Amendment to Credit Agreement, dated as of November 8, 2016, that certain Third Amendment to Credit Agreement, dated as of May 9, 2017, that certain Fourth Amendment to Credit Agreement, dated as of June 13, 2017, that certain Fifth Amendment to Credit Agreement, dated as of August 14, 2018, that certain Sixth Amendment to Credit Agreement, dated as of April 22, 2019, that certain Seventh Amendment to Credit Agreement, dated as of April 23, 2020, that certain Eighth Amendment to Credit Agreement, dated as of July 31, 2020, that certain Ninth Amendment to Credit Agreement, dated as of March 8, 2021, that certain Tenth Amendment to Credit Agreement, also dated as of March 8, 2021, and that certain Eleventh Amendment to Credit Agreement, dated as of December 20, 2021, (the “Eleventh Amendment”), the “Credit Agreement”) with the issuing banks and lenders from time to time party thereto and Wilmington Savings Fund Society, FSB, as administrative agent (as successor to Citicorp North America, Inc., the “Administrative Agent”), pursuant to which the lenders have agreed to provide the Senior Secured Term Loan (as

defined below) and the Senior Secured Revolving Credit Facility (as defined below).

The Company is party to that certain Credit Agreement, dated as of April 30, 2013 (as amended by that certain First Amendment to Credit Agreement, dated as of December 11, 2015, that certain Second Amendment to Credit Agreement, dated as of November 8, 2016, that certain Third Amendment to Credit Agreement, dated as of May 9, 2017, that certain Fourth Amendment to Credit Agreement, dated as of June 13, 2017, that certain Fifth Amendment to Credit Agreement, dated as of August 14, 2018, that certain Sixth Amendment to Credit Agreement, dated as of April 22, 2019, that certain Seventh Amendment to Credit Agreement, dated as of April 23, 2020, that certain Eighth Amendment to Credit Agreement, dated as of July 31, 2020, that certain Ninth Amendment to Credit Agreement, dated as of March 8, 2021, that certain Tenth Amendment to Credit Agreement, also dated as of March 8, 2021, that certain Eleventh Amendment to Credit Agreement, dated as of December 20, 2021 (the “Eleventh Amendment”), and that certain Twelfth Amendment to Credit Agreement, dated as of January 25, 2023 (the “Twelfth Amendment”), the “Credit Agreement”), with the issuing banks and lenders from time to time party thereto and Wilmington Savings Fund Society, FSB, as administrative agent (as successor to Citicorp North America, Inc., the “Administrative Agent”), pursuant to which the lenders have agreed to provide the Senior Secured Term Loan (as defined below) and the Senior Secured Revolving Credit Facility (as defined below).

The Senior Secured Credit Facilities (as defined below) are provided by a syndicate of banks and other financial institutions.

On March 8, 2021, the Company entered into the Ninth Amendment to Credit Agreement (the “Ninth Amendment”), with the requisite revolving lenders party thereto and the Administrative Agent, pursuant to which the requisite revolving lenders party thereto agreed to extend the suspension period for the financial covenant under its Credit Agreement from a period ending March 31, 2021, to a period ending on March 31, 2022 (the “Extended Covenant Suspension Period ending March 31, 2022”), which was further extended by the Eleventh Amendment from a period ending March 31, 2021, to a period ending on March 31, 2023 (the “Extended Covenant Suspension Period ending March 31, 2023”).

During the Extended Covenant Suspension Period ending March 31, 2022 and the Extended Covenant Suspension Period ending March 31, 2023, the Company will not, and will not permit any of its restricted subsidiaries to, (i) make certain restricted payments, (ii) subject to certain exceptions, incur any indebtedness for borrowed money that is pari passu or senior in right of payment or security with the Revolving Loans (as defined in the Credit Agreement) or (iii) make any investment in or otherwise dispose of any assets to any subsidiary of the Company that is not a Loan Party (as defined in the Credit Agreement) to facilitate a new financing incurred by a subsidiary of the Company.

On March 8, 2021, the Company entered into the Ninth Amendment to Credit Agreement (the “Ninth Amendment”), with the requisite revolving lenders party thereto and the Administrative Agent, pursuant to which the requisite revolving lenders party thereto agreed to extend the suspension period for the financial covenant applicable to the Senior Secured Revolving Credit Agreement under the Credit Agreement (the “Covenant Suspension Period”) from a period ending March 31, 2021, to a period ending on March 31, 2022, which was extended by the Eleventh Amendment to a period ending on March 31, 2023, which was further extended by the Twelfth Amendment to a period ending on March 31, 2024 (the Covenant Suspension Period as so extended, the “Extended Covenant Suspension Period”).

During the Extended Covenant Suspension Period, the Company will not, and will not permit any of its restricted subsidiaries to, (i) make certain restricted payments, (ii) subject to certain exceptions, incur any indebtedness for borrowed money that is pari passu or senior in right of payment or security with the Revolving Loans (as defined in the Credit Agreement) or (iii) make any investment in or otherwise dispose of any assets to any subsidiary of the Company that is not a Loan Party (as defined in the Credit Agreement) to facilitate a new financing incurred by a subsidiary of the Company.

In addition, as an ongoing condition to the suspension of the financial covenant, the Company also agreed to (i) a minimum liquidity test of $ 100 million, (ii) an anti-cash hoarding test at any time Revolving Loans are outstanding and (iii) additional reporting obligations.

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On April 23, 2020, the Company entered into the Seventh Amendment to Credit Agreement (the “Seventh Amendment”) with the requisite revolving lenders party thereto and Citicorp North America, Inc., as administrative agent, pursuant to which the requisite revolving lenders party thereto agreed to suspend the financial covenant applicable to the Senior Secured Revolving Credit Facility for the period from and after the effective date of the Seventh Amendment to and including the earlier of (a) March 31, 2021 and (b) the day immediately preceding the last day of the Test Period (as defined in the Credit Agreement) during which the Company has delivered a Financial Covenant Election (as defined in the Credit Agreement) to the Administrative Agent (such period, the “Initial Covenant Suspension Period”).

During the Initial Covenant Suspension Period, the Company will not, and will not permit any of its restricted subsidiaries to, make certain restricted payments, and such conditions were further amended by the Ninth Amendment.

During the Initial Covenant Suspension Period, the Company will not, and will not permit any of its restricted

subsidiaries to, make certain restricted payments, and such conditions were further amended by the Ninth Amendment.

As an ongoing condition to the suspension of the financial covenant, the Company agreed to a minimum Liquidity (as defined in the Seventh Amendment) test, which was amended by the Ninth Amendment.

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On April 22, 2019, the Company entered into the Sixth Amendment to Credit Agreement (the “Sixth Amendment”) with each lender party thereto and Citicorp North America, Inc., as administrative agent.

Pursuant to the Sixth Amendment, the lenders agreed to provide senior secured financing of $ 2,225.0 million in aggregate, consisting of (1) $ 2,000.0 million in aggregate principal amount of senior secured tranche B loans maturing April 22, 2026 (the “Senior Secured Term Loans)” and (2) a $ 225.0 million senior secured revolving credit facility (which is also available

for letters of credit and for swingline borrowings on same-day notice) maturing April 22, 2024 (the “Senior Secured Revolving Credit Facility” and, together with the Senior Secured Term Loans, the “Senior Secured Credit Facilities”).

The proceeds of the Senior Secured Term Loans were used to repay all of the Company’s existing term loans in an aggregate principal amount of approximately $ 1,338.5 million and to fund the redemptions of the 5.875 % Senior Subordinated Notes due 2022 and the 6.0 % Senior Secured Notes due 2023.

The Company recorded a loss of $ 16.6 million during the year ended December 31, 2019 related to these transactions, comprised of $ 14.1 million of extinguishment losses and $ 2.5 million of third party costs related to the modification of the Term Loans.

Pursuant to the Sixth Amendment, the lenders agreed to provide senior secured financing of $ 2,225.0 million in aggregate, consisting of (i) $ 2,000.0 million in aggregate principal amount of senior secured tranche B loans maturing April 22, 2026 (the “Senior Secured Term Loans”) and (ii) a $ 225.0 million senior secured revolving credit facility (which is also available for letters of credit and for swingline borrowings on same-day notice) maturing April 22, 2024 (the “Senior Secured Revolving Credit Facility” and, together with the Senior Secured Term Loan Loans, the “Senior Secured Credit Facilities”).

All obligations under the Credit Agreement are guaranteed by, subject to certain exceptions, each of the Company’s current and future wholly-owned material U.S.

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● 100 % of the net proceeds of any issuance or incurrence of debt by the Company or any of its restricted subsidiaries, other than certain debt permitted under the Credit Agreement.

The foregoing mandatory prepayments will be used to reduce the installments of principal payments on the Senior Secured Term Loans.

The foregoing mandatory prepayments will be used to reduce the installments of principal payments on the Senior Secured Term Loan.

The Company may voluntarily repay outstanding loans under the Senior Secured Credit Facilities at any time without premium or penalty, except for customary “breakage” costs with respect to LIBOR loans under the Senior Secured Credit Facilities.

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dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs.

Borrowings under the Senior Secured Revolving Credit Facility bear interest at a rate per annum equal to an applicable margin based upon a leverage-based pricing grid, plus, at the Company’s option, either (1) a base rate determined by reference to the highest of (a) 0.50 % per annum plus the Federal Funds Effective Rate, (b) the prime rate announced by the Administrative Agent from time to time and (c) LIBOR determined by reference to the cost of funds for U.S.

under the Senior Secured Revolving Credit Facility bear interest at a rate per annum equal to an applicable margin based upon a leverage-based pricing grid, plus, at the Company’s option, either (1) a base rate determined by reference to the highest of (a) 0.50 % per annum plus the Federal Funds Effective Rate, (b) the prime rate announced by the Administrative Agent from time to time and (c) LIBOR determined by reference to the cost of funds for U.S.

dollar deposits for an interest period of one month adjusted for certain additional costs, plus 1.00 % or (2) LIBOR determined by reference to the costs of funds for U.S.

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On January 27, 2021, affiliates of Silver Lake and certain co-investors (collectively, the “Noteholders”) elected to convert (the “Conversion”) all $ 600.0 million principal amount of the Company’s Convertible Notes due 2026 into shares of the Company’s Common Stock at a conversion price of $ 6.76 per share.

The non-cash Conversion settled on January 29, 2021, and resulted in the issuance of 44,422,860 shares of the Company’s Common Stock to the Noteholders.

