What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2022-03-01 compared with 2021-03-12 · 11 added, 110 removed, 30 unchanged (80% of the section changed)

1 unchanged sentence

Market Information

Our common equity consists of Class A and Class B common stock.

Our Class A common stock has traded on the New York Stock Exchange since December 18, 2013 under the symbol “AMC.” There was no established public trading market for our Class B common stock and on February 1, 2021, all outstanding Class B common stock was converted to Class A common stock.

Our common equity consists of Class A common stock.

Holders of Common Stock

On March 3, 2021, there were 1,513 stockholders of record of our Class A common stock.

On February 24, 2022, there were 8,963 stockholders of record of our Class A common stock, who hold their shares directly with our transfer agent.

Dividend Policy

In the first quarter of 2020, we elected to decrease the dividend paid in the first quarter of 2020 by $0.17 per share (or a quarterly rate equal to approximately $0.03 per share) when compared to quarterly cash dividends paid of $0.20 per share for each quarter in 2019 on Holdings’ Class A and Class B common stock.

Since April 24, 2020, we have been prohibited from making dividend payments in accordance with the covenant suspension conditions in our Senior Secured Credit Facility Agreement.

Since April 24, 2020, we have been prohibited from making dividend payments in accordance with the covenant suspension conditions in our Credit Agreement (as defined in Note 8 — Corporate Borrowings and Finance Lease Obligations to the Consolidated Financial Statements included in Part II, Item 8 thereof).

The payment of future dividends after expiration of our covenant suspension conditions (for further information see Notes 8 — Corporate Borrowings and Finance Lease Obligations to the Consolidated Financial Statements included in Part II, Item 8 on this Annual Report on Form 10-K) is subject to our Board of Directors’ discretion and dependent on many considerations, including limitations imposed by covenants in the agreements governing our indebtedness, operating results, capital requirements, strategic considerations and other factors.

We will only be able to pay dividends from our available cash on hand and funds received from our subsidiaries.

Their ability to make any payments to us will depend upon many factors, including our operating results, cash flows and the terms of the Senior Secured Credit Facility and the indentures governing our debt securities.

Their ability to make any payments to us will depend upon many factors, including our operating results, cash flows and the terms of the Senior Secured Credit Facilities and the indentures governing our debt securities.

The declaration and payment of any future dividends will be at the sole discretion of our Board of Directors after taking into account various factors, including legal requirements, our subsidiaries’ ability to make payments to us, our financial condition, operating results, cash flow from operating activities, available cash and current and anticipated cash needs.

4 unchanged sentences

Sale of Unregistered Securities

On July 31, 2020, we issued 5,000,000 shares of Class A common stock in a private placement pursuant to an exemption from registration provided by Section 4(a)(2) of the Securities Act.

The shares of Class A common stock were issued as consideration for the backstop commitment provided by certain holders of our subordinated notes to backstop 100% of the unsubscribed portion of our offering of first lien notes.

On December 14, 2020, we issued an aggregate of 21,978,022 shares of Class A common stock in a private placement to Mudrick Capital Management, LP (“Mudrick”) in reliance on an exemption from registration provided by Section 4(a)(2) of the Securities Act.

The shares of Class A common stock were issued as consideration for (i) the commitment provided by Mudrick with respect to the purchase of $100 million in aggregate principal amount of new 15%/17% Cash/PIK Toggle First Lien Secured Notes due 2026 issued by the Company and (i) the exchange of $104.5 million aggregate principal amount of the Company’s 10%/12% Cash/PIK Toggle Second Lien Subordinated Secured Notes due 2026 held by Mudrick.

On June 1, 2021, we issued 8,500,000 shares of Common Stock to Mudrick Capital Management, LP, for $230.5 million in a private placement pursuant to 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.

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

Issuer Purchase of Equity Securities

2 unchanged sentences

The following stock performance graph compares, for the period December 31, 2016 through December 31, 2021, the cumulative total stockholder returns for AMC’s Common Stock, the Standard & Poor’s Corporation Composite 500 Index and a self-determined peer group consisting of Cinemark Holdings, Inc.

(CNK) and IMAX Corporation (IMAX) (“2018-2020 Peer Group”).

Prior to 2018, this peer group consisted of CNK and Regal Entertainment Group (“Regal”) (“2015-2017 Peer Group”).

