These morons are so predictable.. it’s comical!

(Correcting my post - as the Debt Covenants are actually EBITDA based)

A youtuber (StockRetail) May have made an accurate realization of whats happening:

1. The Debt Covenants on AMC require AMC to maintain a certain leverage ratio of Debt / EBITDA
2. For example, if the debt is 3.9B, and EBITDA 390M, thats a ratio of 10.
3. AMC's Current Debt/Ebitda ratio is 7.9x.
4. Lenders may have stricter covenants. OR, if the ratio is improved, AMC pays lesser in interest.
5. In that case, AMC has to reduce the debt directly.

That may be the reason for the last two dilutions. (Its conjecture, nothing confirmed. But sounds right).

1. Today, AMC has a CCC+ Credit Rating But with lower debt, and more incoming cash from this year, it's rating will improve.
2. With an improving credit rating, AMC can refinance the debt to lower rates, saving anywhere from 60M (rating of B-) - 225M (rating of BBB-) / year in interest payments.
3. The ratings will improve over time. The next rung of rating from CCC- is B-. BBB- is a long way off - and requires very low debt.

Credits to StockRetail for this analysis. Its very good!

https://preview.redd.it/pq3wvob7kb9h1.png?width=1692&format=png&auto=webp&s=08dccd4b783b2462c219b4e98fbbeedb6d4efb41

https://preview.redd.it/od0azdwdkb9h1.png?width=1692&format=png&auto=webp&s=58c490c5bbb2137a9b27841d8502420b846466e5

Pricing Level	Total Leverage Ratio (Debt/EBITDA)	Incremental Cash Rate	Incremental PIK Rate
Level 1	≥ 7.50x	+1.50%	+6.00%
Level 2	< 7.50x and ≥ 6.50x	+2.375%	+2.375%
Level 3	< 6.50x	+4.00%	—

This means the leverage ratio does not trigger a default — instead, it raises or lowers AMC's interest rate on the Senior Secured Notes due 2029 . If Debt/EBITDA stays above 7.5x (AMC's current position is approximately 5.7x–6.4x depending on the metric used ), lenders extract more yield via PIK (payment-in-kind) interest. Below 6.5x, AMC pays a higher cash rate (4.00%) in exchange for no PIK toggle.

https://preview.redd.it/54c0zurwkb9h1.png?width=1809&format=png&auto=webp&s=fdaf2e33b0abeb73a3bc3aad046fb29e1a4484c7

https://preview.redd.it/qcz3zzs3lb9h1.png?width=1502&format=png&auto=webp&s=1719b66530f72ffe098358d616f2abba7738cc6c

Loop:
>>> Dilushion
>>> Adam Aron Bad (Anti Semitic Undertones)
>>> Outstanding shares 982120000 exp 10 of original float in 1894
Repeat

That's it?

Live it up, Zoners! Enjoy!! Let out all the poisonous bile you've built up! Vomit out all the sick fantasies! Become millionaires today because magically every zoner trash had bought [puts].

Enjoy!

Really hoping their (i.e your) kids don’t turn out to be the Desicable , Pathetic, America hating predatory short selling enablers like their dads.

(PS: It may sound insulting, because it low key is; But you have to agree with me on this 😂)

Edit: Sounds like I struck a few nerves 😂😂😂😂

Enlighten us Zoners. Need some more motivation to buy more