The non-cash Conversion settled on January 29, 2021, and resulted in the issuance of 44,422,860 shares of the Company’s Common Stock and 44,422,860 of the Company’s AMC Preferred Equity Units to the Noteholders.

The Company recorded approximately $ 71.0 million of non-cash interest expense during the year ended December 31, 2021 for unamortized discount and deferred charges at the date of conversion following the guidance in ASC 815-15-40-1.

1 unchanged sentence

Pursuant to the Stock Repurchase and Cancellation Agreement with Dalian Wanda Group Co., Ltd.

(“Wanda”) dated as of September 14, 2018, 5,666,000 shares of the Company’s Class B common stock held by Wanda were forfeited and cancelled in connection with the Conversion.

(“Wanda”) dated as of September 14, 2018, 5,666,000 shares of the Company’s Class B common stock and 5,666,000 AMC Preferred Equity Units held by Wanda were forfeited and cancelled in connection with the Conversion.

The carrying value of the Convertible Notes is as follows:

18 unchanged sentences

The Convertible Notes due 2024 would have matured on September 15, 2024, subject to earlier conversion by the holders thereof, repurchase by the Company at the option of the holders or redemption by the Company upon the occurrence of certain contingencies, as discussed below.

to the debt instrument and the reset of the conversion price caused the conversion feature to not be considered indexed to the Company’s equity, (2) the conversion feature standing alone met the definition of a derivative, and (3) the Convertible Notes due 2024 were not remeasured at fair value each reporting period with changes in fair value recorded in the consolidated statements of operations.

On September 14, 2018, the Company bifurcated the conversion feature from the principal balance of the Convertible Notes due 2024 as a derivative liability because (1) a conversion feature was not clearly and closely related to the debt instrument and the reset of the conversion price caused the conversion feature to not be considered indexed to the Company’s equity, (2) the conversion feature standing alone met the definition of a derivative, and (3) the Convertible Notes due 2024 were not remeasured at fair value each reporting period with changes in fair value recorded in the consolidated statements of operations.

The initial derivative liability of $ 90.4 million is offset by a discount to the principal balance and was amortized to interest expense resulting in an effective rate of 5.98 % over the extended term of the Convertible Notes due 2024.

The Company also recorded deferred financing costs of approximately $ 13.6 million related to the issuance of the Convertible Notes due 2024 and will amortize those costs to interest expense under the effective interest method over the extended term of the Convertible Notes due 2024.

The Company recorded interest expense for the years ended December 31, 2021, December 31, 2020 and December 31, 2019 of $ 0 million, $ 31.8 million, and $ 32.6 million, respectively.

The Company recorded interest expense for the year ended December 31, 2020 $ 31.8 million.

The derivative liability was remeasured at fair value each reporting period, a Level 3 fair value estimate, until the conversion price reset on September 14, 2020, with changes in fair value recorded in the consolidated statements of operations as other expense or income.

1 unchanged sentence

For the years ended December 31, 2020 and December 31, 2019, the Company recorded in other expense (income) of $ 89.4 million and $( 23.5 ) million, respectively, related to the derivative liability fair value adjustments for embedded conversion feature in the Convertible Notes due 2024.

Pursuant to the Stock Repurchase and Cancellation Agreement between the Company and Wanda, the conversion feature of the Convertible Notes due 2024 would result in 5,666,000 shares of the Company’s Class B common stock held by Wanda being subject to forfeiture and retirement by the Company at no additional cost.

Pursuant to the Stock Repurchase and Cancellation Agreement between the Company and Wanda, the conversion feature of the Convertible Notes due 2024 would result in 5,666,000 shares of the Company’s Class B common stock and 5,666,000 AMC Preferred Equity Units held by Wanda being subject to forfeiture and retirement by the Company at no additional cost.

This cancellation agreement was a contingent call option for the forfeiture shares, which was a freestanding derivative measured at fair value on a recurring basis, which was a Level 3 estimate of fair value.

1 unchanged sentence

The forfeiture shares feature was not clearly and closely related to the Convertible Notes due 2024 host and it was bifurcated and accounted for as a derivative asset measured at fair value through earnings each reporting period until the conversion feature reset on September 14, 2020, with changes in fair value recorded in the consolidated statements of operations as other expense or income.

For the years ended December 31, 2020 and December 31, 2019, this resulted in other expense (income) of $ 19.6 million and $ 17.7 million, respectively, related to the derivative asset fair value adjustment for contingent call option related to the Class B common stock purchase and cancellation agreement.

For the year ended December 31, 2020, this resulted in other expense (income) of $ 19.6 million related to the derivative asset fair value adjustment for contingent call option related to the Class B common stock purchase and cancellation agreement.

On September 14, 2020, the conversion price reset from $ 9.48 per share to $ 6.76 per share pursuant to the terms of the Indenture for the Convertible Notes due 2024 and the derivative asset as of September 14, 2020 was reclassified to permanent equity as the number of shares that will be cancelled on conversion of the Convertible Notes due 2024 were known.

8 unchanged sentences

The Company recorded deferred financing costs of approximately $ 8.9 million related to the issuance of the First Lien Notes due 2025 and will amortize those costs to interest expense under the effective interest method over the term of the First Lien Notes due 2025.

See Note 16—Subsequent Events for additional information.

The First Lien Notes due 2025 are general senior secured obligations of the Company and are fully and unconditionally guaranteed on a joint and several senior secured basis by all of the Company’s existing and future subsidiaries that guarantee the Company’s other indebtedness, including the Company’s Senior Secured Credit Facilities.

The First Lien Notes due 2025 are secured, on a pari passu basis with the Senior Secured Credit Facilities, on a first-

priority basis by substantially all of the tangible and intangible assets owned by the Company and guarantors that secure obligations under the Senior Secured Credit Facilities including pledges of capital stock of certain of the Company’s and the guarantor’s wholly-owned material subsidiaries (but limited to 65 % of the voting stock of any foreign subsidiary), subject to certain thresholds, exceptions and permitted liens.

The First Lien Notes due 2025 are secured, on a pari passu basis with the Senior Secured Credit Facilities, on a first-priority basis by substantially all of the tangible and intangible assets owned by the Company and guarantors that secure obligations under the Senior Secured Credit Facilities including pledges of capital stock of certain of the Company’s and the guarantor’s wholly-owned material subsidiaries (but limited to 65 % of the voting stock of any foreign subsidiary), subject to certain thresholds, exceptions and permitted liens.

The Company may redeem some or all of the First Lien Notes due 2025 at any time on or after April 15, 2022, at the redemption prices set forth in the First Lien Notes Indenture.

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On March 17, 2017, in connection with the issuance of the additional Sterling Notes due 2024, the Company entered into a registration rights agreement.

Subject to the terms of the registration rights agreement, the Company is

required to (1) file one or more registration statements with the SEC not later than 270 days from November 8, 2016 with respect to the registered offer to exchange the notes for new notes of the Company having terms identical in all material respects to the notes and (2) use its commercially reasonable efforts to cause the exchange offer registration statement to be declared effective under the Securities Act within 365 days of November 8, 2016.

Subject to the terms of the registration rights agreement, the Company is required to (1) file one or more registration statements with the SEC not later than 270 days from November 8, 2016 with respect to the registered offer to exchange the notes for new notes of the Company having terms identical in all material respects to the notes and (2) use its commercially reasonable efforts to cause the exchange offer registration statement to be declared effective under the Securities Act within 365 days of November 8, 2016.

The Company filed its Form S–4 registration statement related to the registration rights agreement with the Securities and Exchange Commission on April 19, 2017, and it was declared effective June 7, 2017.

25 unchanged sentences

Subject to the terms of the registration rights agreement, the Company is required to (1) file a registration statement with the SEC not later than 270 days from the issuance date with respect to the registered offer to exchange the notes for new notes of the Company having terms identical in all material respects to the notes and (2) use its commercially reasonable efforts to cause the exchange offer registration statement to be declared effective under the Securities Act within 365 days of the issuance date.

The Company filed its Form S–4 registration statement

related to the registration rights agreement with the Securities and Exchange Commission on April 19, 2017, and it was declared effective June 7, 2017.

All of the original notes were exchanged as of July 12, 2017.

14 unchanged sentences

On July 31, 2020, as part of the Exchange Offers, the Company reduced the aggregate principal amounts of Notes due 2027 by approximately $ 344.3 million, or 72.48 % of the then outstanding Notes due 2027.

During the year ended December 31, 2022, the Company repurchased $ 5.3 million aggregate principal payments of Senior Subordinated Notes due 2027 for $ 1.6 million and recorded a gain on extinguishment of $ 3.7 million in other expense (income).

Financial Covenants

The Company currently estimates that its existing cash and cash equivalents will be sufficient to comply with minimum liquidity and financial covenant requirements under its debt covenants related to borrowings pursuant to the Senior Secured Revolving Credit Facility and Odeon Term Loan Facility, currently and through the next twelve months.

The Company entered the Ninth Amendment pursuant to which the requisite revolving lenders party thereto agreed to extend the suspension period for the financial covenant (the secured leverage ratio) applicable to the Senior Secured Revolving Credit Facility from March 31, 2021 to March 31, 2022, which was further extended by the Eleventh Amendment from March 31, 2022 to March 31, 2023, as described, and on the terms and conditions specified, therein.

The Company is currently subject to minimum liquidity requirements of approximately $ 144 million, of which $ 100 million is required under the conditions for the Extended Covenant Suspension Period, as amended, under the Senior Secured Revolving Credit Facility, and £ 32.5 million (approximately $ 44 million) of which is required under the Odeon Term Loan Facility.

The Company’s liquidity needs thereafter will depend, among other things, on the timing of movie releases and its ability to generate cash from operations.

As of December 31, 2021, the Company was in a covenant suspension period under the Senior Secured Revolving Credit Facility and the Odeon Revolving Credit Facility as described above.

The Company entered the Ninth Amendment pursuant to which the requisite revolving lenders party thereto agreed to extend the fixed date for the termination of the suspension period for the financial covenant (the secured leverage ratio) applicable to the Senior Secured Revolving Credit Facility from March 31, 2021 to March 31, 2022, which was further extended by the Eleventh Amendment from March 31, 2022 to March 31, 2023 and further extended by the Twelfth Amendment from March 31, 2023 to March 31, 2024, in each case, as described, and on the terms and conditions specified, therein.

The Company is currently subject to a minimum liquidity requirement of $ 100 million as a condition to the Extended Covenant Suspension Period.

