What changed in this filing

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Item 1. Financial Statements

2024-08-02 compared with 2024-05-08 · 346 added, 179 removed, 714 unchanged (42% of the section changed)

3 unchanged sentences

Three Months Ended

Six Months Ended

(In millions, except share and per share amounts)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Food and beverage

10 unchanged sentences

Operating costs and expenses

Operating loss

Other expense, net:

Operating income (loss)

Other expense (income), net

Other expense (income)

3 unchanged sentences

Non-cash NCM exhibitor services agreement

Investment income

Total other expense, net

Net loss before income taxes

Investment expense (income)

Total other expense (income), net

Earnings (loss) before income taxes

Income tax provision

Net loss per share:

Basic and diluted

Net earnings (loss)

Net earnings (loss) per share:

Average shares outstanding:

Basic and diluted (in thousands)

Basic (in thousands)

Diluted (in thousands)

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

Other comprehensive loss:

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Net earnings (loss)

Other comprehensive income (loss):

Unrealized foreign currency translation adjustments

1 unchanged sentence

Net loss (gain) arising during the period

Other comprehensive loss

Other comprehensive income (loss)

Total comprehensive loss

3 unchanged sentences

(In millions, except share data)

March 31, 2024

June 30, 2024

December 31, 2023

29 unchanged sentences

Preferred stock, $ .01 par value per share, 50,000,000 shares authorized;

no shares issued and outstanding as of March 31, 2024, and December 31, 2023

no shares issued and outstanding as of June 30, 2024, and December 31, 2023

Class A common stock ($ .01 par value, 550,000,000 shares authorized;

263,604,984 shares issued and outstanding as of March 31, 2024;

361,354,955 shares issued and outstanding as of June 30, 2024;

550,000,000 authorized;

8 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

Cash flows from operating activities:

8 unchanged sentences

Gain on disposition of Saudi Cinema Company

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

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

Landlord contributions

16 unchanged sentences

Scheduled principal payments under Term Loan due 2026

Net (disbursements) proceeds from equity issuances

Net proceeds from equity issuances

Principal payments under finance lease obligations

1 unchanged sentence

Taxes paid for restricted unit withholdings

Net cash (used in) provided by financing activities

Net cash provided by financing activities

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

8 unchanged sentences

Other third-party equity issuance costs payable

Deferred financing costs payable

Extinguishment of Second Lien Notes due 2026 in exchange for share issuance

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2024

June 30, 2024

NOTE 1—BASIS OF PRESENTATION

9 unchanged sentences

In the opinion of management, these interim financial statements reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the Company’s financial position and results of operations.

Due to the seasonal nature of the Company’s business, results for the three months ended March 31, 2024, are not necessarily indicative of the results to be expected for the year ending December 31, 2023.

Due to the seasonal nature of the Company’s business, results for the six months ended June 30, 2024, are not necessarily indicative of the results to be expected for the year ending December 31, 2024.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

5 unchanged sentences

The Company concluded that this change in conversion ratio is analogous to a reverse stock split of the AMC Preferred Equity Units even though the reverse stock split did not have an effect on the number of AMC Preferred Equity Units outstanding.

Accordingly, all references made to share, per share, unit, per unit, or common share amounts in the accompanying condensed consolidated financial statements and applicable disclosures have been retroactively adjusted to reflect the reverse stock split.

References made to AMC Preferred Equity Units have been retroactively adjusted to reflect the effect of the reverse stock split on their equivalent Common Stock shares.

Accordingly, all references made to share, per share, unit, per unit, or common share amounts in the accompanying condensed consolidated financial statements and applicable disclosures for periods prior to August 24, 2023, have been retroactively adjusted to reflect the reverse stock split.

References made to AMC Preferred Equity Units have also been retroactively adjusted to reflect the effect of the reverse stock split on their equivalent Common Stock shares.

On August 25, 2023, all of the Company’s outstanding AMC Preferred Equity Units converted into shares of Common Stock.

The Company believes its existing cash and cash equivalents, together with cash generated from operations, will be sufficient to fund its operations and satisfy its obligations currently and through the next twelve months.

As of March 31, 2024, the Company was subject to a minimum liquidity requirement of $ 100.0 million as a condition to the financial covenant suspension period under the Credit Agreement.

As of April 19, 2024, and in anticipation of the maturity of the Senior Secured Revolving Credit Facility, the Company voluntarily terminated the commitments under the Senior Secured Revolving Credit Facility in full and paid off any remaining obligations with respect to the Senior Secured Revolving Credit Facility.

2 unchanged sentences

The Company currently does not expect to replace the Senior Secured Revolving Credit Facility.

As of March 31, 2024, the Company had $ 9.2 million of letters of credit outstanding under the Senior Secured Revolving Credit Facility.

The Company has entered into a new letter of credit facility in order to continue to provide letters of credit in the ordinary course of business following the termination of the Senior Secured Revolving Credit Facility.

The Company has entered into a new letter of credit facility in order to continue to provide letters of

credit in the ordinary course of business following the termination of the Senior Secured Revolving Credit Facility.

The Company’s cash burn rates are not sustainable long-term.

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

North American box office grosses were down approximately 32 % for the three months ended March 31, 2024, compared to the three months ended March 31, 2019.

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

North American box office grosses were down approximately 36 % for the six months ended June 30, 2024, compared to the six months ended June 30, 2019.

Until such time as the Company is able to achieve sustainable net positive operating cash flow, it is difficult to estimate the Company’s future cash burn rates and liquidity requirements.

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

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

Additionally, the effects of labor stoppages, including but not limited to the Writers Guild of America strike and the Screen Actors Guild – American Federation of Television and Radio Artists strike that occurred during 2023 cannot be reasonably estimated and have had, and are expected to continue to have, a negative impact in 2024 on the film slate for exhibition, the Company’s future liquidity and cash burn rates.

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

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

Additionally, the effects of labor stoppages, including but not limited to the Writers Guild of America strike and the Screen Actors Guild – American Federation of Television and Radio Artists strike that occurred during 2023 had a negative impact in 2024 on the film slate for exhibition, the Company’s liquidity and cash burn rates.

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.

2 unchanged sentences

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

During the three months ended March 31, 2024, the Company executed a debt for equity exchange transaction.

This transaction was treated as an early extinguishment of the debt.

See Note 13—Subsequent Events for more information about various debt refinancing transactions that occurred subsequent to June 30, 2024.

The below table summarizes the various debt for equity exchange transactions that occurred during the six months ended June 30, 2024.

The transactions were treated as early extinguishment of the debt.

In accordance with ASC 470-50-40-3, the reacquisition price of the extinguished debt was determined to be the fair value of the Common Stock exchanged.

The below table summarizes the debt for equity exchange.

See Note 6—Corporate Borrowings and Finance Lease Liabilities and Note 7—Stockholders’ Deficit.

4 unchanged sentences

Second Lien Notes due 2026

During the six months ended June 30, 2024, the Company raised gross proceeds of $ 250.0 million and paid fees to sales agents and incurred other third-party issuance costs of approximately $ 6.3 million and $ 0.6 million, respectively, through its at-the-market offering of approximately 72.5 million shares of Common Stock.

The Company paid $ 0.7 million of other third-party issuance costs during the six months ended June 30, 2024.

Cash and Cash Equivalents.

As of March 31, 2024, cash and cash equivalents for the U.S.

As of June 30, 2024, cash and cash equivalents for the U.S.

markets and International markets were $ 655.7 million and $ 114.6 million respectively, and as of December 31, 2023, cash and cash equivalents were $ 752.3 million and $ 132.0 million, respectively.

3 unchanged sentences

(In millions)

March 31, 2024

June 30, 2024

December 31, 2023

2 unchanged sentences

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

As of March 31, 2024, restricted cash for the U.S.

As of June 30, 2024, restricted cash for the U.S.

markets and International markets were $ 20.0 million and $ 28.3 million, respectively.