Regal was acquired in 2018 and is no longer a publicly traded company.

With the loss of Regal as a publicly traded company in our peer group, we determined to add IMAX to our peer group in 2018.

(CNK) and IMAX Corporation (IMAX).

Measurement points are the last trading day for each month ended December 31, 2016 through December 31, 2021.

2 unchanged sentences

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among AMC Entertainment Holdings, Inc., the S&P 500 Index, and a 2015-2017 Peer Group and 2018-2020 Peer Group

Among AMC Entertainment Holdings, Inc., the S&P 500 Index, and a Peer Group

*$100 invested on December 31, 2016 in stock or in index, including reinvestment of dividends.

7 unchanged sentences

AMC Entertainment Holdings, Inc.

Selected Financial Data.

(In millions, except operating data)

Statement of Operations Data:

Food and beverage

Other revenue

Total revenues

Operating Costs and Expenses:

Film exhibition costs

Food and beverage costs

Operating expense, excluding depreciation and amortization below

General and administrative:

Merger, acquisition and other costs(1)

Other, excluding depreciation and amortization below

Depreciation and amortization

Impairment of long-lived assets, definite and indefinite-lived intangible assets and goodwill(2)

Operating costs and expenses

Operating income (loss)

Other expense (income)(3)

Interest expense:

Corporate borrowings

Capital and financing lease obligations

Non-cash NCM exhibitor services agreement(4)

Equity in (earnings) losses of non-consolidated entities(5)

Investment expense (income)(6)

Earnings (loss) before income taxes

Income tax provision (benefit)(7)

Net earnings (loss)

Net loss attributable to noncontrolling interests

Net earnings (loss) attributable to AMC Entertainment Holdings, Inc.

Earnings (loss) per share attributable to AMC Entertainment Holdings, Inc.'s common stockholders:

Average shares outstanding

Basic (in thousands)

Diluted (in thousands)

Dividends declared per basic and diluted common share

(In millions, except operating data)

Balance Sheet Data (at period end):

Cash and cash equivalents

Corporate borrowings

Other long-term liabilities(8)

Capital and financing lease obligations

AMC Entertainment Holdings, Inc.'s stockholder’s equity (deficit)

Net cash provided by (used in) operating activities

Capital expenditures

Screen additions

Screen acquisitions

Screen dispositions

Construction openings (closures), net

Average screens—continuing operations(9)

Number of screens operated

Number of theatres operated

Total number of circuit screens

Total number of circuit theatres

Screens per theatre

Attendance (in thousands)—continuing operations(9)

(1) Merger, acquisition and other costs related to expenses incurred in connection with the Carmike (acquired December 2016), Odeon (acquired November 2016) and Nordic (acquired March 2017) acquisitions.

During the year ended December 31, 2020, expenses were primarily due to legal and professional costs related to strategic contingent planning.

During the year ended December 31, 2019, expenses were primarily due to organizational design including one-time severance and outplacement costs of $9.8 million and acquisitions and divestitures including entity simplification costs of $4.0 million.

The year ended December 31, 2018 includes the write-off of $8.0 million of deferred costs related to an Odeon proposed public offering and $6.3 million of expense related to an arbitration ruling on a pre-acquisition date rent dispute for Odeon.

During the year ended December 31, 2017, merger, acquisition and other costs includes $22.6 million of expense for NCM common units surrendered as a part of the exclusivity waiver with NCM in connection with the Department of Justice (“DOJ”) Final Judgment (“Final Judgment”).

During the year ended December 31, 2016, merger, acquisition and other costs includes a $10.0 million management transaction bonus financed by a capital contribution from Wanda and related to the successful completion of the Odeon and Carmike acquisitions during 2016.

(2) During the year ended December 31, 2020, we recorded goodwill non-cash impairment 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, we recorded non-cash impairment charges related to our long-lived assets of $152.5 million on 101 theatres in the U.S.

markets with 1,139 screens and $25.4 million on 37 theatres in the International markets with 340 screens and recorded impairment charges related to indefinite-lived intangible assets of $12.5 million and $2.7 million related to the Odeon and Nordic trade names, respectively, in the International markets.

We also recorded non-cash impairment charges of $14.4 million for our definite-lived intangible assets in the Domestic Theatres reporting unit during the year ended December 31, 2020.