The current maturity date of the Senior Secured Revolving Credit Facility is April 22, 2024;

As of December 31, 2022, the Company was in a covenant suspension period under the Senior Secured Revolving Credit Facility as described above.

NOTE 9—STOCKHOLDERS’ EQUITY

Common Stock Rights and Privileges

Holders of Holdings’ Common Stock are entitled to one vote per share.

Holders of Common Stock share ratably (based on the number of shares of Common Stock held) in any dividend declared by its board of directors, subject to any preferential rights of any outstanding preferred stock.

The Common Stock is not convertible into any other shares of Holdings’ capital stock.

Common Stock Issuances

The Company entered into equity distribution agreements with sales agents to sell approximately 241.6 million and 90.9 million shares of the Company’s Common Stock, par value $ 0.01 per share, through “at-the-market” offering programs during the years ended December 31, 2021 and December 31, 2020, respectively.

During the year ended December 31, 2021, the Company raised gross proceeds of approximately $ 1,611.8 million related to the “at-the-market” offering programs and paid fees to the sales agents of approximately $ 40.3 million and other fees of $ 0.8 million.

During the year ended December 31, 2020, the Company raised gross proceeds of approximately $ 272.8 million related to the “at-the-market” offering programs and paid fees to the sales agents of approximately $ 8.1 million.

The Company intends to use the net proceeds from the sale of the Common Stock pursuant to the equity distribution agreement for general corporate purposes, which may include the repayment, refinancing, redemption or repurchase of existing indebtedness or working capital, capital expenditures and other investments.

The gross proceeds raised from the “at-the-market” sale of Common Stock during the years ended December 31, 2021 and December 31, 2020, are summarized in the table below:

Share Rights and Privileges

Holders of Holdings’ Common Stock and AMC Preferred Equity Units are entitled to one vote per each share and holders of AMC Preferred Equity Units are entitled to one vote per unit.

Holders of Common Stock and AMC Preferred Equity Units share ratably (based on the number of shares of Common Stock and/or AMC Preferred Equity Units held) in any dividend declared by its board of directors.

AMC Preferred Equity Units are convertible into shares of Common Stock upon stockholder approval to authorize sufficient additional Common Stock to do so, otherwise the Common Stock and AMC Preferred Equity Units are not convertible into any other shares of Holdings’ capital stock.

Share Issuances

During the years ended December 31, 2022, December 31, 2021 and December 31, 2020, the Company entered into various equity distribution agreement with sales agents to sell shares of the Company’s Common Stock and AMC Preferred Equity Units, from time to time, through “at-the-market” offering programs.

Subject to the terms and conditions of the equity distribution agreements, the sales agents will use reasonable efforts consistent with their normal trading and sales practices, applicable law and regulations, and the rules of the NYSE to sell the Common Stock and AMC Preferred Equity Units from time to time based upon the Company’s instructions for the sales, including any price, time or size limits specified by the Company.

The Company intends to use the net proceeds, from the sale of Common Stock and AMC Preferred Equity Units pursuant to the equity distribution agreements to repay, refinance, redeem or repurchase the Company’s existing indebtedness (including expenses, accrued interest and premium, if any), capital expenditures and otherwise for general corporate purposes.

On December 22, 2022, the Company entered into a forward purchase agreement (the “Forward Purchase Agreement”) with Antara pursuant to which the Company will (i) sell Antara 106,595,106 APEs for an aggregate purchase price of $ 75.1 million and (ii) simultaneously purchase from Antara $ 100 million aggregate principal amount of the Company's 10%/12% Cash/PIK Toggle Second Lien Notes due 2026 in exchange for 91,026,191 APEs.

Immediately prior to entry into the Forward Purchase Agreement, Antara purchased 60,000,000 APEs (the “Initial APEs”) under the Company’s at-the-market program for $ 34.9 million.

The Forward Purchase Agreement and Initial APEs were determined to be equity investments and the related $ 34.9 million is recorded into Additional Paid-in Capital at December 31, 2022.

During the years ended December 31, 2022, December 31, 2021 and December 31, 2020, the Company paid fees to the sales agents of approximately $ 5.7 million, $ 40.3 million, $ 8.1 million, respectively.

During the year ended December 31, 2021, the Company paid other fees of $ 0.8 million.

The gross proceeds raised from the “at-the-market” sale of Common Stock and AMC Preferred Equity Units during the years ended December 31, 2022, December 31, 2021 and December 31, 2020, are summarized in the table below:

"At-the-market"

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Number of Class A common stock shares sold (in millions)

Number of AMC Preferred Equity Units sold (in millions)

Gross Proceeds (in millions)

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Total year ended December 31, 2021

September 26, 2022

Citigroup Global Markets Inc.

Total year ended December 31, 2022

(1) On December 11, 2020, the Company entered into an equity distribution agreement with Goldman Sachs & Co.

Riley Securities, Inc., as sales agents to sell up to 178.0 million shares of the Company’s Common Stock, of which approximately 40.93 million shares of Common Stock were sold and settled during December 2020 and approximately 137.07 million shares of Common Stock were sold and settled during the year ended December 31, 2021.

(2) Included in the Common Stock shares sold of 43.0 million was the reissuance of treasury stock shares of approximately 3.7 million shares.

Riley Securities, Inc., as sales agents to sell up to 178.0 million shares of the Company’s Common Stock and 178.0 million AMC Preferred Equity Units, of which approximately 40.93 million shares of Common Stock and 40.93 million shares of AMC Preferred Equity Units were sold and settled during December 2020 and approximately 137.07 million shares of Common Stock and 137.0 million shares of AMC Preferred Equity Units were sold and settled during the year ended December 31, 2021.

(2) Included in the Common Stock shares and AMC Preferred Equity Unit shares sold of 43.0 million each was the reissuance of treasury stock shares of approximately 3.7 million shares.

Upon the sales of treasury stock, the Company reclassified amounts recorded in treasury stock to additional paid-in capital of $ 37.1 million and loss of $ 19.3 million to retained earnings during the year ended December 31, 2021.

Common Stock Transaction Related to Exchange Offers

Certain backstop purchasers of the First Lien Notes due 2026 that participated in the Exchange Offer received five million common shares.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for further information.

Common Stock Transactions with Mudrick

On June 1, 2021, the Company issued to Mudrick 8.5 million shares of the Company’s Common Stock and raised gross proceeds of $ 230.5 million and paid fees of approximately $ 0.1 million related to this transaction.

Transaction Related to Exchange Offers

Certain backstop purchasers of the First Lien Notes due 2026 that participated in the Exchange Offer received five million common shares and five million AMC Preferred Equity Units.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities for further information.

Transactions with Mudrick

On June 1, 2021, the Company issued to Mudrick 8.5 million shares of the Company’s Common Stock, 8.5 million of AMC Preferred Equity Units and raised gross proceeds of $ 230.5 million and paid fees of approximately $ 0.1 million related to this transaction.

The Company issued the shares in reliance on an exemption from registration provided by section 4(a)(2) of the Securities Act of 1933.

The Company intends to use the proceeds from the share sale primarily for the pursuit of value creating acquisitions of theatre assets and leases, as well as investments to enhance the consumer appeal of its theatres.

The Company intends to use the proceeds from the share sale primarily for the pursuit of value creating acquisitions of theatre assets and leases, as well as investments to enhance the consumer

appeal of its theatres.

In addition, with these funds, the Company intends to continue exploring deleveraging opportunities.

On December 14, 2020, Mudrick received a total of 21,978,022 shares of the Company’s Common Stock;

of which 8,241,758 shares relates to consideration received for a commitment fee and 13,736,264 shares as consideration received for (i) the commitment provided with respect to the First Lien Toggle Notes due 2026 and (ii) the Second Lien Exchange.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for further information.

On December 14, 2020, Mudrick received a total of 21,978,022 shares of the Company’s Common Stock and 21,978,022 of AMC Preferred Equity Units;

of which 16,483,516 shares and units relates to consideration received for a commitment fee and 27,472,528 shares and units as consideration received for (i) the commitment provided with respect to the First Lien Toggle Notes due 2026 and (ii) the Second Lien Exchange.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities for further information.

Class B Common Stock

On January 27, 2021, pursuant to the Stock Repurchase and Cancellation Agreement with Wanda dated as of September 14, 2018, and in connection with the Conversion of the Convertible Notes due 2026 into shares of the Company’s Common Stock by Silver Lake and certain co-investors, 5,666,000 shares of the Company’s Class B common stock held by Wanda were forfeited and cancelled.

On February 1, 2021, Wanda exercised their right to convert all outstanding Class B common stock of 46,103,784 to Common Stock thereby reducing the number of outstanding Class B common stock to zero, which resulted in the retirement of Class B common stock.

On February 1, 2021, Wanda exercised their right to convert all outstanding Class B common stock of 46,103,784 and 46,103,784 of AMC Preferred Equity Units to Common Stock thereby reducing the number of outstanding Class B common stock to zero, which resulted in the retirement of Class B common stock.

The Third Amended and Restated Certificate of Incorporation of the Corporation provides that Class B common stock may not be reissued by the Company.

Since April 24, 2020, the Company has been prohibited from making dividend payments in accordance with the covenant suspension conditions in its Credit Agreement (as defined in Note 8 — Corporate Borrowings and Finance Lease Obligations).

The following is a summary of dividends and dividend equivalents declared to stockholders during the year ended December 31, 2020:

Declaration Date

(In millions)

February 26, 2020

March 9, 2020

March 23, 2020

During the year ended December 31, 2020, the Company paid dividends and dividend equivalents of $ 6.5 million and accrued $ 0.4 million for the remaining unpaid dividends at December 31, 2020.

The aggregate dividends paid for Common Stock, Class B common stock, and dividend equivalents were approximately $ 1.6 million, $ 1.6 million, and $ 3.3 million, respectively.

Since April 24, 2020, the Company has been prohibited from making dividend payments in accordance with the covenant suspension conditions in its Credit Agreement (for further information see Note 8 — Corporate Borrowings and Finance Lease Liabilities to the Consolidated Financial Statements included in Part II, Item 8 on this Annual Report on Form 10-K).

The following is a summary of dividends and dividend equivalents declared to stockholders during the year ended December 31, 2020:

Declaration Date

Preferred Equity Units

(In millions)

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March 23, 2020

June 10, 2019

June 24, 2019

August 2, 2019

September 9, 2019

September 23, 2019

October 24, 2019

December 2, 2019

December 16, 2019

During the year ended December 31, 2020, the Company paid dividends and dividend equivalents of $ 6.5 million and accrued $ 0.4 million for the remaining unpaid dividends at December 31, 2020.