6 unchanged sentences

Balance December 31, 2023

Other comprehensive loss

Balance March 31, 2024

Other comprehensive income (loss)

Balance June 30, 2024

Accumulated Depreciation and Amortization.

Accumulated depreciation was $ 3,152.4 million and $ 3,109.8 million as of March 31, 2024, and December 31, 2023, respectively, related to property.

Accumulated amortization of intangible assets was $ 7.5 million and $ 7.3 million as of March 31, 2024, and December 31, 2023, respectively.

Accumulated depreciation was $ 3,197.1 million and $ 3,109.8 million as of June 30, 2024, and December 31, 2023, respectively, related to property.

Accumulated amortization of intangible assets was $ 7.7 million and $ 7.3 million as of June 30, 2024, and December 31, 2023, respectively.

Other Expense (Income).

1 unchanged sentence

Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Foreign currency transaction (gains) losses

4 unchanged sentences

Derivative stockholder settlement

Shareholder litigation

Shareholder litigation and recoveries

Vendor dispute settlement

Other settlement proceeds

Business interruption insurance recoveries

Total other expense (income)

8 unchanged sentences

Three Months Ended

Six Months Ended

(In millions)

17 unchanged sentences

Cash flow and supplemental information is presented below:

Three Months Ended

Six Months Ended

(In millions)

4 unchanged sentences

Landlord contributions:

Operating cashflows provided by operating leases

Operating cash flows provided by operating leases

Supplemental disclosure of noncash leasing activities:

1 unchanged sentence

(1) Includes lease extensions and option exercises.

The following table represents the weighted-average remaining lease term and discount rate as of March 31, 2024:

The following table represents the weighted-average remaining lease term and discount rate as of June 30, 2024:

Weighted Average

4 unchanged sentences

Finance leases

Minimum annual payments and the net present value thereof as of March 31, 2024, are as follows:

Minimum annual payments and the net present value thereof as of June 30, 2024, are as follows:

Operating Lease

1 unchanged sentence

(In millions)

Nine months ending December 31, 2024

Six months ending December 31, 2024

Total lease payments

1 unchanged sentence

Total operating and finance lease liabilities, respectively

As of March 31, 2024, the Company had signed additional operating lease agreements for two theatres that have not yet commenced.

As of June 30, 2024, the Company had signed additional operating lease agreements for three theatres that have not yet commenced.

These leases have terms ranging from 15 to 20 years and total lease payments of approximately $ 68.9 million.

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

During the three months ended March 31, 2023, the Company received a $ 13.0 million buyout incentive from a landlord which provided the landlord the right to terminate the lease of one theatre.

During the six months ended June 30, 2023, the Company received a $ 13.0 million buyout incentive from a landlord which provided the landlord the right to terminate the lease of one theatre.

The incentive was treated as a reduction to rent expense in the Company’s condensed consolidated statement of operations.

3 unchanged sentences

Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Major revenue types

5 unchanged sentences

Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Timing of revenue recognition

3 unchanged sentences

(1) Amounts primarily include subscription and advertising revenues.

The following tables provide the balances of receivables, net and deferred revenues and income as of March 31, 2024, and December 31, 2023:

The following tables provide the balances of receivables, net and deferred revenues and income as of June 30, 2024, and December 31, 2023:

(In millions)

March 31, 2024

June 30, 2024

December 31, 2023

4 unchanged sentences

(In millions)

March 31, 2024

June 30, 2024

December 31, 2023

19 unchanged sentences

Foreign currency translation adjustment

Balance March 31, 2024

Balance June 30, 2024

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

8 unchanged sentences

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

Balance March 31, 2024

Balance June 30, 2024

(1) Represents the carrying amount of the National CineMedia, LLC (“NCM”) common units that were previously received under the annual Common Unit Adjustment (“CUA”) and subsequent adjustments related to the NCM bankruptcy, as discussed in greater detail below.

10 unchanged sentences

Gift Cards and Exchange Tickets.

The total amount of non-redeemed gift cards and exchange tickets included in deferred revenues and income in the condensed consolidated balance sheet as of March 31, 2024 was $ 299.4 million.

The total amount of non-redeemed gift cards and exchange tickets included in deferred revenues and income in the condensed consolidated balance sheet as of June 30, 2024 was $ 293.8 million.

This will be recognized as revenues as the gift cards and exchange tickets are redeemed or as the non-redeemed gift card and exchange ticket revenues are recognized in proportion to the pattern of actual redemptions, which is estimated to occur over the next 24 months .

Loyalty Programs.

As of March 31, 2024, the amount of deferred revenues allocated to the loyalty programs included in deferred revenues and income in the condensed consolidated balance sheet was $ 73.3 million.

As of June 30, 2024, the amount of deferred revenues allocated to the loyalty programs included in deferred revenues and income in the condensed consolidated balance sheet was $ 74.5 million.

The earned points will be recognized as revenue as the points are redeemed, which is estimated to occur over the next 24 months .

2 unchanged sentences

NOTE 4—GOODWILL

The following table summarizes the changes in goodwill by reporting unit for the three months ended March 31, 2024:

The following table summarizes the changes in goodwill by reporting unit for the six months ended June 30, 2024:

International

12 unchanged sentences

Currency translation adjustment

Balance March 31, 2024

Balance June 30, 2024

NOTE 5—INVESTMENTS

1 unchanged sentence

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), and 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 recorded a gain on the sale of $ 15.5 million in investment income during the three months ended March 31, 2023.

Investments in non-consolidated affiliates as of March 31, 2024 include interests in Digital Cinema Distribution Coalition, LLC of 14.6 %, AC JV, LLC (“AC JV”), owner of Fathom Events, of 32.0 %, SV Holdco LLC, owner of Screenvision, of 18.4 %, Digital Cinema Media Ltd.

(“DCM”) of 50.0 %, Handelsbolaget Svenska Bio Lidingo of 50.0 %, Bergen Kino AS for 49.0 %, Odeon Kino Stavanger/Sandnes AS of 49.0 %, Capa Kinoreklame AS (“Capa”) of 50.0 % and Vasteras Biografer (“Vasteras”) of 50.0 %.

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

motion picture theatres and approximately 50.0 % interests in 62 theatres in Europe.

The Company recorded a gain on the sale of $ 15.5 million in investment income during the six months ended June 30, 2023.

Investments in non-consolidated affiliates as of June 30, 2024 include interests in Digital Cinema Distribution Coalition, LLC of 14.6 %, AC JV, LLC (“AC JV”), owner of Fathom Events, of 32.0 %, SV Holdco LLC, owner of Screenvision, of 18.4 %, Digital Cinema Media Ltd.

(“DCM”) of 50.0 %, Handelsbolaget Svenska Bio Lidingo of 50.0 %, Bergen Kino AS of 49.0 %, Odeon Kino Stavanger/Sandnes AS of 49.0 %, Capa Kinoreklame AS (“Capa”) of 50.0 % and Vasteras Biografer (“Vasteras”) of 50.0 %.

Through its various investments the Company has interests in four U.S.

theatres and 62 theatres in Europe.

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

During the three months ended March 31, 2024 and March 31, 2023, the Company recorded equity in earnings of non-consolidated entities of $( 3.7 ) million and $( 1.4 ) million, respectively.

During the three months ended June 30, 2024 and June 30, 2023, the Company recorded equity in earnings of non-consolidated entities of $( 1.0 ) million and $( 0.8 ) million, respectively.

During the six months ended June 30, 2024 and June 30, 2023, the Company recorded equity in earnings of $( 4.7 ) million and $( 2.2 ) million, respectively.

Related Party Transactions

1 unchanged sentence

(In millions)

March 31, 2024

June 30, 2024

December 31, 2023

7 unchanged sentences

Three Months Ended

Six Months Ended

(In millions)

Consolidated Statements of Operations

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

DCM screen advertising revenues

7 unchanged sentences

Investment in Hycroft

The Company holds 2.4 million units of Hycroft Mining Holding Corporation (NASDAQ:

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

The Company holds approximately 2.4 million common shares of Hycroft Mining Holding Corporation (NASDAQ:

HYMC) (“Hycroft”) and approximately 2.3 million warrants to purchase common shares.

