What does the Special Dividend mean for AMC holders? via /r/wallstreetbets #stocks #wallstreetbets #investing

What does the Special Dividend mean for AMC holders?

Full disclosure, normally I'm here just to insult people and laugh at you. In the past I may have sold you AMC calls which has paid for my new laptop and some very expensive vodka.

However to clear my conscience, I will have one go at explaining what the AMC Management ('Management') is about to do to common stock holders. As a reference I am exclusively using the SEC filings that AMC ('Company') has made in connection with the special dividend on August 4th.

You can find it here: Financial Performance – SEC Filings | AMC Theatres

Specifically there are two relevant documents


I'm also referring to the press statement the CEO has made which can be found anywhere in the web

I will use rounded numbers as to not overburden anyone's brain too much. I'll try to use short sentences and easy words. However, Management has made this transaction complicated.


  1. As of August 6th AMC has ca. 500m class A common shares ('Common Share') outstanding which trade under $AMC
  2. An vote to increase of the authorized amount of Commons initiated by Management has failed in 2021
  3. On Aug 4th 2022 the Company has filed forms 8-A and S-3 to register and issue 50m units of Preferred Stock ('P-Shares')
  4. On August 4th 2022 the Company has applied to list under the symbol $APE what they call AMC Preferred Equity Units ('P-Units')
  5. On August 4th 2022 the company has declared a special dividend of one P-Unit for each Common Share which will be fully completed on August 22 2022

Description of P-Shares and P-Units:

Comparison of the 3 share instruments issued by the Company

The table above shows the key qualities of the 3 share instruments. It is key to note that with the issuance of the P-Shares, the Common Shares and the P-Units only represent ca. 18.2% of the total voting rights.

What does this mean?

  • As of August 22nd, current holders of Common Shares will not be in control of the company anymore
    • Common Shares will represent ca. 9% voting rights
    • P-Unit ($APE) will holders represent ca. 9% of voting rights

  • As of August 22nd current holders of Common Shares will have a vastly reduced dividend entitlement
    • Common Shares will be entitled to ca. 9% of the total dividend
    • P-Units ($AMC) will be entitled to ca. 9% of the total dividend

  • The Management is free to issue the remaining P-Shares to any party they may choose

Further Provisions of the filings

  • The Management (without Shareholder consent) has the right to issue further P-Shares

I will not interpret the facts above, I think any half intelligent person will be able to put 1 and 1 together and figure out what this means. I want to close with a screenshot of the filings

Page 5 of the S-3 form submitted by AMC to the SEC

Submitted August 06, 2022 at 08:09AM by This_Professor8379
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