The aggregate dividends paid for Common Stock, Class B common stock, and dividend equivalents were approximately $ 41.7 million, $ 41.4 million, and $ 1.0 million, respectively.

The aggregate dividends paid for Common Stock, AMC Preferred Equity Units, Class B common stock, and dividend equivalents were approximately $ 0.8 million, $ 0.8 million, $ 1.6 million, and $ 3.3 million, respectively.

Related Party Transactions

As of December 31, 2021 and December 31, 2020, the Company recorded a receivable due from Wanda of $ 0 and $ 0.7 million, respectively, for reimbursement of general administrative and other expense incurred on behalf of Wanda.

The Company recorded cost reductions for general and administrative services provided on behalf of Wanda of $ 0 , $ 0.3 million and $ 0.4 million for the years ended December 31, 2021, December 31, 2020, and December 31, 2019, respectively.

By the end of the first quarter of 2021, Wanda was no longer a related party of the Company.

On September 14, 2018, the Company entered into the Investment Agreement with Silver Lake, relating to the issuance to Silver Lake (or its designated affiliates) of $ 600.0 million principal amount of the Convertible Notes due 2024 and entered into an amended and restated investment agreement with Silver Lake, relating to the issuance of the Convertible Notes due 2026 on August 31, 2020.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for information regarding the conversion of the $ 600.0 million principal amount of the Company’s Convertible Notes due 2026 into shares of the Company’s Common Stock in January 2021.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities for information regarding the conversion of the $ 600.0 million principal amount of the Company’s Convertible Notes due 2026 into shares of the Company’s Common Stock in January 2021.

As a result of the conversion, Silver Lake was no longer a related party of the Company.

During the year ended December 31, 2022, the Company repurchased $ 15.0 million aggregate principal of the Second Lien Notes due 2026 from Antara, which subsequently became a related party on February 7, 2023, for $ 5.9 million and recorded a gain on extinguishment of $ 12.0 million.

See Note 16—Subsequent Events for more information on transactions with Antara.

Treasury Stock

On February 27, 2020, the Company announced that its Board of Directors authorized a share repurchase program for an aggregate purchase of up to $ 200.0 million shares of Common Stock.

As of April 24, 2020, the Company is prohibited from making purchases under its authorized stock repurchase program in accordance with the covenant suspension conditions in its Credit Agreement (as defined in Note 8 — Corporate Borrowings and Finance Lease Obligations).

On February 27, 2020, the Company announced that its Board of Directors authorized a share repurchase program for an aggregate purchase of up to $ 200.0 million shares of Common Stock and up to $ 200.0 million shares of

AMC Preferred Equity Units.

As of April 24, 2020, the Company is prohibited from making purchases under its authorized stock repurchase program in accordance with the covenant suspension conditions in its Credit Agreement.

As of December 31, 2022, $ 200.0 million remained available for repurchase under this plan.

A three-year time limit had been set for the completion of this program, expiring February 26, 2023.

Special Dividend

On August 4, 2022 the Company announced that its Board of Directors declared a special dividend for one AMC Preferred Equity Unit for each share of Class A common stock outstanding at the close of business August 15, 2022, the record date.

The dividend was paid at the close of business August 19, 2022 to investors who held Class A common shares as of August 22, 2022, the ex-dividend date.

The Company has 50,000,000 Preferred Stock shares authorized, 10,000,000 of which have currently have been allocated and 7,245,872 have been issued under the depositary agreement as a Series A Convertible Participating Preferred Stock, leaving 40,000,000 unallocated Preferred Stock shares.

Each AMC Preferred Equity Unit is designed to have the same economic and voting rights as a share of Class A common stock.

Trading of the AMC Preferred Equity Units on the NYSE began on August 22, 2022 under the ticker symbol “APE”.

Due to the characteristics of the AMC Preferred Equity Units, the special dividend had the effect of a stock split pursuant to ASC 505-20-25-4.

Accordingly, all references made to share, per share, or common share amounts in the accompanying consolidated financial statements and applicable disclosures include Class A common stock and AMC Preferred Equity Units and have been retroactively adjusted to reflect the effects of the special stock dividend as a stock split.

Stock-Based Compensation

2013 Equity Incentive Plan

The 2013 Equity Incentive Plan provides for grants of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance stock units (“PSUs), stock awards, and cash performance awards.

The maximum number of shares of Holdings’ Common Stock available for delivery pursuant to awards granted under the second amendment to the 2013 Equity Incentive Plan is 15 million shares.

At December 31, 2021, the aggregate number of shares of Holdings’ Common Stock available for grant was 4,650,723 shares.

The 2013 Equity Incentive Plan, as amended (“EIP”), provides for grants of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance stock units (“PSUs), stock awards, and cash performance awards.

The maximum number of equity interests in Holdings available for delivery pursuant to awards granted under the EIP is 15 million shares of Common Stock and 7,306,354 AMC Preferred Equity Units.

At December 31, 2022, the aggregate number of equity interests in Holdings available for grant was 4,293,562 shares and 4,293,562 units, respectively.

The following table presents the stock-based compensation expense recorded within general and administrative:

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The Company accounts for forfeitures when they occur.

Plan Amendment due to stock split

The 2013 Plan contemplates equitable adjustments for certain transactions such as a stock split.

On August 19, 2022, the Compensation Committee approved an adjustment to the 2013 Equity Incentive Plan to entitle each participant one AMC Preferred Equity Unit and one share of Common Stock for each RSU or PSU that vests.

The Company determined that this modification was a Type 1 (probable-to-probable) modification that did not increase the fair value of the award and therefore did not require additional stock-based compensation expense to be recognized.

References made to share, per share, or common share amounts have been retroactively adjusted to reflect the effects of the stock split.

Awards Granted in 2022, 2021, and 2020 and Other Activity

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During years 2022, 2021, and 2020, the grant date fair value of these awards was based on the closing price of AMC’s stock on the date of grant, which ranged from $ 1.18 to $ 9.84 per share.

A dividend equivalent for restricted stock units and performance stock units equal to the amount paid in respect of

one share of Common Stock underlying the unit began to accrue with respect to the unit on the date of grant.

A dividend equivalent for restricted stock units and performance stock units equal to the amount paid in respect of one share of Common Stock and one AMC Preferred Equity Unit underlying the unit began to accrue with respect to the unit on the date of grant.

Such accrued dividend equivalents are paid to the holder upon vesting of the units.

Each unit represents the right to receive one share of Common Stock at a future date.

Each unit represents the right to receive one share of Common Stock and one AMC Preferred Equity Unit at a future date.

The award agreements generally had the following features:

● Board of Director Stock Award Agreement:

The Company granted fully vested shares of Common Stock to its independent members of AMC’s Board of Directors during the years ended December 31, 2021, Decembers 31, 2020, and December 31, 2019 of 124,054 , 77,090 , and 32,464 , respectively.

The Company granted fully vested shares of Common Stock and AMC Preferred Equity Units to its independent members of AMC’s Board of Directors during the years ended December 31, 2022, Decembers 31, 2021, and December 31, 2020 as follows:

December 31, 2022

December 31, 2021

December 31, 2020

AMC Preferred Equity Units

● Restricted Stock Unit Award Agreement:

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The Company records stock-based compensation expense on a straight-line recognition method over the requisite vesting period.

Each RSU represents the right to receive one share of Common Stock at a future date.

The RSUs granted during 2022, 2021, and 2020 vest over three years with 1/3 vesting in each year.

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These RSUs will be settled within 30 days of vesting.

● Restricted Stock Unit Named Executive Officer Award Agreement:

During the year ended December 31, 2017, RSU awards of 129,214 units were granted to certain executive officers covered by Section 162(m) of the Internal Revenue Code.

The RSUs vest over three years with 1/3 vesting each year if the cash flow from operating activities target was met.

The vested RSUs will be settled within 30 days of vesting.

The RSUs will be forfeited if AMC does not achieve a specified cash flow from operating activities target.

● Performance Stock Unit Award Agreement:

2022 PSU Awards.

On February 23, 2021, total PSUs of 2,687,813 were awarded (“2021 PSU award”) to certain members of management and executive officers, with the total PSUs divided into three separate year tranches, with each tranche allocated to a fiscal year within the performance period (“Tranche Year”).

During 2022, 1,394,270 total PSUs were awarded (“2022 PSU award”) to certain members of management and executive officers, with the total PSUs divided into three separate year tranches, with each tranche allocated to a fiscal year within the performance period (“Tranche Year”).

The PSUs within each Tranche Year are further divided between two performance targets;

the Adjusted EBITDA performance target and free cash flow performance target.

The 2021 PSU awards will vest based on achieving 80 % to 120 % of the performance targets, with the corresponding vested unit amount ranging from 50 % to 200 % (or 30 % to 200 % for PSU awards granted prior to year 2020).

The 2022 PSU awards will vest based on achieving 80 % to 120 % of the performance targets, with the corresponding vested unit amount ranging from 50 % to 200 % .

If the performance targets are met at 100%, the 2022 PSU awards will vest at 1,394,270 units in the aggregate.

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Therefore, the grant date (and fair value measurement date) for each Tranche Year is the date at the beginning of each year when a mutual understanding of the key terms and conditions are reached per ASC 718, Compensation - Stock Compensation.

The 2021 PSU award grant date fair value on February 23, 2021 for the 2021 Tranche Year award of 895,836 units was approximately $ 6.9 million, measured using performance targets at 100%.

At December 31, 2021, the 2021 Tranche Year target performance conditions for both the annual Adjusted EBITDA and free cash flow were achieved at 200 %.

The 2022 PSU award grant date fair value for the 2022 Tranche Year award was approximately $ 4.5 million and the 2021 PSU award grant date fair value for the 2022 Tranche Year award of 1,757,080 units was approximately $ 17.3 million, measured using performance targets at 100 %.

The 2020 PSU Award for the 2022 Tranche Year was previously granted in 2020, and was subsequently modified on October 30, 2020 where the grant date fair value was not determined until February 16, 2022 when the performance targets were established.

As a result, the 2020 PSU award grant date for the 2022 Tranche Year award of 859,366 units was approximately $ 8.5 million, measured using performance targets at 100 %.

At December 31, 2022, the 2022 Tranche Year target performance conditions for both the annual Adjusted EBITDA and free cash flow were achieved at 0 % and 79 %, respectively.