Each warrant is exercisable for one common share of Hycroft at a price of $ 10.68 per share over a 5-year term through March 2027.

3 unchanged sentences

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 three months ended March 31, 2024 and March 31, 2023, the Company recorded unrealized loss in investment income of $ 1.0 million and $ 4.6 million, respectively.

During the three months ended June 30, 2024 and June 30, 2023, the Company recorded unrealized (gain) loss in investment income of $( 0.7 ) million and $ 5.5 million, respectively.

During the six months ended June 30, 2024 and June 30, 2023, the Company recorded unrealized loss in investment income of $ 0.3 million and $ 10.1 million, respectively.

See Note 9 — Fair Value Measurements for fair value information and the asset value for investments in Hycroft measured under the fair value option as well as the total asset value for other equity method investments.

2 unchanged sentences

(In millions)

March 31, 2024

June 30, 2024

December 31, 2023

First Lien Secured Debt:

Senior Secured Credit Facility-Term Loan due 2026 ( 8.435 % as of March 31, 2024 and 8.474 % as of December 31, 2023)

Senior Secured Credit Facility-Term Loan due 2026 ( 8.444 % as of June 30, 2024 and 8.474 % as of December 31, 2023)

12.75 % Odeon Senior Secured Notes due 2027

3 unchanged sentences

Subordinated Debt:

6.375 % Senior Subordinated Notes due 2024 (£ 4.0 million par value as of March 31, 2024)

6.375 % Senior Subordinated Notes due 2024 (£ 4.0 million par value as of June 30, 2024)

5.75 % Senior Subordinated Notes due 2025

14 unchanged sentences

12.75 % Odeon Senior Secured Notes due 2027

The following table provides the principal payments required and maturities of corporate borrowing as of March 31, 2024:

The following table provides the principal payments required and maturities of corporate borrowing as of June 30, 2024:

(In millions)

Nine months ended December 31, 2024

Six months ended December 31, 2024

Debt Repurchases and Exchanges

During the three months ended March 31, 2024, the Company executed a debt for equity exchange transaction.

This transaction was treated as an early extinguishment of debt.

The below table summarizes the various debt for equity exchange transactions that occurred during the six months ended June 30, 2024.

The transactions were treated as early extinguishments of debt.

In accordance with ASC 470-50-40-3, the reacquisition price of the extinguished debt was determined to be the fair value of the Common Stock exchanged.

The below table summarizes the debt for equity exchange.

Aggregate Principal

3 unchanged sentences

Second Lien Notes due 2026

The below table summarizes the cash debt repurchase transactions during the three months ended March 31, 2023, including related party transactions with Antara:

The below table summarizes the cash debt repurchase transactions during the six months ended June 30, 2023, including repurchases with a related party:

Aggregate Principal

12 unchanged sentences

See Note 7—Stockholders’ Deficit for discussion of the $ 100.0 million aggregate principal amount of Second Lien Notes due 2026 repurchased from Antara in exchange for 9,102,619 AMC Preferred Equity Units not included in the table above.

See Note 13—Subsequent Events for discussion of debt refinancing transactions that occurred after the balance sheet date.

Financial Covenants

As of March 31, 2024, the Company was subject to a minimum liquidity requirement of $ 100.0 million as a condition to the financial covenant suspension period under the Credit Agreement.

8 unchanged sentences

Accordingly, all references made to share, per share, unit, per unit, or common share amounts in the accompanying consolidated financial statements and applicable disclosures have been retroactively adjusted to reflect the effect of the reverse stock split.

References made to AMC Preferred Equity Units have been retroactively adjusted to reflect the effect of the reverse stock split on their equivalent Common Stock shares.

Accordingly, all references made to share, per share, unit, per unit, or common share amounts in the accompanying consolidated financial statements and applicable disclosures for periods prior to August 24, 2023, have been retroactively adjusted to reflect the effect of the reverse stock split.

References made to AMC Preferred Equity Units have also been retroactively adjusted to reflect the effect of the reverse stock split on their equivalent Common Stock shares.

On August 25, 2023, all of the Company’s outstanding AMC Preferred Equity Units converted into shares of Common Stock.

Share Issuances

During the three months ended March 31, 2023, the Company raised gross proceeds of approximately $ 80.3 million and paid fees to a sales agent and incurred other third-party issuance costs of approximately $ 2.0 million and $ 7.8 million, respectively, through its at-the-market offering of approximately 4.9 million shares of its AMC Preferred Equity Units.

The Company paid $ 6.8 million of other third-party issuance costs during the three months ended March 31, 2023.

The Company paid $ 0.7 million of other third-party issuance costs during the six months ended June 30, 2024.

During the six months ended June 30, 2023, the Company raised gross proceeds of approximately $ 114.5 million and paid fees to a sales agent and incurred other third-party issuance costs of approximately $ 2.9 million and $ 8.3 million, respectively, through its at-the-market offering of approximately 7.1 million shares of AMC Preferred Equity Units.

The Company paid $ 11.0 million of other third-party issuance costs during the six months ended June 30, 2023.

Antara Transactions

7 unchanged sentences

On August 25, 2023, all outstanding AMC Preferred Equity Units were converted to Common Stock.

As of March 31, 2024, the Company has 50,000,000 authorized shares of preferred stock available for issuance.

As of June 30, 2024, the Company has 50,000,000 authorized shares of preferred stock available for issuance.

Stock-Based Compensation

1 unchanged sentence

Three Months Ended

Six Months Ended

(In millions)

1 unchanged sentence

Special awards expense

Board of director stock award expense

Board of directors stock award expense

Restricted stock unit expense

5 unchanged sentences

Total stock-based compensation expense

As of March 31, 2024, the estimated remaining unrecognized compensation cost related to stock-based compensation grants was approximately $ 10.9 million, which reflects assumptions related to attainment of performance targets based on the scales as described below.

As of June 30, 2024, the estimated remaining unrecognized compensation cost related to stock-based compensation grants was approximately $ 23.4 million, which reflects assumptions related to attainment of performance targets based on the scales as described below.

The weighted average period over which this remaining compensation expense is expected to be recognized is approximately 1.2 years.

2 unchanged sentences

This was accounted for as a modification to the 2023 Tranche Year PSU awards which lowered the Adjusted EBITDA and free cash flow performance targets such that 200 % vesting was achieved for both targets.

This modification resulted in the immediate additional vesting of 478,055 2023 Trance Year PSUs ( 21,829 cash settled units and 456,226 equity settled units).

This modification resulted in the immediate additional vesting of 478,055 2023 Tranche Year PSUs ( 21,829 cash settled units and 456,226 equity settled units).

This was treated as a Type 3 modification (improbable-to-probable) which required the Company to recognize additional stock compensation expense based on the modification date fair values of the incremental PSUs.

During the three months ended March 31, 2024, the Company recognized $ 2.1 million of stock compensation expense related to these awards.

During the six months ended June 30, 2024, the Company recognized $ 2.1 million of stock compensation expense related to these awards.

On February 23, 2023, the Compensation Committee approved special awards in lieu of vesting of the 2022 Tranche Year PSU awards.

2 unchanged sentences

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 Units PSUs of $ 14.9 million and $ 5.3 million, respectively.

During the three months ended March 31, 2023, the Company recognized $ 20.2 million of stock compensation expense related to these awards.

During the six months ended June 30, 2023, the Company recognized $ 20.2 million of stock compensation expense related to these awards.

Awards Granted in 2024

On June 5, 2024, the Company’s shareholders approved a new equity incentive plan (“2024 EIP”).

The 2024 EIP has 25.0 million shares of Common Stock available for awards under the plan.