During the year ended December 31, 2019, we 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.

During the fourth quarter of 2018, we recorded non-cash impairment losses of $13.8 million on 13 theatres in the U.S.

markets with 150 screens and on 15 theatres in the International markets with 118 screens.

During calendar 2017, we recorded an impairment of long-lived assets loss of $43.6 million on 12 theatres in the U.S.

markets with 179 screens which was related to property held and used.

(3) 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 derivative liability and derivative asset for our 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 by a gain on extinguishment of the Second Lien Notes due 2026 of $93.6 million and financing related foreign currency transaction losses.

Other expense of $13.4

million during the year ended December 31, 2019 was primarily due to $16.6 million of expense related to the repayment of indebtedness, foreign currency transaction losses of $1.5 million, and non-operating net periodic benefit cost of $1.2 million, and the decrease in fair value of our derivative asset for the contingent call option related to the Class B common stock purchase and cancellation agreement of $17.7 million, partially offset by decrease in fair value of our derivative liability for the embedded conversion feature in our Convertible Notes of $23.5 million.

During the year ended December 31, 2018, other income of $108.1 million is primarily due to $66.4 million of income for the decrease in the fair value of the derivative liability related to the embedded conversion feature for the Convertible Notes and $45.0 million of income for the increase in fair value of the derivative asset related to the contingent call option for the cancellation of additional shares of Class B common stock in the Stock Purchase and Cancellation Agreement with Wanda.

See Note 8 — Corporate Borrowings and Finance Lease Obligations in the Notes to Consolidated Financial Statements under Part II, Item 8, thereof for further information regarding the derivative liability related to the embedded conversion feature, the call option for the cancellation of additional shares of Class B common stock.

(4) Non-cash NCM exhibitor services agreement includes a significant financing component due to the significant length of time between receiving the non-cash consideration and fulfilling the performance obligation.

We received the non-cash consideration in the form of common membership units from NCM, in exchange for rights to exclusive access to our theatre screens and attendees through February 2037.

Upon adoption of ASC 606 in year 2018, our advertising revenues have significantly increased with a similar offsetting increase in non-cash interest expense.

(5) Equity in (earnings) loss of non-consolidated entities includes impairment losses in the International markets related to equity method investments of $8.6 million during the year ended December 31, 2020.

Equity in earnings for the year ended December 31, 2018 includes a $28.9 million gain on the sale of all of our remaining interest in NCM and a $30.1 million gain related to the Screenvision merger.

During the year ended December 31, 2017, we recorded non-consolidated entity impairment losses and losses on dispositions of our NCM ownership interests of approximately $230.7 million.

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

Investment expense (income) during the year ended December 31, 2019 includes a gain on the sale of our Austria theatres of $12.9 million and a loss on impairment of an investment of $3.6 million.

During the year ended December 31, 2017, investment expense (income) includes a gain on sale of Open Road of $17.2 million.

Investment expense (income) includes a gain on sale of our shares in RealD, Inc.

of $3.0 million during the year ended December 31, 2016.

(7) During the year ended December 31, 2020, income tax expense was primarily due to the recording of international valuation allowances against deferred tax assets held in Spain of $40.1 million and Germany of $33.1 million, partially offset by income tax benefit from net losses incurred in International markets.

During the year ended December 31, 2019, an international valuation allowance previously established against deferred tax assets held in Spain was released in the fourth quarter of 2019 resulted in a $41.5 million benefit to income tax expense.

During the year ended December 31, 2017, we recorded the impact of the change in enacted Federal tax rates in our U.S.

jurisdictions of $88.6 million and the impact of a full valuation allowance on our deferred income taxes in U.S.

jurisdictions of $221.6 million, for an aggregate charge of approximately $310.0 million in the fourth quarter of 2017.

We estimate that we will have no liability for deemed repatriation of foreign earnings.

During the year ended December 31, 2016, we recorded a $19.2 million income tax benefit related to favorable resolutions of uncertain tax positions with authorities.

(8) Other long-term liabilities exclude operating lease liabilities, which were recorded to operating lease liabilities in the consolidated balance sheets effective in year 2019 upon adoption of ASC 842, Leases.

(9) Includes consolidated theatres only.

Not applicable

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 5. Market for Registrant’s Common Equity