2021 PSU Awards.

On February 23, 2021, 5,375,626 total PSUs were awarded (“2021 PSU award”) to certain members of management and executive officers, with the total PSUs divided into three separate year tranches, with each tranche allocated to a fiscal year within the performance period (“Tranche Year”).

The PSUs within each Tranche Year are further divided between two performance targets;

the Adjusted EBITDA performance target and free cash flow performance target.

If the performance targets are met at 100 %, the 2021 PSU awards will vest at 5,375,626 units in the aggregate.

No PSUs will vest for each Tranche Year if the Company does not achieve 80% of the Tranche Year’s Adjusted EBITDA and free cash flow targets.

November 3, 2021 modification.

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2020 PSU Awards:

During the year ended December 31, 2020, PSU awards of 1,436,297 were granted to certain members of management and executive officers, with three-year cumulative Adjusted EBITDA and

free cash flow target conditions and service conditions, covering a performance period beginning January 1, 2020 and ending on December 31, 2022, prior to the service condition and performance condition modifications on November 3, 2021 and October 30, 2020, respectively.

During the year ended December 31, 2020, PSU awards of 2,872,594 were granted to certain members of management and executive officers, with three-year cumulative Adjusted EBITDA and free cash flow target conditions and service conditions, covering a performance period beginning January 1, 2020 and ending on December 31, 2022, prior to the service condition and performance condition modifications on November 3, 2021 and October 30, 2020, respectively.

2019 PSU Awards:

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In addition, the service conditions were modified, and vesting is now subject to the participant’s continued employment through the end of the three-year cumulative period.

The Company accounted for the modification in accordance with ASC 718-20, Compensation-Stock Compensation, as an exchange of the original award, that was not expected to vest, for a new award.

The Company accounted for the modification in accordance with ASC 718-20, Compensation-Stock Compensation, as an

exchange of the original award, that was not expected to vest, for a new award.

The Company measured the fair value of the new award on the modification date, October 30, 2020, because the Company determined that achieving performance thresholds were probable for certain tranche awards.

2017 PSU Awards:

During the year ended December 31, 2017, PSU awards were granted to certain members of management and executive officers with three-year cumulative net profit, Adjusted EBITDA, and diluted earnings per share performance target conditions and service conditions, covering a performance period beginning January 1, 2017 and ending on December 31, 2019.

The performance conditions were not met as of December 31, 2019 and the Company reversed previously recorded expense of $ 5.8 million on these units during the year ended December 31, 2019.

● Special Performance Stock Unit Executive Award Agreement:

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As a result of the SPSU modification of market conditions, the incremental fair value amount assigned to the grant date fair value was approximately $ 7.3 million in accordance with ASC 718-20, Compensation-Stock Compensation.

In January 2021, the market condition requirement for SPSUs was met as a result of exceeding the 20-day trailing volume weighted average stock price threshold target for tranche 5 and tranche 6 of $ 4 and $ 8 , respectively.

In January 2021, the market condition requirement for SPSUs was met as a result of

exceeding the 20-day trailing volume weighted average stock price threshold target for tranche 5 and tranche 6 of $ 4 and $ 8 , respectively.

The stock-based compensation costs for SPSUs were recorded on a straight-line basis through October 30, 2021, which was the end of the service requirement period.

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Beginning balance at January 1, 2020

Cancelled (1)

Beginning balance at January 1, 2020

( 4,944,750 )

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Beginning balance at January 1, 2021 (2)

( 1,297,720 )

Cancelled (1)

( 1,082,258 )

Nonvested at January 1, 2022

( 5,636,324 )

Cancelled (1)

( 4,746,590 )

Nonvested at December 31, 2022 (4)

Tranche Years 2022 and 2023 awarded under the 2021 PSU award with grant date fair values to be determined in years 2022 and 2023, respectively

Tranche Years 2023 and 2024 awarded under the 2022 PSU award and Tranche Year 2023 awarded under the 2021 PSU award with grant date fair values to be determined in years 2023 and 2024, respectively

Total Nonvested at December 31, 2022

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(2) Includes awards modified during 2020 where grant date fair value was not determined until 2021.

(3) During January and February of 2022, participants vested in RSUs and PSUs, net of units surrendered in lieu of taxes, of 2,799,845 units.

As a result, the Company paid taxes for restricted unit withholdings of approximately $ 52.2 million during the three months ended March 31, 2022 .

(3) The number of PSU shares granted under the Tranche Year 2022 is based on attainment of performance targets at 0 % for the Adjusted EBITDA target and 79 % for the free cash flow target.

(4) See Note 16 —Subsequent Events for information regarding vesting modifications to the 2022 PSUs.

NOTE 10—INCOME TAXES

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The ultimate realization of these deferred tax assets is dependent upon the generation of sufficient taxable income during future periods on a federal, state and foreign jurisdiction basis.

The Company conducts its evaluation by considering all available positive and negative evidence, including historical operating results, forecasts of future profitability, the duration of statutory carryforward periods, and the outlooks for the U.S.

The Company conducts its evaluation by considering all available positive and negative evidence, including historical operating results, forecasts of future profitability, the

duration of statutory carryforward periods, and the outlooks for the U.S.

motion picture and broader economy, among others.

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For the year ended December 31, 2022, the Company remained in a cumulative loss over the past three-year period for the U.S.

and international jurisdictions, with the exception of Norway and Finland.

and international jurisdictions except for Finland.

The Company maintains a valuation allowance against U.S.

deferred tax assets as well as international jurisdictions in which it operates, with the exception of Finland and Norway.

deferred tax assets as well as international jurisdictions in which it operates, with the exception of Finland.

During the first quarter of 2020, the severe impact of COVID-19 on operations in Germany and Spain caused the Company to conclude the realizability of deferred tax assets held in those jurisdictions does not meet the more likely than not standard.

As such, a charge of $ 33.1 million and $ 40.1 million was recorded for Germany and Spain, respectively.

Cancellation of Debt Income.

On July 31, 2020, the Company consummated previously announced private offers to exchange its Existing Subordinated Notes for newly issued Second Lien Notes due 2026.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for further information.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities for further information.

For US tax purposes the Company was required to recognize CODI on the difference between the face value of debt exchanged and the fair market value of the new debt issued.

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statutory tax rate primarily due to the valuation allowances in U.S.

and foreign jurisdictions, foreign tax rate differences, and federal and state tax credits, partially offset by state income taxes and permanent differences related to interest, compensation, and other discrete items.

and foreign jurisdictions, foreign tax rate differences, and federal and state tax credits, partially offset by permanent differences related to interest, compensation, and other discrete items.

Additionally, the Company recorded an immaterial error correction resulting in a $ 152.5 million net increase in deferred tax assets which were fully reserved with a valuation allowance during the year ended December 31, 2022.

The adjustment related to deferred tax assets associated with the cancellation of debt transactions which occurred during the period ended December 31, 2020.

No tax impact was recorded on the $ 2,306.4 million goodwill impairment charge incurred during the year ended December 31, 2020, as the portion impaired was permanently non-deductible.

At December 31, 2022 and December 31, 2021, the Company has recorded net deferred tax liabilities of $ 32.1 million and of $ 30.7 million, respectively.

On March 27, 2020, the U.S.

government enacted the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”).

The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property, as well as loans to certain qualifying businesses.

As of the date of this filing, the Company has not participated in CARES Act loans.

The income tax provision (benefit) reflected in the consolidated statements of operations consists of the following components:

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Foreign rate differential

Original issue discount

Impact of UK tax rate change

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Other credit carryovers

Other comprehensive income

Net operating loss carryforwards

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Valuation allowance-deferred income tax assets

(1) The 2021 valuation allowance primarily relates to the Company’s increase in the current year’s federal, state and international net operating losses, for which no benefit has been recognized.

(1) The 2022 valuation allowance primarily relates to the Company’s increase in the current year’s federal, state, international net operating losses and the $ 152.5 million immaterial error correction, for which no benefit has been recognized.

(2) Primarily relates to amounts resulting from the Company’s changes in deferred tax assets and associated valuation allowance that are not related to income statement activity as well as amounts charged to other comprehensive income.

In 2019, this includes $( 28.6 ) million of valuation allowance associated with the sale of the Austria theatres.

The Company has federal income tax net operating loss carryforwards of $ 1,712.5 million.

Approximately $ 320.6 million will begin to expire in 2022, and will completely expire in 2036, and will be limited annually due to certain change in ownership provisions of the Internal Revenue Code.

Approximately $ 320.6 million will expire between 2023 and 2036 and will be limited annually due to certain change in ownership provisions of the Internal Revenue Code.

Approximately $ 1,391.9 million can be used indefinitely.

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The Company analyzed and reviewed state uncertain tax positions to determine the necessity of accruing interest and penalties.

For the year ended December 31, 2021, the Company recognized $ 0.6 million of interest expense and $ 0.4 million of penalties.

For the year ended December 31, 2022, the Company recognized no interest expense or penalties.

For the year ended December 31, 2021, the Company recognized $ 0.6 million of interest expense and $ 0.4 million of penalties.

The total amount of accrued interest and penalties for state uncertain tax positions at December 31, 2021 and December 31, 2020 was $ 0 and $ 1.6 million, respectively.

The Company has no accrued interest and penalties for state uncertain tax positions at December 31, 2022 and December 31, 2021.

The total amount of net unrecognized tax benefits at December 31, 2022 and December 31, 2021 that would impact the effective tax rate, if recognized, would be $ 0.2 million and $ 0.3 million, respectively.

The Company believes that it is reasonably possible that approximately $ 0.2 million of its unrecognized tax positions related to state taxes may be recognized by the end of 2022 as a result of settlements or the expiration of statute of limitations.

The Company believes that it is reasonably possible that none of its unrecognized tax positions related to state taxes will be recognized by the end of 2023 as a result of settlements or the expiration of statute of limitations.

The Company, or one of its subsidiaries, files income tax returns in the U.S.

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District Court for the Southern District of New York.

The Actions, which name certain of the Company’s officers and directors and, in the case of the Hawaii Action, the underwriters of the Company’s February 8, 2017 secondary public offering, as defendants, assert claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) with respect to alleged material misstatements and omissions in the registration statement for the secondary public offering and in certain other public disclosures.

The Actions, which named certain of the Company’s officers and directors and, in the case of the Hawaii Action, the underwriters of the Company’s February 8, 2017 secondary public offering, as defendants, asserted claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) with respect to alleged material misstatements and omissions in the registration statement for the secondary public offering and in certain other public disclosures.

On May 30, 2018, the court consolidated the Actions.

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When the action was transferred to the Southern District of New York, it was re-captioned Gantulga v.