Awards that may be granted under the 2024 EIP include options, stock appreciation rights, restricted stock awards, restricted stock units, cash awards, and other equity-based awards.

The 2024 EIP will be unlimited in duration and, in the event of termination, will remain in effect as long as any shares of awards under it are outstanding and not fully vested.

On June 5, 2024, the Company’s board of directors granted awards of stock, restricted stock units (“RSUs”) and performance stock units (“PSUs”) to certain of the Company’s employees and directors under the 2024 EIP.

Each RSU or PSU is convertible into one share of Common Stock upon vesting.

Each RSU and PSU held by a participant as of a dividend record date is entitled to a dividend equivalent equal to the amount paid with respect to one share of Common

Stock underlying the unit.

Any such accrued dividend equivalents are paid to the holder only upon vesting of the units.

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

The awards generally had the following features:

● Board of Directors Stock Awards:

The Company granted 195,924 fully vested shares of Common Stock to the independent members of the Company’s board of directors with a grant date fair value of $ 1.0 million.

● Restricted Stock Unit Awards:

The Company granted 2,307,931 RSUs to certain members of management with a grant date fair value of $ 11.9 million.

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

The RSUs vest over three years , with one-third vesting each year.

These RSUs will be settled within 30 days of vesting.

● Performance Stock Unit Awards:

In 2023 and 2022 the Compensation Committee awarded PSUs to certain members of management and executive officers, with the PSUs divided into three separate year tranches, with each tranche allocated to a fiscal year with the performance period (“Tranche Year”).

A total of 2,307,931 PSUs were awarded (“2024 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 the free cash flow performance target.

The PSUs will vest if 80 % to 120 % of the performance targets are attained, with the corresponding vested unit amount ranging from 50 % to 200 % of the PSUs awarded.

The 2024 PSU awards will vest if 80 % to 120 % of the performance targets are attained, with the corresponding vested unit amount ranging from 50 % to 200 % of the PSUs awarded.

If the performance targets are met at 100 % , the 2024 PSU awards will vest at 2,307,931 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 or free cash flow targets.

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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 equity classified 2023 PSU award grant date fair value for the 2024 Tranche Year award of 105,357 units was $ 0.5 million and the equity classified 2022 PSU award grant date fair value for the 2024 Tranche Year award of 44,081 units was $ 0.2 million, measured using performance targets at 100 %.

The equity classified 2024 PSU award grant date fair value for the 2024 Tranche Year award of 769,260 units was $ 4.0 million, the equity classified 2023 PSU award grant date fair value for the 2024 Tranche Year award of 105,357 units was $ 0.5 million and the equity classified 2022 PSU award grant date fair value for the 2024 Tranche Year award of 44,081 units was $ 0.2 million, measured using performance targets at 100 %.

Liability Classified Awards

Certain PSUs are expected to be settled in cash and accordingly have been classified as liabilities within accrued expenses and other liabilities in the condensed consolidated balance sheets.

The liability classified 2023 and 2022 PSU awards for the 2024 Tranche Year were also granted when the annual performance targets were set.

The liability classified 2023 PSU awards for the 2024 Tranche Year were granted when the annual performance targets were set.

The vesting requirements and vesting periods are identical to the equity classified awards described above.

The Company recognizes expenses related to these awards based on the fair value of the Common Stock shares, giving effect to the portion of services rendered during the requisite services period.

As of March 31, 2024, there were 58,101 nonvested underlying Common Stock RSUs and PSUs related to awards classified as liabilities.

The Company recognizes expense related to these awards based on the fair value of the Common Stock shares, giving effect to the portion of services rendered during the requisite services period.

As of June 30, 2024, there were 58,101 nonvested underlying Common Stock RSUs and PSUs related to awards classified as liabilities.

There are 43,524 nonvested underlying Common Stock RSUs and PSUs (2024 Tranche Year) that are currently classified as liabilities and 14,577 nonvested underlying Common Stock PSUs (2025 Tranche Year) which have not been granted for accounting purposes as the performance targets for the 2025 PSU Tranche Years have yet to be established.

The following table represents the equity classified nonvested RSU and PSU activity for the three months ended March 31, 2024:

The following table represents the equity classified nonvested RSU and PSU activity for the six months ended June 30, 2024:

RSUs and PSUs (3)

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Cancelled - Special Award (2)

Nonvested at March 31, 2024

Nonvested at June 30, 2024

Tranche Year 2025 awarded under the 2023 PSU award with grant date fair values to be determined in year 2025

Total Nonvested at March 31, 2024

Total Nonvested at June 30, 2024

(1) The number of PSU shares granted under the Tranche Year 2024 assumes the Company will attain a performance target at 100 % for the Adjusted EBITDA target and 100 % for the free cash flow target.

(2) Represents vested RSUs and PSUs surrendered in lieu of taxes.

As a result, the Company paid taxes for restricted unit withholdings of approximately $ 2.2 million during the three months ended March 31, 2024.

As a result, the Company paid taxes for restricted unit withholdings of approximately $ 2.2 million during the six months ended June 30, 2024.

(3) Includes AMC Preferred Equity Unit RSUs and PSUs that were converted to Common Stock RSUs and PSUs.

Condensed Consolidated Statements of Stockholders’ Deficit

For the Three Months Ended March 31, 2024

Class A Voting

For the Six Months Ended June 30, 2024

Comprehensive

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Balances March 31, 2024

Other comprehensive income

Debt for equity exchange

Share issuance

Stock-based compensation

Balances June 30, 2024

(1) Vested Common Stock RSUs and PSUs.

Condensed Consolidated Statements of Stockholders’ Deficit

For the Three Months Ended March 31, 2023

For the Six Months Ended June 30, 2023

Preferred Stock

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Balances March 31, 2023

Other comprehensive loss

AMC Preferred Equity Units issuance

Taxes paid for restricted unit withholdings

Stock-based compensation

Balances June 30, 2023

(1) Includes 8,555 Common Stock shares and 15,370 AMC Preferred Equity Units awarded to the Board of Directors, 226,791 vested Common Stock RSUs and PSUs, and 254,074 vested AMC Preferred Equity Units RSUs and PSUs.

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The Company’s worldwide effective income tax rate is based on actual income (loss), statutory rates, valuation allowances against deferred tax assets and tax planning opportunities available in the various jurisdictions in which it operates.

The Company is using a discrete income tax calculation for the three months ended March 31, 2024, due to the lingering effects of the COVID-19 pandemic and recent labor stoppages on the industry.

The Company is using a discrete income tax calculation for the six months ended June 30, 2024, due to the lingering effects of the COVID-19 pandemic and recent labor stoppages on the industry.

Historically, for interim financial reporting, the Company estimated the worldwide annual income tax rate based on projected taxable income (loss) for the full year and recorded a quarterly income tax provision or benefit in accordance with the anticipated annual rate, adjusted for discrete items, if any.

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deferred tax assets and most of the Company’s international deferred tax assets as the Company has determined the realization of these assets does not meet the more likely than not criteria.

The effective tax rate for the three months ended March 31, 2024, reflects the impact of these valuation allowances against U.S.

The effective tax rate for the six months ended June 30, 2024, reflects the impact of these valuation allowances against U.S.

and international deferred tax assets generated during the period.

The actual effective rate for the three months ended March 31, 2024, was ( 1.1 )%.

The Company’s consolidated tax rate for the three months ended March 31, 2024, differs from the U.S.

The actual effective rate for the six months ended June 30, 2024, was ( 1.3 )%.

The Company’s consolidated tax rate for the six months ended June 30, 2024, differs from the U.S.

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

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Recurring Fair Value Measurements.

