Equity Distribution Agreement. On December 11, 2020, the Company entered into an equity distribution agreement with Goldman Sachs & Co. LLC and B. Riley Securities, Inc., as sales agents to sell up to 178.0 million shares of the Company’s Class A common stock, par value $0.01 per share, through an “at-the-market” offering program. On January 25, 2021, the Company entered into equity distribution agreements with Goldman Sachs & Co. LLC and B. Riley Securities, Inc., as sales agents to sell up to 50.0 million shares of the Company’s Class A common stock, par value $0.01 per share, through an “at-the-market” offering program. During the three months ended March 31, 2021, the Company raised gross proceeds of approximately $596.9 million through its at-the-market offering for the remaining available shares under the equity distribution agreement of 187,066,293 shares of its Class A common stock and paid fees to the sales agents of approximately $14.9 million and other fees of $0.4 million. The Company intends to use the net proceeds from the sale of the Class A common stock pursuant to the equity distribution agreement for general corporate purposes, which may include the repayment, refinancing, redemption or repurchase of existing indebtedness or working capital, capital expenditures and other investments. See Note 13—Subsequent Event for information regarding the additional at-the-market offerings of 43 million shares of the Company’s Class A common stock.

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

On February 1, 2021, Wanda exercised their right to convert all outstanding Class B common stock of 46,103,784 to Class A common stock, thereby reducing the number of outstanding Class B common stock to zero, which resulted in the retirement of Class B common stock. The Third Amended and Restated Certificate of Incorporation of the Corporation provides that Class B common stock may not be reissued by the Company.

Dividends. There were no dividends declared to stockholders during the three months ended March 31, 2021. The following is a summary of dividends and dividend equivalents declared to stockholders during the three months ended March 31, 2020:

Related Party Transactions. As of March 31, 2021 and December 31, 2020, the Company recorded a receivable due from Wanda of $0 and $0.7 million, respectively, for reimbursement of general administrative and other expense incurred on behalf of Wanda. For the three months ended March 31, 2021 and March 31, 2020, the Company recorded approximately $0 million and $0.1 million, respectively, of cost reductions for general and administrative services provided on behalf of Wanda.

The Company recorded stock-based compensation expense of $5.4 million and $2.7 million within general and administrative: other during the three months ended March 31, 2021 and March 31, 2020, respectively. As of March 31, 2021, the remaining unrecognized compensation cost related to stock-based compensation arrangements was approximately $43.1 million. The weighted average period over which this remaining compensation expense will be recognized is approximately 1.5 years.

During the three months ended March 31, 2021, AMC’s Board of Directors approved awards of stock, restricted stock units (“RSUs”), and performance stock units (“PSUs”) to certain of the Company’s employees and directors under the 2013 Equity Incentive Plan. The grant date fair value of these awards during the three months ended March 31, 2021 was based on the closing price of AMC’s Class A common stock on February 23, 2021 of $7.70 per share. 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 Class A common stock underlying the unit. Any such accrued dividend equivalents are paid to the holder upon vesting of the units. Each unit represents the right to receive one share of Class A common stock at a future date.

●

Restricted Stock Unit Award Agreement: The Company granted RSU awards of 2,687,813 to certain members of management during the three months ended March 31, 2021 with a grant date fair value of $20.7 million. Each RSU represents the right to receive one share of Class A common stock at a future date. The RSUs vest over three years with 1/3 vesting in each year. These RSUs will be settled within 30 days of vesting.

●

Performance Stock Unit Award Agreement: During the three months ended March 31, 2021, total PSUs of 2,687,813 were awarded (“2021 PSU award”) to certain members of management and executive officers, with the total PSUs divided into three separate year tranches with each tranche allocated to a fiscal year within the performance period (“Tranche Year”). The PSUs within each Tranche Year are further divided between 2 performance targets; the Adjusted EBITDA performance target and free cash flow performance target. The 2021 PSU awards will vest based on achieving 80% to 120% of the performance targets with the corresponding vested unit amount ranging from 50% to 200%. If the performance targets are met at 100%, the 2021 PSU awards will vest at 2,687,813 units in the aggregate. No PSUs will vest for each Tranche Year if the Company does not achieve 80% of the Tranche Year’s Adjusted EBITDA and free cash flow targets. Additionally, vesting is subject to the participant’s continued employment through the end of the three-year cumulative period, ending on December 31, 2023. The vested PSUs will be settled within 30 days of vesting which will occur upon certification of performance results by the Compensation Committee of the Board of Directors.

The Compensation Committee establishes the annual performance targets at the beginning of each year, 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 718-10-55-95. The 2021 PSU award grant date fair value on February 23, 2021 for the 2021 Tranche Year award of 895,951 units was approximately $6.9 million. In addition, the February 23, 2021 grant date fair value for the 2021 Tranche Year under the 2020 PSU award agreement of 438,244 units and the 2019 PSU award agreement of 181,916 units was approximately $3.4 million and $1.4 million, respectively.