1:18-cv-10007-AJN.

1:18-cv-10007-

The parties filed a joint stipulation to stay the action, which the court granted on December 17, 2018.

The stay was lifted as of February 9, 2022.

On October 2, 2019, a stockholder derivative complaint, captioned Kenna v.

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On January 8, 2021, the Special Litigation Committee filed a report with the court recommending that the court dismiss all of the claims asserted in the Lao Action, and moved to dismiss all of the claims in the Lao Action.

The court has not yet ruled on the Special Litigation Committee’s motion to dismiss.

On June 6, 2022, the parties signed a stipulation of settlement to resolve the Lao Action for $ 17,375,000 (the “Settlement Amount”).

Defendants agreed to the settlement and the payment of the Settlement Amount solely to eliminate the burden, expense, and uncertainty of further litigation, and continue to expressly deny any liability or wrongdoing with respect to the matters alleged in the Lao Action.

On September 28, 2022, the court held a hearing to consider whether to approve the proposed settlement.

At the hearing, the court requested a supplemental notice to stockholders prior to approval.

A second hearing regarding approval of the settlement was held on November 30, 2022.

Following the hearing, also on November 30, 2022, the court issued an order and final judgment approving the settlement and dismissing the action.

The order and final judgment included a fee and expense award to Plaintiff’s counsel in the amount of $ 3,450,000 to be paid out of the

Settlement Amount.

The remainder of the Settlement Amount was paid to the Company on January 6, 2023.

See Note 16—Subsequent Events for further information.

On December 27, 2022, the Company received a letter from a purported stockholder, demanding to inspect certain of the Company’s books and records pursuant to 8 Del.

§ 220 in order to investigate allegations concerning:

(i) the proposal that was approved by the Board on January 27, 2021 to amend the Company’s Certificate of Incorporation to increase the total number of shares of the Company’s Common Stock;

(ii) the Company’s creation, distribution, and/or sale of AMC Preferred Equity Units (“APEs”);

(iii) the transactions between the Company and Antara Capital, LP that the Company announced on December 22, 2022 (the “Antara Transactions”);

(iv) the special meeting of the holders of the Company’s Common Stock and APEs to be held on March 14, 2023 for the purpose of voting on amendments to the Company’s Certificate of Incorporation that, together and if approved, will enable the APEs to convert into shares of the Company’s Common Stock:

and (v) the independence of the members of the Board (the “December 27, 2022 Demand”).

On January 4, 2023, the Company rejected the December 27, 2022 Demand.

On February 7, 2023, without conceding the propriety of the December 27, 2022 Demand in any respect and while reserving all rights, the Company, in an effort to avoid unnecessary litigation, allowed the stockholder who made the December 27, 2022 Demand to inspect certain of the Company’s books and records concerning the subject matter of December 27, 2022 Demand.

On February 6, 2023, the Company received a letter from another purported stockholder, demanding to inspect certain of the Company’s books and records pursuant to 8 Del.

§ 220 in order to investigate allegations similar to those made in the December 27, 2022 Demand (the “February 6, 2023 Demand” and, together with the December 27, 2022 Demand, the “Books and Records Demands”).

On February 13, 2023, the Company rejected the February 6, 2023 Demand.

Also, on February 13, 2023, without conceding the propriety of the February 6, 2023 Demand in any respect and while reserving all rights, the Company, in an effort to avoid unnecessary litigation, allowed the stockholder who made the February 6, 2023 Demand to inspect the same books and records that it allowed the stockholder who made the December 27, 2022 Demand to inspect.

On February 20, 2023, two putative stockholder class actions were filed in the Delaware Court of Chancery, captioned Allegheny County Employees’ Retirement System v.

AMC Entertainment Holdings, Inc., et al.

2023-0215-MTZ (Del.

Ch.) (the “ Allegheny Action”), and Munoz v.

2023-0216-MTZ (Del.

Ch.) (the “ Munoz Action”).

The Allegheny Action asserts a claim for breach of fiduciary duty against certain of the Company’s directors and a claim for breach of 8 Del.

§ 242(b) against those directors and the Company, arising out of the Company’s creation of the APEs, the Antara Transactions, and the Charter Amendment Proposals.

The Munoz Action, which was filed by the stockholders who made the Books and Records Demands, asserts a claim for breach of fiduciary duty against the Company’s current directors and former director Lee Wittlinger, arising out of the same conduct challenged in the Allegheny Action.

The Allegheny Action seeks a declaration that the issuance of the APEs violated 8 Del.

§ 242(b), an order that holders of the Company’s Common Stock be provided with a separate vote from the holders of the APEs on the Charter Amendment Proposals or that the APEs be enjoined from voting on the Charter Amendment Proposals, and an award of money damages.

The Munoz Action seeks to enjoin the APEs from being voted on the Charter Amendment Proposals.

On February 27, 2023, the Delaware Court of Chancery entered a status quo order that (i) will allow the March 14, 2023 vote on the Charter Amendment Proposals to proceed, but precludes the Company from implementing the Charter Amendment Proposals pending a ruling by the court on the plaintiffs’ to-be-filed preliminary injunction motion, and (ii) scheduled a hearing on the plaintiffs’ to-be-filed preliminary injunction motion for April 27, 2023.

NOTE 12—FAIR VALUE MEASUREMENTS

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Other long-term assets:

Money market mutual funds

Investments measured at net asset value (1)

Investment in Hycroft Mining Holding Corporation warrants

Marketable equity securities:

Investment in Hycroft Mining Holding Corporation

Total assets at fair value

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Investments measured at net asset value (1)

Marketable equity securities:

Investment in NCM

Total assets at fair value

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The Company has an equivalent liability for this related-party transaction recorded in other long-term liabilities for the deferred compensation obligation.

The plan was terminated on May 3, 2021 and will be liquidated in 2022.

The plan was terminated on May 3, 2021 and liquidated in 2022.

Valuation Techniques.

The Company’s money market mutual funds are invested in funds that seek to preserve principal, are highly liquid, and therefore are recorded on the balance sheet at the principal amounts deposited, which equals fair value.

The equity method investment in Hycroft was measured at fair value using Hycroft’s stock price at the date of measurement.

To estimate the fair value of the Company’s investment in Hycroft warrants, the Company valued the warrants using the Black Scholes pricing model.

Such judgments and estimates included estimates of volatility of 123.3 % and discount rate of 4.1 %.

The discount rate is based on the treasury yield that matches the term as of the measurement date.

Other inputs included the term of 4.2 years, exercise price of $ 1.068 and Hycroft’s stock price at the date of measurement.

There is considerable management judgment with respect to the inputs used in determining fair value, and, accordingly, actual results could vary significantly from such estimates, which fall under Level 3 within the fair value measurement hierarchy.

See Note 6—Investments for further information regarding the investments in Hycroft.

Nonrecurring Fair Value Measurements.

The following fair value hierarchy tables summarize the Company’s assets that were written down to their fair value on a nonrecurring basis:

The following fair value hierarchy tables summarize the Company’s assets that were written down to their fair value on a nonrecurring basis as part of our impairment evaluation:

Fair Value Measurements at December 31, 2022 Using

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active market

Total Impairment

(In millions)

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Property, net:

Operating lease right-of-use assets, net

Operating lease right-of-use assets, et

Other long-term assets

Property owned, net

Fair Value Measurements Using

Operating lease right-of-use assets

Fair Value Measurements at December 31, 2021 Using

Significant other

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active market

Total Impairment

(In millions)

Measurement Date

Property, net:

March 31, 2020

September 30, 2020

December 31, 2021

Operating lease right-of-use assets

March 31, 2020

Operating lease right-of-use assets

September 30, 2020

Operating lease right-of-use assets

December 31, 2020

Intangible assets, net

Definite-lived intangible assets

March 31, 2020

Indefinite-lived intangible assets

March 31, 2020

Definite-lived intangible assets

September 30, 2020

Indefinite-lived intangible assets

September 30, 2020

Indefinite-lived intangible assets

December 31, 2020

March 31, 2020

September 30, 2020

December 31, 2020

Property, net:

Operating lease right-of-use assets, net

Operating lease right-of-use assets, et

Other long-term assets

Cost method investments

March 31, 2020

Cost method investments

December 31, 2020

Equity method investments

December 31, 2020

Property owned, net

Valuation Techniques.

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Such judgments and estimates include estimates of future attendance, revenues, cash flows, rent relief, cost savings, capital expenditures, and the cost of capital, among others.

At December 31, 2021, related cash flows were discounted at 10.0 % for the Domestic Theatres and 11.5 % for the International Theatres, at December 31, 2020, related cash flows were discounted at 11.0 % for Domestic Theatres and 12.5 % for International Theatres, at September 30, 2020, related cash flows were discounted at 12.0 % for Domestic Theatres and 13.0 % for International Theatres, and at March 31, 2020, related cash flows were discounted at 11.5 % for Domestic Theatres and 13.0 % for International Theatres.

The Company used a long-term growth rate input of 1.0 %, except for the March 31, 2020 measurement date, which the Company used a long-term growth rate input of 2.0 %.

These estimates determine whether impairments have been incurred and quantify the amount of any related impairment charge.

To estimate fair value of the Company’s indefinite-lived trade names, the Company employed a derivation of the Income Approach known as the Royalty Savings Method.

The Royalty Savings Method values an intangible asset by estimating the royalties saved through ownership of the asset.

The Company applied royalty rates of 0.5 % for AMC and Odeon trade names and 1.0 % for Nordic trade names to the related theatre revenues on an after-tax basis using effective tax rates.

At December 31, 2020, related cash flows were discounted at 12.0 % for AMC and 13.5 % for Odeon and

Nordic, at September 30, 2020, related cash flows were discounted at 13.0 % for AMC and 14.0 % for Odeon and Nordic, and at March 31, 2020, related cash flows were discounted at 12.5 % for AMC and 14.0 % for Odeon and Nordic.

The Company performed the Step 1 quantitative goodwill impairment test as of March 31, 2020, September 30, 2020, and December 31, 2020.

In performing the Step 1 quantitative goodwill impairment test, the Company used an enterprise value approach to measure fair value of the reporting units.

In calculating the fair value of our Domestic Theatres and International Theatres reporting units by use the income approach for enterprise valuation methodology, which utilizes discounted cash flows.

The income approach provides an estimate of fair value by measuring estimated annual cash flows over a discrete projection period and applying a present value discount rate to the cash flows.

The present value of the cash flows is then added to the present value equivalent of the residual value of the business to arrive at an estimated fair value of the reporting unit.