The following table summarizes the fair value hierarchy of the Company’s financial assets carried at fair value on a recurring basis as of March 31, 2024:

Fair Value Measurements at March 31, 2024 Using

The following table summarizes the fair value hierarchy of the Company’s financial assets carried at fair value on a recurring basis as of June 30, 2024:

Fair Value Measurements at June 30, 2024 Using

Total Carrying

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(In millions)

March 31, 2024

June 30, 2024

Other long-term assets:

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The Company is required to disclose the fair value of financial instruments that are not recognized at fair value in the statement of financial position for which it is practicable to estimate that value:

Fair Value Measurements at March 31, 2024 Using

Fair Value Measurements at June 30, 2024 Using

Significant other

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(In millions)

March 31, 2024

June 30, 2024

Current maturities of corporate borrowings

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Three Months Ended

Six Months Ended

Revenues (In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

International markets

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Three Months Ended

Six Months Ended

Adjusted EBITDA (In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

International markets

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Three Months Ended

Six Months Ended

Capital Expenditures (In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

International markets

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Long-term assets, net (In millions)

March 31, 2024

June 30, 2024

December 31, 2023

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Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Net earnings (loss)

Income tax provision (1)

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Attributable EBITDA (4)

Investment income (5)

Investment expense (income) (5)

Other expense (income) (6)

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Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Equity in (earnings) of non-consolidated entities

Equity in (earnings) of non-consolidated entities excluding International theatre joint ventures

Equity in earnings of International theatre joint ventures

Equity in (loss) of International theatre joint ventures

Income tax benefit

Investment expense

Interest expense

Depreciation and amortization

Attributable EBITDA

(5) Investment expense (income) during the three months ended March 31, 2024, primarily includes deterioration in estimated fair value of the Company’s investment in common shares of Hycroft of $ 0.5 million, deterioration in estimated fair value of the Company’s investment in warrants to purchase common shares of Hycroft of $ 0.5 million and interest income of $( 6.1 ) million.

Investment expense (income) during the three months ended March 31, 2023 included deterioration in estimated fair value of the Company’s investment in common shares of Hycroft of $ 2.3 million, deterioration in estimated fair value of the Company's investment in warrants to purchase common shares of Hycroft of $ 2.3 million, and a $( 15.5 ) million gain on the sale of the Company’s investment in Saudi Cinema Company, LLC, and interest income of $( 2.3 ) million.

(6) Other expense (income) during the three months ended March 31, 2024, includes a vendor dispute settlement of $( 36.2 ) million, foreign currency transaction losses of $ 3.2 million and gains on debt extinguishment of $( 5.8 ) million.

Other expense (income) during the three months ended March 31, 2023, included a non-cash litigation contingency charge of $ 116.6 million, partially offset by foreign currency transaction gains of $( 8.7 ) million and gains on debt extinguishment of $( 65.1 ) million.

(5) Investment expense (income) during the three months ended June 30, 2024 includes appreciation in the estimated fair value of the Company’s investment in common shares of Hycroft of $( 0.4 ) million, appreciation in estimated fair value of the Company’s investment in warrants to purchase common shares of Hycroft of $( 0.3 ) million and interest income of $( 5.4 ) million.

Investment expense (income) during the three months ended June 30, 2023 included deterioration in estimated fair value of the Company’s investment in common shares of Hycroft of $ 3.2 million, deterioration in estimated fair value of the Company's investment in warrants to purchase common shares of Hycroft of $ 2.3 million, and interest income of $( 2.5 ) million.

Investment expense (income) during the six months ended June 30, 2024 includes deterioration in estimated fair value of the Company’s investment in common shares of Hycroft of $ 0.1 million, deterioration in estimated fair value of the Company’s investment in warrants to purchase common shares of Hycroft of $ 0.2 million, and interest income of $( 11.5 ) million.

Investment expense (income) during the six months ended June 30, 2023 included deterioration in estimated fair value of the Company’s investment in common shares of Hycroft of $ 5.5 million, deterioration in estimated fair value of the Company’s investment in warrants to purchase common shares of Hycroft of $ 4.6 million, $( 15.5 ) million gain on the sale of the Company’s investment in Saudi Cinema Company, LLC and interest income of $( 4.8 ) million.

(6) Other expense (income) during the three months ended June 30, 2024 includes shareholder litigation recoveries of $ ( 19.1 ) million, foreign currency transaction gains of $( 0.6 ) million and gains on debt extinguishment of $( 85.3 ) million.

Other expense (income) during the three months ended June 30, 2023 included a non-cash litigation contingency adjustment of $( 1.2 ) million, foreign currency transaction gains of $( 7.5 ) million, and gains on debt extinguishment of $( 21.6 ) million.

Other expense (income) during the six months ended June 30, 2024 includes shareholder litigation recoveries of $( 19.1 ) million, gains on debt extinguishment of $( 91.1 ) million, a vendor dispute settlement of $( 36.2 ) million, and foreign currency transaction losses of $ 2.6 million.

Other expense (income) during the six months ended June 30, 2023 included a non-cash litigation contingency charge of $ 115.4 million, partially offset by gains on debt extinguishment of $( 86.7 ) million and foreign currency transaction gains of $( 16.2 ) million.

(7) Reflects amortization expense for 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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On January 6, 2023, the remainder of the Settlement Amount of $ 14.0 million was paid to the Company.

The Company recorded the settlement as a gain in other income during the three months ended March 31, 2023.

The Company recorded the settlement as a gain in other income during the six months ended June 30, 2023.

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

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2023-0216-MTZ (Del.

Ch.) (the “Munoz Action”) and which have been subsequently consolidated into In re AMC Entertainment Holdings, Inc.

Ch.) (the “Munoz Action”) and which were subsequently consolidated into In re AMC Entertainment Holdings, Inc.

Stockholder Litigation C.A.

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

§ 242 against those directors and the Company, arising out of the Company’s creation of the APEs, the Antara Transactions, and the Charter Amendments.

The Munoz Action, which was filed by the stockholders who had previously made demands to inspect certain of the Company’s books and records pursuant to 8 Del.

§ 242 against those directors and the Company, arising out of the Company’s creation of the AMC Preferred Equity Units, the Antara Transactions, and the Charter Amendments.

The Munoz Action, which was filed by stockholders who had previously made demands to inspect certain of the Company’s books and records pursuant to 8 Del.

§ 220, asserted 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 sought 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 Amendments or that the APEs be enjoined from voting on the Charter Amendments, and an award of money damages.

The Munoz Action sought to enjoin the APEs from voting on the Charter Amendments.

The Allegheny Action sought a declaration that the issuance of the AMC Preferred Equity Units 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 AMC Preferred Equity Units on the Charter Amendments or that the AMC Preferred Equity Units be enjoined from voting on the Charter Amendments, and an award of money damages.

The Munoz Action sought to enjoin the AMC Preferred Equity Units from voting on the Charter Amendments.

On February 27, 2023, the Delaware Court of Chancery entered a status quo order that allowed the March 14, 2023 vote on the Charter Amendments to proceed, but precluded the Company from implementing the Charter Amendments pending a ruling by the court on the plaintiffs’ then-anticipated preliminary injunction motion (the “Status Quo Order”).

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Pursuant to the term sheet, the Company agreed, following and subject to AMC’s completion of the Conversion and Reverse Stock Split, to make a non-cash settlement payment to record holders of Common Stock immediately prior to the Conversion (and after giving effect to the Reverse Stock Split) of one share of Common Stock for every 7.5 shares of Common Stock owned by such record holders.

The Company’s obligation to make the Settlement Payment was

contingent on the Status Quo Order being lifted and the Company effecting the Charter Amendments.

The Company’s obligation to make the Settlement Payment was contingent on the Status Quo Order being lifted and the Company effecting the Charter Amendments.

The defendants agreed to the settlement and the payment of the Settlement Payment 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 Shareholder Litigation.

On April 3, 2023, the plaintiffs filed an unopposed motion to lift the Status Quo Order, but on April 5, 2023, the court denied the motion to lift the Status Quo Order.

On April 3, 2023, the plaintiffs filed an unopposed motion to lift the Status Quo Order.

On April 5, 2023, the court denied the motion to lift the Status Quo Order.