●

Special Performance Stock Unit (“SPSU”) Executive Award Agreement: In January 2021, the market condition requirement for SPSUs awarded in calendar year 2020 was met as a result of exceeding the 20-day trailing volume weighted average stock price threshold target for tranche 5 and tranche 6 of $4 and $8, respectively. The stock-based compensation costs for SPSUs are recorded on a straight-line basis through October 30, 2021, which is the end of the service requirement period.

The following table represents the nonvested RSU, PSU and SPSU activity for the three months ended March 31, 2021:


		Weighted
		Average
	Shares of RSU	Grant Date
	PSU and SPSU	Fair Value
Beginning balance at January 1, 2021 (1)	4,159,261	$	6.27
Granted (2)	3,583,764		7.70
Forfeited	(17,167)		5.22
Nonvested at March 31, 2021	7,725,858	$	6.94

(1)

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

(2)

Excludes Tranche Years 2022 and 2023 awarded under the 2021 PSU award.

Condensed Consolidated Statements of Stockholders’ Deficit

For the Three Months Ended March 31, 2021


												Accumulated
	Class A Voting			Class B Voting			Additional					Other		Accumulated		Total AMC
	Common Stock			Common Stock			Paid-in		Treasury Stock			Comprehensive		Earnings		Stockholders’		Noncontrolling		Total
(In millions, except share and per share data)	Shares	Amount		Shares	Amount		Capital		Shares	Amount		Income (Loss)		(Deficit)		Equity (Deficit)		Interests		Deficit
Balances December 31, 2020	172,563,249	$	1.8	51,769,784	$	0.5	$	2,465.6	3,732,625	$	(56.4)	$	38.7	$	(5,335.3)	$	(2,885.1)	$	26.9	$	(2,858.2)
Net loss	—		—	—		—		—	—		—		—		(566.9)		(566.9)		(0.3)		(567.2)
Other comprehensive loss	—		—	—		—		—	—		—		(51.0)		—		(51.0)		(0.2)		(51.2)
Baltics noncontrolling capital contribution	—		—	—		—		0.2	—		—		—		—		0.2		(4.0)		(3.8)
Class A common stock, accrued dividend equivalent adjustment	—		—	—		—		—	—		—		—		(0.1)		(0.1)		—		(0.1)
Class A common stock issuance	187,066,293		1.8	—		—		579.8	—		—		—		—		581.6		—		581.6
Wanda conversion of Class B shares to Class A shares	46,103,784		0.5	(46,103,784)		(0.5)		—	—		—		—		—		—		—		—
Convertible Notes due 2026 stock conversion	44,422,860		0.4	—		—		606.1	—		—		—		—		606.5		—		606.5
Wanda forfeit and cancellation of Class B shares	—		—	(5,666,000)		—		—	—		—		—		—		—		—		—
Taxes paid for restricted unit withholdings	—		—	—		—		—	—		—		—		—		—		—		—
Stock-based compensation	124,054		—	—		—		5.4	—		—		—		—		5.4		—		5.4
Balances March 31, 2021	450,280,240	$	4.5	—	$	—	$	3,657.1	3,732,625	$	(56.4)	$	(12.3)	$	(5,902.3)	$	(2,309.4)	$	22.4	$	(2,287.0)

Condensed Consolidated Statements of Stockholders’ Deficit

For the Three Months Ended March 31, 2020


												Accumulated
	Class A Voting			Class B Voting			Additional					Other				Total
	Common Stock			Common Stock			Paid-in		Treasury Stock			Comprehensive		Accumulated		Stockholders’
(In millions, except share and per share data)	Shares	Amount		Shares	Amount		Capital		Shares	Amount		Loss		Deficit		Equity (Deficit)
Balances December 31, 2019	52,080,077	$	0.5	51,769,784	$	0.5	$	2,001.9	3,732,625	$	(56.4)	$	(26.1)	$	(706.2)	$	1,214.2
Cumulative effect adjustment for the adoption of new accounting principle (ASU 2016-13)	—		—	—		—		—	—		—		—		(16.9)		(16.9)
Net loss	—		—	—		—		—	—		—		—		(2,176.3)		(2,176.3)
Other comprehensive loss	—		—	—		—		—	—		—		(93.5)		—		(93.5)
Dividends declared:
Class A common stock, $0.03/share, net of forfeitures	—		—	—		—		—	—		—		—		(1.6)		(1.6)
Class B common stock, $0.03/share	—		—	—		—		—	—		—		—		(1.6)		(1.6)
Taxes paid for restricted unit withholdings	—		—	—		—		(1.0)	—		—		—		—		(1.0)
Stock-based compensation	469,516		—	—		—		2.7	—		—		—		—		2.7
Balances March 31, 2020	52,549,593	$	0.5	51,769,784	$	0.5	$	2,003.6	3,732,625	$	(56.4)	$	(119.6)	$	(2,902.6)	$	(1,074.0)