At December 31, 2020, related cash flows were discounted at 11.0 % for Domestic Theatres and 12.5 % for International Theatres, at September 30, 2020, related cash flows were discounted at 12.0 % for Domestic Theatres and 13.0 % for International Theatres, and at March 31, 2020, related cash flows were discounted at 11.5 % for Domestic Theatres and 13.0 % for International Theatres.

The Company used a long-term growth rate input of 1.0 %, except for the March 31, 2020 measurement date, which the Company used a long-term growth rate input of 2.0 %.

At December 31, 2022, related cash flows were discounted at 10.0 % for the Domestic Theatres and 12.5 % for the International Theatres, at December 31, 2021, related cash flows were discounted at 10.0 % for Domestic Theatres and 11.5 % for International Theatres.

Other Fair Value Measurement Disclosures.

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The Company valued these notes at principal value less an estimated discount reflecting a market yield to maturity.

See Note 8 — Corporate Borrowings and Finance Lease Obligations for further information.

See Note 8 — Corporate Borrowings and Finance Lease Liabilities for further information.

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of these instruments.

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The Company divested of its interest in Estonia, Latvia, and Lithuania operations, see Note 1 — The Company and Significant Accounting Policies for further information on the Baltics theatre sale.

Operations located in Austria were sold during the first quarter of 2019.

Each segment’s revenue is derived from admissions, food and beverage sales and other ancillary

revenues, primarily screen advertising, AMC Stubs ® membership fees and other loyalty programs, ticket sales, gift card income and exchange ticket income.

On January 24, 2023 the Company sold its interest in Saudi Arabia, see Note 16 — Subsequent events for additional information.

Each segment’s revenue is derived from admissions, food and beverage sales and other ancillary revenues, primarily screen advertising, AMC Stubs ® membership fees and other loyalty programs, ticket sales, gift card income and exchange ticket income.

The measure of segment profit and loss the Company uses to evaluate performance and allocate its resources is Adjusted EBITDA, as defined in the reconciliation table below.

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The Company defines Adjusted EBITDA as net earnings (loss) plus (i) income tax provision (benefit), (ii) interest expense and (iii) depreciation and amortization, as further adjusted to eliminate the impact of certain items that the Company does not consider indicative of the Company’s ongoing operating performance and to include attributable EBITDA from equity investments in theatre operations in International markets and any cash distributions of earnings from its other equity method investees.

The measure of segment profit and loss the Company uses to evaluate performance and allocate its resources is Adjusted EBITDA, which is consistent with how Adjusted EBITDA is defined in the Company’s debt indentures.

The measure of segment profit and loss the Company uses to evaluate performance and allocate its resources is Adjusted EBITDA, which is broadly consistent with how Adjusted EBITDA is defined in the Company’s debt indentures.

Capital Expenditures (In millions)

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Other expense (income) (7)

Other non-cash rent expense (benefit) (8)

Other non-cash rent benefit (8)

General and administrative — unallocated:

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(2) During the year ended December 31, 2022, the Company recorded non-cash impairment charges related to its long-lived assets of $ 73.4 million on 68 theatres in the U.S.

markets with 817 screens which were related to property, net and operating lease right-of-use assets, net and $ 59.7 million on 53 theatres in the International markets with 456 screens which were related to property, net and operating lease right-of-use assets, net.

During the year ended December 31, 2021, the Company recorded non-cash impairment charges related to its long-lived assets of $ 61.3 million on 77 theatres in the U.S.

markets with 805 screens which were related to property, net, operating lease right-of-use assets, net and other long-term assets and $ 15.9 million on 14 theatres in the International markets with 118 screens which were related to property, net and operating lease right-of-use assets, net.

During the year ended December 31, 2020, the Company recorded goodwill non-cash impairment charges of $ 1,276.1 million and $ 1,030.3 million related to the enterprise fair values of the Domestic Theatres and International Theatres reporting units, respectively.

During the year ended December 31, 2020, the Company recorded non-cash impairment charges related to its long-lived assets of $ 152.5 million on 101 theatres in the U.S.

During the year ended December 31, 2020, the Company recorded non-cash impairment of long-lived assets of $ 152.5 million on 101 theatres in the U.S.

markets with 1,139 screens which were related to property, net, operating lease right-of-use assets, net and other long-term assets and $ 25.4 million on 37 theatres in the International markets with 340 screens which were related to property, net and operating lease right-of-use assets, net.

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The Company also recorded non-cash impairment charges of $ 14.4 million related to its definite-lived intangible assets in the Domestic Theatres reporting unit during the year ended December 31, 2020.

During the year ended December 31, 2019, the Company recorded non-cash impairment of long-lived assets of $ 84.3 million on 40 theatres in the U.S.

markets with 512 screens, 14 theatres in the International markets with 148 screens, and a U.S.

property held and not used.

(3) Amounts represent preopening expense related to temporarily closed screens under renovation, theatre and other closure expense for the permanent closure of screens, including the related accretion of interest, non-cash deferred digital equipment rent expense, and disposition of assets and other non-operating gains or losses included in operating expenses.

The Company has excluded these items as they are non-cash in nature or are non-operating in nature.

(4) Equity in (earnings) loss of non-consolidated entities primarily consisted of equity in earnings (loss) from DCIP of $ 12.2 million, $( 14.5 ) million and $ 25.4 million, during the year ended December 31, 2021, December 31, 2020, and December 31, 2019, respectively.

(4) Equity in (earnings) loss of non-consolidated entities primarily consisted of equity in loss from Saudi Cinema Company, LLC of $ 7.6 million, partially offset by equity in (earnings) from DCIP of $ 3.4 million during the year ended December 31, 2022.

Equity in (earnings) loss of non-consolidated entities primarily consisted of equity in earnings (loss) from DCIP of $ 12.2 million and $( 14.5 ) million, during the year ended December 31, 2021, and December 31, 2020, respectively.

In addition, the Company recorded impairment losses in the International markets during the year ended December 31, 2020 related to equity method investments of $ 8.6 million in equity in (earnings) loss of non-consolidated entities.

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Equity in (earnings) loss of non-consolidated entities excluding International theatre joint ventures

Equity in earnings (loss) of International theatre joint ventures

Income tax expense

Investment income

Equity in loss of International theatre joint ventures

Income tax provision

Investment expense (income)

Interest expense

Impairment of long-lived assets

Depreciation and amortization

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Attributable EBITDA

(7) Other expense (income) during the year ended December 31, 2021, primarily consisted of a loss on debt extinguishment of $ 14.4 million and financing fees of $ 1.0 million, partially offset by income related to the foreign currency transaction gains of $( 9.8 ) million and contingent lease guarantees of $( 5.7 ) million.

Other expense (income) for the year ended December 31, 2020 included a loss of $ 109.0 million related to the fair value adjustments of the Company’s derivative liability and derivative asset for the Convertible Notes, financing fees related to the Exchange Offer of $ 39.3 million, and credit losses related to contingent

lease guarantees of $ 15.0 million, partially offset due to a gain on extinguishment of the Second Lien Notes due 2026 of $( 93.6 ) million.

During the year ended December 31, 2019, the Company recorded a loss on repayment of indebtedness of $ 16.6 million and the financing related foreign currency transaction losses, partially offset by a gain of $ 5.8 million as a result of the decrease in fair value of its derivative liability and asset for the Convertible Notes.

(7) Other expense (income) during the year ended December 31, 2022, primarily consisted of a loss on debt extinguishment of $ 92.8 million, partially offset by income related to the foreign currency transaction gains of $( 12.3 ) million and contingent lease guarantees of $( 0.2 ) million.

Other expense (income) for the year ended December 31, 2021, primarily consisted of a loss on debt extinguishment of $ 14.4 million and financing fees of $ 1.0 million, partially offset by income related to the foreign currency transaction gains of $( 9.8 ) million and contingent lease guarantees of $( 5.7 ) million.

During the year ended December 31, 2020 included a loss of $ 109.0 million related to the fair value adjustments of the Company’s derivative liability and derivative asset for the Convertible Notes, financing fees related to the Exchange Offer of $ 39.3 million, and credit losses related to contingent lease guarantees of $ 15.0 million, partially offset due to a gain on extinguishment of the Second Lien Notes due 2026 of $( 93.6 ) million.

(8) Reflects amortization of certain intangible assets reclassified from depreciation and amortization to rent expense due to the adoption of ASC 842, Leases and deferred rent benefit related to the impairment of right-of-use operating lease assets.

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Balance December 31, 2020

Other comprehensive income (loss) before reclassifications

Amounts reclassified from accumulated other comprehensive loss

Balance December 31, 2020

Other comprehensive income (loss)

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Balance December 31, 2021

Other comprehensive income (loss)

Balance December 31, 2022

The tax effects allocated to each component of other comprehensive income (loss) is as follows:

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Net gain (loss) arising during the period, net of tax

Equity method investee's cash flow hedge:

Unrealized net holding loss arising during the period

Other comprehensive income (loss)

NOTE 15—LOSS PER SHARE

On August 4, 2022, the Company announced that its Board of Directors declared a special dividend of one AMC Preferred Equity Unit for each share of Common Stock outstanding at the close of business on August 15, 2022, the record date.

The dividend was paid at the close of business on August 19, 2022 to investors who held shares of Common Stock as of August 22, 2022, the ex-dividend date.

The Company has 50,000,000 Preferred Stock shares authorized, 10,000,000 of which have currently been allocated and 7,245,872 have been issued under depositary agreement as Series A Convertible Participating Preferred Stock, leaving 40,000,000 unallocated Preferred Stock shares.

Each AMC Preferred Equity Unit is designed to have the same economic and voting rights as a share of Class A common stock.

Trading of the AMC Preferred Equity Units on the NYSE began on August 22, 2022 under the ticker symbol “APE”.

Due to the characteristics of the AMC Preferred Equity Units, the special dividend is similar to a stock split pursuant to ASC 505-20-25-4.

Accordingly, all references made to share, per share, or common share amounts in the accompanying consolidated financial statements and applicable disclosures have been retroactively adjusted to reflect the effects of the special dividend as a stock split.

Basic loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding.

Diluted loss per share includes the effects of unvested RSUs with a service condition only and unvested contingently issuable RSUs and PSUs that have service and performance conditions, if dilutive.

Diluted loss per share for the years ended December 31, 2020 and December 31, 2019 also includes potential dilutive shares from the conversion feature of the Convertible Notes due 2026, if dilutive.