On April 27, 2023, the parties jointly filed a Stipulation and Agreement of Compromise, Settlement, and Release (the “Settlement Stipulation”) with the court, which fully memorialized the settlement that the parties agreed to in the term sheet.

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On August 14, 2023, the Company filed the amendment to its Third Amended and Restated Certificate of Incorporation, effective as of August 24, 2023, which was previously approved by the Company’s stockholders at the special meeting held on March 14, 2023 to implement the Charter Amendments.

The Reverse Stock Split occurred on August 24, 2023, the conversion of APEs into Common Stock occurred on August 25, 2023, and the Settlement Payment was made on August 28, 2023.

The Reverse Stock Split occurred on August 24, 2023, the conversion of AMC Preferred Equity Units into Common Stock occurred on August 25, 2023, and the Settlement Payment was made on August 28, 2023.

On September 15, 2023, the Court entered an order dismissing the Shareholder Litigation in its entirety and with prejudice.

On October 13, 2023, a purported Company stockholder who objected to the settlement of the Shareholder Litigation filed a notice of appeal of the Court’s order approving the settlement.

As of January 26, 2024, the appeal was fully briefed before the Delaware Supreme Court and oral arguments on the appeal will be held on May 8, 2024.

In connection with the Shareholder Litigation, the Company recorded a $ 126.6 million charge to other expense during the three months ended March 31, 2023.

The charge was based on an estimated fair value for the Settlement Payment of $ 116.6 million and estimated legal fees, net of probable insurance recoveries of $ 10.0 million as of March 31, 2023.

On October 13, 2023, a purported Company stockholder who objected to the settlement of the Shareholder Litigation filed a notice of appeal of the Court’s decision approving the settlement.

On May 22, 2024, the Delaware Supreme Court affirmed the Court’s decision approving the settlement of the Shareholder Litigation.

In connection with the Shareholder Litigation, the Company recorded a $ 125.4 million charge to other expense during the six months ended June 30, 2023.

The charge was based on an estimated fair value for the Settlement Payment of $ 115.4 million and estimated legal fees, net of probable insurance recoveries of $ 10.0 million as of June 30, 2023.

The Company made the Settlement Payment on August 28, 2023, and recorded the disbursement to stockholders’ deficit.

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2023-0835-MTZ (the “Simons Action”), was filed against the Company in the Delaware Court of Chancery.

The Simons Action asserts claims for a declaratory judgment, injunctive relief, and breach of contract, and alleges that the Settlement Payment in the Shareholder Litigation violates the Certificate of Designations that governed the APEs prior to the conversion of the APEs into Common Stock.

The Simons Action asserts claims for a declaratory judgment, injunctive relief, and breach of contract, and alleges that the Settlement Payment in the Shareholder Litigation violates the Certificate of Designations that governed the AMC Preferred Equity Units prior to the conversion of the AMC Preferred Equity Units into Common Stock.

On September 12, 2023, the Company filed a motion to dismiss the complaint.

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The primary insurer in the Coverage Action has paid its full $ 5 million limit.

The Company has reached confidential settlement agreements with multiple insurers in the Coverage Action.

The remainder of the insurers contest whether they owe coverage for the Settlement Payment, claiming it does not constitute a “Loss” under their insurance policies.

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District Court for the District of Massachusetts.

The Mathew Action names the Company as a nominal defendant.

The Mathew Action named the Company as a nominal defendant.

On November 16, 2023, plaintiffs filed an amended complaint.

January 9, 2024, the Company filed a motion to dismiss the amended complaint.

On January 9, 2024, the Company filed a motion to dismiss the amended complaint.

On January 11, 2024, plaintiffs filed a motion for leave to file a second amended complaint.

On January 24, 2024, the Company filed an opposition to plaintiff’s motion for leave to file a second amended complaint.

On June 17, 2024, the court granted the Company’s motion to dismiss and denied plaintiffs’ motion for leave to file a second amended complaint.

On December 18, 2023, an action captioned Miller, et al.

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On April 17, 2024, the parties filed a stipulation dismissing the Miller Action with prejudice.

NOTE 12—LOSS PER SHARE

On May 2, 2024, the United States District Court for the Southern District of New York issued an order granting final approval of a proposed settlement reached by all parties to an action brought by plaintiffs Dennis J.

Donoghue and Mark Rubenstein, each of whom are shareholders of the Company, for the Company to recover “short-swing” profits under Section 16(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) alleged to have been realized by defendants Antara Capital Master Fund LP, Antara Capital Fund GP LLC, Antara Capital LP, Antara Capital GP LLC, and Himanshu Gulati (collectively, the “Antara Defendants”) in connection with their purchases and sales of the Company’s securities.

The Company is party to the suit in name only, which was brought for the benefit of the Company.

The Company received $ 2.6 million in connection with this action during the three and six months ended June 30, 2024.

NOTE 12—EARNINGS (LOSS) PER SHARE

On August 24, 2023, the Company effectuated a reverse stock split at a ratio of one share of Common Stock for every ten shares of Common Stock.

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References made to AMC Preferred Equity Units have been retroactively adjusted to reflect the effect of the reverse stock split on their equivalent Common Stock shares.

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 PSUs that have service and performance conditions, if dilutive.

The following table sets forth the computation of basic and diluted loss per common share:

Accordingly, all references made to share, per share, unit, per unit, or common share amounts in the accompanying condensed consolidated financial statements and applicable disclosures for periods prior to August 24, 2023, have been retroactively adjusted to reflect the reverse stock split.

References made to AMC Preferred Equity Units have also been retroactively adjusted to reflect the effect of the reverse stock split on their equivalent Common Stock shares.

Basic earnings (loss) per share is computed by dividing net earnings (loss) by the weighted-average number of common shares outstanding.

Diluted earnings (loss) per share includes the effects of unvested RSUs with a service condition only and unvested contingently issuable PSUs that have service and performance conditions, if dilutive.

The following table sets forth the computation of basic and diluted earnings (loss) per common share:

Three Months Ended

Six Months Ended

(In millions)

March 31, 2024

March 31, 2023

Net loss for basic and diluted loss per share

June 30, 2024

June 30, 2023

June 30, 2024

June 30, 2023

Net earnings (loss) for basic and diluted earnings (loss) per share

Denominator (shares in thousands):

Weighted average shares for basic loss per common share

Basic and diluted loss per common share

Vested RSUs and PSUs 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.

Unvested RSUs of 271,738 for the three months ended March 31, 2024 were not included in the computation of diluted loss per share because they would be anti-dilutive.

Unvested RSUs of 531,957 for the three months ended March 31, 2023 were not included in the computation of diluted loss per share because they would be anti-dilutive.

Unvested PSUs are subject to performance conditions and are included in diluted earnings per share, if dilutive, based on the number of shares, if any, that would be issuable under the terms of the award agreements if the end of the reporting period were the end of the contingency period.

Unvested PSUs of 149,080 for the three months ended March 31, 2024 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.

Unvested PSUs of 297,829 at certain performance targets for the three months ended March 31, 2023 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.

Common equivalent shares for RSUs and PSUs

Weighted average shares for diluted earnings (loss) per common share

Basic earnings (loss) per common share

Diluted earnings (loss) per common share

Vested RSUs and PSUs have dividend rights identical to the Company’s Common Stock and are treated as outstanding shares for purposes of computing basic and diluted earnings (loss) per share.

Unvested RSUs of 2,579,669 for each of the three and six months ended June 30, 2024 were not included in the computation of diluted earnings (loss) per share because they would be anti-dilutive.

Unvested RSUs of 491,439 and 531,957 for the three and six months ended June 30, 2023, respectively, were not included in the computation of diluted earnings (loss) per share because they would be anti-dilutive.

Unvested PSUs are subject to performance conditions and are included in diluted earnings (loss) per share, if dilutive, based on the number of shares, if any, that would be issuable under the terms of the award agreements if the end of the reporting period were the end of the contingency period.

Unvested PSUs of 918,340 for each of the three and six months ended June 30, 2024 were not included in the computation of diluted earnings (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.

Unvested PSUs of 292,904 and 297,823 at certain performance targets for the three and six months ended June 30, 2023, respectively, 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.

NOTE 13 —SUBSEQUENT EVENTS

Share Issuance.

Through the date of this filing, the Company has received gross proceeds of approximately $ 103.5 million through its at-the-market offering of approximately 32.0 million shares of its Common Stock and paid fees to the sales agents of approximately $ 2.6 million.

Termination of Senior Secured Revolving Credit Facility .

As of April 19, 2024, and in anticipation of the maturity of the Senior Secured Revolving Credit Facility, the Company has voluntarily terminated the commitments under the Senior Secured Revolving Credit Facility in full and paid off any remaining obligations with respect to the Senior Secured Revolving Credit Facility (the “Revolver Payoff”).

Immediately from and after the Revolver Payoff, the financial covenant that required, in certain circumstances, compliance with a certain secured leverage ratio and the related covenant suspension conditions are no longer in effect pursuant to the terms of the Credit Agreement.

The termination of the Senior Secured Revolving Credit Facility does not otherwise affect the senior secured term loan facility under the Credit Agreement.

Debt Refinancing.

On July 22, 2024 (the “Closing Date”), the Company completed a series of refinancing transactions with two creditor groups to refinance and extend to 2029 and 2030 the maturities of approximately $ 1.6 billion of the Company’s debt previously maturing in 2026 (collectively, the “Debt Refinancing”).

These arrangements provide for the potential additional refinancing of up to approximately $ 800 million of debt maturing in 2026 or earlier.

In connection with the Debt Refinancing:

● The Company and Muvico, LLC, a newly formed indirect wholly-owned subsidiary of the Company (“Muvico”), entered into that certain Credit Agreement (the “New Term Loan Credit Agreement”), by and among the Company and Muvico, each, as a borrower (collectively, the “New Term Loan Borrowers”), the lenders party thereto and Wilmington Savings Fund Society, FSB, as administrative agent and collateral agent pursuant to which the Company and Muvico jointly and severally borrowed $ 1.2 billion of new term loans maturing in 2029 (the “New Term Loans”).

● The New Term Loans were (i) used as consideration for the open market purchase of $ 1.1 billion of the Company’s existing senior secured term loans maturing in 2026 (the “Existing Term Loans”) and (ii) exchanged for $ 104.2 million of the Company’s 10 % / 12 % Cash/PIK Toggle Second Lien Subordinated Secured Notes due 2026 (the “Second Lien Notes”).

Under the terms of the New Term Loan Credit Agreement, lenders of the remaining Existing Term Loans will be entitled to exchange their remaining Existing Term Loans for the New Term Loans subject to certain terms and conditions.

● Muvico also completed a private offering for cash of $ 414.4 million aggregate principal amount of 6.00 % / 8.00 % Cash/PIK Toggle Senior Secured Exchangeable Notes due 2030 (the “Exchangeable

Notes”), which are guaranteed by the Company, the existing guarantors under the Existing Term Loans, and the Existing First Lien Notes (as defined herein) (the “Existing Guarantors”) and Centertainment (as defined below) and which are exchangeable into the Company’s Common Stock on the terms described herein.

● Muvico used the proceeds from the offering of the Exchangeable Notes to repurchase $ 414.4 million aggregate principal amount of the Second Lien Notes.

Muvico is entitled to issue up to an additional $ 50.0 million of the Exchangeable Notes (the “Additional Exchangeable Notes”), the proceeds of which must be used to repurchase other outstanding debt due in 2025, 2026, and 2027.

In connection with the formation of Muvico, among other things, the Company and certain of its subsidiaries (collectively, “AMC”) transferred certain leases, owned real property and related assets and rights in respect of 175 theatres to Muvico, along with certain intellectual property, including the AMC brand name, pursuant to an asset transfer agreement.

In connection with the foregoing, the Company and Muvico (i) entered into a management services agreement, pursuant to which Muvico engaged AMC to manage and operate the transferred theatres and (ii) Muvico granted AMC a license to use the transferred intellectual property.

Muvico is a direct subsidiary of Centertainment Development, LLC (“Centertainment”).

Each of Muvico and Centertainment is an “unrestricted subsidiary” under the Existing Term Loans and the Existing First Lien Notes and therefore not subject to various restrictive covenants under the covenants governing such indebtedness.

On August 1, 2024, the Company completed follow-on open market repurchases of the Company’s Existing Term Loans, and in exchange, issued to such selling holders the Company’s New Term Loans pursuant to the New Term Loan Credit Agreement, by and among the Company and Muvico, LLC as co-borrowers, the lenders party thereto and Wilmington Savings Fund Society, FSB, as administrative agent and collateral agent.

As of August 1, 2024, the Company completed open market purchase of $ 1,864.0 million aggregate principal amount of its Existing Term Loans and issued $ 1,993.3 million aggregate principal amount of the New Term Loans.

Accordingly, as of such date, the Company had approximately $ 31.0 million aggregate principal amount of Existing Term Loans outstanding.

No Additional Exchangeable Notes have been issued as of the date of this filing.

The following sections provide summaries of the key terms and provisions of the Existing Credit Agreement Amendment (as defined herein), the New Term Loans, and the Exchangeable Notes.

Existing Credit Agreement Amendment

On the Closing Date, the Company entered into that certain Fourteenth Amendment to Credit Agreement (the “Existing Credit Agreement Amendment”), by and among the Company, the Existing Guarantors, the lenders party thereto (which constituted the “Required Lenders” as defined in the Existing Credit Agreement referred to below, the “Specified Existing Lenders”) and Wilmington Savings Fund Society, FSB, as administrative agent and as collateral agent, which amends the credit agreement governing the Existing Term Loans (as amended through the Thirteenth Amendment to Credit Agreement, dated as of June 23, 2023, the “Existing Credit Agreement”).

Pursuant to the Existing Credit Agreement Amendment, certain provisions of the Existing Credit Agreement, including certain affirmative covenants, negative covenants and events of default were removed with the consent of the Specified Existing Lenders.

In addition, the Specified Existing Lenders consented to all of the transactions described herein and consented to, and directed Wilmington Savings Fund Society, FSB, as collateral agent in respect of the Existing Term Loans, to enter into the Credit Facilities Intercreditor Agreement (as defined below).

New Term Loan Credit Agreement

Amortization, Interest, Guarantees and Security

The New Term Loan Credit Agreement provides for (i) the New Term Loans in an initial aggregate principal amount of $ 1,229,415,340 and (ii) the ability of the New Term Loan Borrowers to incur additional New Term Loans, the proceeds of which will be used in connection with future open market purchases of the Existing Term Loans.

The New Term Loans mature on January 4, 2029 (or, if at least $ 190,000,000 of the Existing First Lien Notes have not been repurchased (and cancelled), repaid or refinanced by October 5, 2028, then October 5, 2028).

The New Term Loans are subject to amortization of principal, payable in quarterly installments on the last business day of each

fiscal quarter, commencing on September 30, 2024, equal to 1.00 % per annum.

The remaining aggregate principal amount outstanding (together with accrued and unpaid interest on the principal amount) of the New Term Loans is payable at maturity.

The New Term Loans bear interest, at the option of the New Term Loan Borrowers, at rates equal to either (i) a base rate plus a margin of between 500 and 600 basis points depending on the total leverage ratio of the Company and its subsidiaries on a consolidated basis (the “Total Leverage Ratio”) or (ii) Term SOFR plus a margin of between 600 and 700 basis points depending on the Total Leverage Ratio.

Until the delivery under the New Term Loan Credit Agreement of the financial statements for the first full fiscal quarter ending after the Closing Date, the New Term Loans bear interest, at the option of the Company, at either (a) the base rate plus a margin of 600 basis points or (b) Term SOFR plus a margin of 700 basis points.