Diluted loss per share for the year ended December 31, 2020 also includes potential dilutive shares from the conversion feature of the Convertible Notes due 2026, if dilutive.

The following table sets forth the computation of basic and diluted loss per common share:

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Diluted loss per common share:

Vested RSUs, PSUs, and SPSUs have dividend rights identical to the Company’s Common Stock and are treated as outstanding shares for purposes of computing basic and diluted earnings per share.

Vested RSUs, PSUs, and SPSUs have dividend rights identical to the Company’s Common Stock and AMC Preferred Equity Units and are treated as outstanding shares for purposes of computing basic and diluted earnings per share.

For the year ended December 31, 2022, December 31, 2021, and December 31, 2020, unvested RSUs of 2,523,364 , 4,495,250 , and 2,262,666 , respectively, were not included in the computation of diluted earnings (loss) per share because they would be anti-dilutive.

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Unvested PSUs of 0 , 0 and 1,298,418 for the years ended December 31, 2022, December 31, 2021, and December 31, 2020, respectively, and unvested SPSUs of 1,156,656 at the minimum market condition for the year ended December 31, 2020, were not included in the computation of diluted loss per share because they would not be issuable if the end of the reporting period were the end of the contingency period or they would be anti-dilutive.

On January 29, 2021, the $ 600.0 million principal amount of the Company’s Convertible Notes due 2026 were converted into the Company’s Common Stock at a conversion price of $ 13.51 per share and resulted in the issuance of 44,422,860 shares.

For both the years ended December 31, 2020 and December 31, 2019, the Company used the if-converted method for calculating any potential dilutive effect of the Convertible Notes that were issued on September 14, 2018.

The Company has not adjusted net loss for the year ended December 31, 2020 and December 31, 2019 to eliminate the interest expense of $ 31.8 million and $ 32.6 million, respectively, and the loss (gain) for the derivative liability related to the Convertible Notes of $ 89.4 million and $( 23.5 ) million, respectively, in the computation of diluted loss per share because the effects would be anti-dilutive.

The Company has not included in diluted weighted average shares approximately 35.5 million and 31.7 million shares issuable upon conversion for the years ended December 31, 2020 and December 31, 2019, respectively, as the effects would be anti-dilutive.

On January 29, 2021, the $ 600.0 million principal amount of the Company’s Convertible Notes due 2026 were converted into the Company’s Common Stock at a conversion price of $ 6.76 per share and resulted in the issuance of 44,422,860 shares and 44,422,860 AMC Preferred Equity Units.

For the year ended December 31, 2020, the Company used the if-converted method for calculating any potential dilutive effect of the Convertible Notes that were issued on September 14, 2018.

The Company has not adjusted net loss for the year ended December 31, 2020 to eliminate the interest expense of $ 31.8 million and the loss for the derivative liability related to the Convertible Notes of $ 89.4 million in the computation of diluted loss per share because the effects would be anti-dilutive.

The Company has not included in diluted weighted average shares approximately 71.0 million shares issuable upon conversion for the year ended December 31, 2020 as the effects would be anti-dilutive.

NOTE 16— SUBSEQUENT EVENTS

First Lien Senior Secured Notes due 2029.

On February 14, 2022, the Company issued $ 950.0 million aggregate principal amount of its 7.5 % First Lien Senior Secured Notes due 2029 (“First Lien Notes due 2029”).

The First Lien Notes due 2029 bear cash interest at a rate of 7.5 % per annum payable semi-annually in arrears on February 15 and August 15, beginning on August 15, 2022.

The First Lien Notes due 2029 are guaranteed on a senior secured basis by each of the Company’s subsidiaries that guarantees indebtedness under the Company’s Senior Secured Credit

Facilities and existing secured notes.

The Company used the net proceeds from the sale of the notes, and cash on hand, to fund the full redemption of the $ 500 million aggregate principal amount of the First Lien Notes due 2025, the $ 300 million aggregate principal amount of the First Lien Notes due 2026, and $ 73.5 million aggregate principal amount of the First Lien Toggle Notes due 2026 and to pay related accrued interest, fees, costs, premiums and expenses.

The Company estimates it will record a loss on debt extinguishment related to this transaction of approximately $ 135 million in other expense in 2022.

Equity Distribution Agreement.

As part of the Equity Distribution Agreement described in Note 9—Stockholders’ Equity, the Company raised gross proceeds of approximately $ 9.6 million through the date of this filing through its at-the-market offering of approximately 6.6 million shares of its AMC Preferred Equity Units and paid fees to the sales agent of approximately $ 0.2 million.

The Company is prohibited from selling more than $ 140.0 million worth of AMC Preferred Equity units until the earlier of the special stockholders meeting described below or April 6, 2023.

Antara is prohibited from purchasing more than 26 million AMC Preferred Equity Units until the earlier of the special stockholders meeting or April 6, 2023.

Stock-Based Compensation.

On February 23, 2023, AMC’s Board of Directors approved a modification to the 2022 PSU awards which lowered the Adjusted EBITDA and free cash flow performance targets such that 200 % vesting was achieved for both tranches.

This modification resulted in the immediate additional vesting of 2,389,589 Common Stock 2022 PSUs and 2,389,589 AMC Preferred Equity Unit 2022 PSUs.

This was treated as a Type 3 modification

(improbable-to-probable) which requires the Company to recognize additional stock compensation expense based on the modification date fair values of the Common Stock PSUs and AMC Preferred Equity Unit PSUs of $ 6.23 and $ 2.22 , respectively.

The Company will recognize $ 20.2 million of additional stock compensation expense in its financial statements during the three months ended March 31, 2023.

Other Information of this form 10-K for further information.

Additional Share Issuances Antara.

On February 7, 2023, the Company issued 197,621,297 AMC Preferred Equity Units to Antara in exchange for $ 75.1 million in cash and $ 100.0 million aggregate principal of the Company’s 10 %/ 12 % Cash/PIK Toggle Second Lien Notes due 2026.

The cash proceeds of $ 75.1 million and the carrying value of the notes of $ 118.6 million were recorded in Total stockholders’ deficit.

The Company paid $ 1.4 million of accrued interest in cash upon exchange of the notes.

On February 9, 2023, the Company and Antara agreed to a mutual waiver of the lock-up restrictions in the Forward Purchase Agreement restricting the sale, transfer, or other disposition of the AMC Preferred Equity Units.

In accordance with the mutual waiver, the lock-up restrictions will not apply to (i) sales of AMC Preferred Equity Units by Antara in an amount not to exceed an aggregate of 26 million AMC Preferred Equity Units, and (ii) allow additional sales of AMC Preferred Equity Units by the Company in an amount not to exceed $ 140 million.

The Company also agreed that prior to March 31, 2023, it will not issue or exchange, without Antara’s prior written consent, any Common Stock in return for cancellation of the Company’s outstanding indebtedness.

Senior Secured Credit Facility.

On January 25, 2023, the Company entered into the Twelfth Amendment, pursuant to which the requisite revolving lenders party thereto agreed to extend the suspension period for the financial covenant under its Credit Agreement from a period ending March 31, 2023 to a period ending on March 31, 2024.

Derivative Stockholder Complaint .

On January 6, 2023, the Company received approximately $ 14.0 million in settlement of the Lao Action as described in Note 11—Commitments and Contingencies.

The Company expects to record the settlement as a credit to other income during the three months ended March 31.

Saudi Cinema Company.

On December 30, 2022, the Company entered into an agreement to sell its 10.0 % investment in Saudi Cinema Company, LLC for SAR 112.5 million ($ 30.0 ) million, subject to certain closing conditions.

On January 24, 2023, the Saudi Ministry of Commerce recorded the sale of equity and the Company received the proceeds on January 25, 2023.

The Company expects to record a gain on the sale of approximately $ 15.5 million in investment income during the three months ended March 31, 2023.

Debt Repurchases.

The below table summarizes the cash debt repurchase transactions during January and February 2023, including related party transactions with Antara, which became a related party on February 7, 2023:

Aggregate Principal

Reacquisition

Accrued Interest

(In millions)

Extinguishment

Related party transactions:

Second Lien Notes due 2026

5.875 % Senior Subordinated Notes due 2026

Total related party transactions

Non-related party transactions:

Second Lien Notes due 2026

Total non-related party transactions

Total debt repurchases

Special Meeting of Stockholders.

Subsequent to the fiscal year ended December 31, 2022, the Board called a special meeting of the Company’s stockholders for March 14, 2023 (the “Special Meeting”).

At the Special Meeting, the Company’s stockholders will consider the following proposals:

To approve an amendment to our Third Amended and Restated Certificate of Incorporation (our “Certificate of Incorporation”) to increase the total number of authorized shares of Common Stock from 524,173,073 shares of Common Stock to 550,000,000 shares of Common Stock (the “Share Increase Proposal”);

To approve an amendment to our Certificate of Incorporation to effectuate a reverse stock split at a ratio of one share of Common Stock for every ten shares of Common Stock, which together with the Share

Increase Proposal, shall permit the full conversion of all outstanding shares of Series A Preferred Stock into shares of Common Stock (the “Reverse Split Proposal” and collectively with the Authorized Share Increase Proposal, the “Charter Amendment Proposals”).

See Note 11—Commitments and Contingencies for further information;

To approve one or more adjournments of the Special Meeting, if necessary, to permit further solicitation of proxies if there are not sufficient votes at the time of the Special Meeting to approve and adopt the Charter Amendment Proposals (the “Adjournment Proposal”).

Each of the Share Increase Proposal and the Reverse Split Proposal is cross-conditioned on the approval of the other, such that approval of both proposals is required for each of them to take effect.

If the Charter Amendment Proposals are approved, the number of our outstanding shares of Common Stock as of February 8, 2023, the record date for the Special Meeting, would decrease from 517,580,416 to approximately 51,758,042 shares of Common Stock.

Further, 9,298,497 shares of Series A Preferred Stock (represented by 929,849,612 APEs), as of the record date, will convert into 92,984,970 shares of Common Stock and the Series A Preferred Stock (and APEs) will cease to exist.

Ultimately, based upon the outstanding equity interests as of the record date, approval of the Charter Amendment Proposals will result in a total of approximately 144,743,012 shares of Common Stock outstanding out of 550,000,000 authorized shares.

The amount of Preferred Stock authorized in the Certificate of Incorporation will be unaffected by the Charter Amendment Proposals.

For additional information on the Special Meeting and the proposals under consideration, see the Company’s definitive proxy statement on Schedule 14A filed on February 14, 2023.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure .

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data