The New Term Loans are guaranteed, subject to limited exceptions, by Centertainment and Muvico and their future respective subsidiaries (collectively, the “Centertainment Group Parties”) and the Existing Guarantors, and are secured by liens on substantially all of the tangible and intangible assets owned by the Company and such guarantors, in each case, subject to limited exceptions set forth in the New Term Loan Credit Agreement.

Covenants and Events of Default

The New Term Loan Credit Agreement contains covenants that limit the Company and its subsidiaries’ ability to, among other things:

(i) incur additional indebtedness or 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 its affiliates;

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

and (vii) maintain cash in the accounts of the Company and its subsidiaries (other than the Centertainment Group Parties).

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

The New Term Loan Credit Agreement also provides for events of default, which, if any of them occurs, would permit or require the principal, premium, if any, interest and any other monetary obligations on all the then outstanding New Term Loans to become immediately due and payable.

Exchangeable Notes Indenture

Interest, Guarantees and Security

The Exchangeable Notes were issued pursuant to an indenture (the “Exchangeable Notes Indenture”) dated as of the Closing Date, by and among Muvico, Centertainment, the Company, the Existing Guarantors and GLAS Trust Company LLC, as trustee and as collateral agent.

The Exchangeable Notes will bear interest at a rate of 6.00 % per annum, if paid in cash, and 8.00 % per annum, if paid in-kind by issuing the Exchangeable Notes (“PIK Notes”) having the same terms and conditions as the Exchangeable Notes in each case, payable semi-annually in arrears on June 15 and December 15, beginning on December 15, 2024.

The Exchangeable Notes will mature on April 30, 2030, unless redeemed or exchanged in full prior to such maturity date, pursuant to the terms contained in the Exchangeable Notes Indenture.

Muvico’s obligations under the Exchangeable Notes are fully and unconditionally guaranteed on a joint and several basis by the Company, Centertainment and its future subsidiaries (subject to certain exceptions), and all of the Company’s existing and future subsidiaries that guarantee the Company’s other indebtedness, including under the New Term Loan Credit Agreement.

The Exchangeable Notes are secured (a) on a second lien priority basis by substantially all of the tangible and intangible assets of the Centertainment Group Parties and (b) on a first lien priority basis (but subject to a limitation on the amount of obligations so secured) by substantially all of the tangible and intangible assets of the Company and the Existing Guarantors, subject to certain turnover obligations relative to the New Term Loans.

Exchange Mechanics;

Fundamental Change;

At any time prior to the close of business on the second Trading Day (as defined in the Exchangeable Notes Indenture) immediately preceding the final maturity date of the Exchangeable Notes, each holder of the Exchangeable Notes shall have the right, at its option, to surrender for exchange all or a portion of its Exchangeable Notes at the Exchange Rate (as defined in the Exchangeable Notes Indenture) for Common Stock of the Company.

The Exchange Rate is initially set at 176.6379 shares of the Common Stock per $1,000 principal amount of the Exchangeable Notes exchanged, which reflects a price of $ 5.66 per share Common Stock (“Exchange Price”), which price is equal to 113 % of the closing price per share of the Common Stock on July 19, 2024.

The Exchange Rate is subject to customary adjustments and anti-dilution protections (as provided in the Exchangeable Notes Indenture).

At any time prior to the close of business on the second Trading Day immediately preceding the final maturity date of the Exchangeable Notes, Muvico will also have the right, at its election, to redeem all (but not less than all) of the outstanding Exchangeable Notes at a price equal to the aggregate principal amount of the Exchangeable Notes, plus accrued and unpaid interest thereon to, but excluding, the date of such redemption if the Daily VWAP (as defined in the Exchangeable Notes Indenture) per share of Common Stock exceeds 140 % of the Exchange Price for fifteen (15) consecutive Trading Days ending on (and including) the Trading Day immediately before the date on which Muvico sends a notice to holders calling such Exchangeable Notes for redemption (a “Soft Call Notice”).

Any such Soft Call Notice will provide that the applicable redemption of the Exchangeable Notes will occur on a business day of Muvico’s choosing, not more than ten (10) and not less than five (5) business days after the date of the Soft Call Notice.

Notwithstanding the foregoing, holders of Exchangeable Notes will be entitled within two (2) business days of such Soft Call Notice to submit their Exchangeable Notes for exchange under the terms of the Exchangeable Notes Indenture.

In the event that holders of Exchangeable Notes voluntarily elect to exchange their Exchangeable Notes, such holders will also be entitled to a make-whole premium (the “Exchange Adjustment Consideration”) equal to (i) prior to the third anniversary of the Issue Date, 18.0 % of the aggregate principal amount of the Exchangeable Notes being exchanged; (ii) on or after the third anniversary and prior to the fourth anniversary of the Issue Date, 12.0 % of the aggregate principal amount of the Exchangeable Notes being exchanged;

and (iii) on or after the fourth anniversary of the Issue Date and prior to the fifth anniversary, 6.0 % of the aggregate principal amount of the Exchangeable Notes being exchanged.

Muvico, at its option, will be entitled to pay the Exchange Adjustment Consideration in the form of shares of Common Stock (using a modified exchange price equal to 140 % of the Exchange Price), subject to restrictions under the New Credit Agreement, cash in twelve (12) equal installments over the twelve-month period following the applicable exchange or a combination thereof.

If certain corporate events that constitute a Fundamental Change (as defined in the Exchangeable Notes Indenture) occur, then holders will have the right to require Muvico to repurchase their Exchangeable Notes at a cash repurchase price equal to 100 % of the aggregate principal amount of the Exchangeable Notes to be repurchased, plus accrued and unpaid interest, if any, thereon to, but excluding, the Fundamental Change Repurchase Date (as defined in the Exchangeable Notes Indenture).

The definition of Fundamental Change includes certain business combination transactions involving the Company, stockholder approval of any plan or proposal for the liquidation or dissolution of the Company and certain de-listing events with respect to the Common Stock.

Muvico will also be required to mandatorily redeem all of the issued and outstanding Exchangeable Notes at a purchase price equal to 100 % of the aggregate principal amount, plus accrued and unpaid interest to, but excluding, the date of purchase in the event that, as of ninety (90) days prior to the maturity date of the Company’s 7.50 % first lien secured notes due 2029 (the “Existing First Lien Notes”), the aggregate principal amount outstanding of the Existing First Lien Notes with a maturity date prior to April 30, 2030 exceeds $ 190,000,000 .

Covenants and Events of Default

The Exchangeable Notes Indenture contains covenants that limit the Centertainment Group Parties’ ability to, among other things:

(i) incur additional indebtedness or 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 its 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 Exchangeable Notes Indenture also incorporates the other restrictive covenants contained in the New Term Loan Credit Agreement.

The Exchangeable Notes Indenture also provides for events of default, which, if any of

them occurs, would permit or require the principal, premium, if any, interest and any other monetary obligations on all the then outstanding Exchangeable Notes to be due and payable immediately.

Additional Exchangeable Notes

The Exchangeable Notes Indenture provides that Muvico may issue an additional $ 50.0 million aggregate principal amount of Additional Exchangeable Notes from time to time to fund purchases of the Company’s remaining outstanding Second Lien Notes, 5.75 % senior subordinated notes due 2025 and the existing term loan facilities under the Existing Credit Agreement.

Until the date that is three (3) months following the Issue Date, only the initial purchasers of the Exchangeable Notes and their designated affiliates have the right to purchase for cash such Additional Exchangeable Notes, and the proceeds may only be used to repurchase outstanding debt securities on terms agreed with such purchasers and/or their designated affiliates.

Any such Additional Exchangeable Notes, if issued, will have the same terms and exchange price as the Exchangeable Notes originally issued under the Exchangeable Notes Indenture.

The Company is evaluating the accounting treatments associated with these refinancing transactions and the analysis of the financial effect is ongoing.

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-Q

Item 1. Financial Statements