AMC Entertainment seeks loan amendment of restricted payments basket

By Sara Rosenberg

New York, Feb. 8 - AMC Entertainment Inc. announced Thursday that it is looking to amend its senior secured credit facility to allow for up to $600 million in subordinated debt repayments to be carved out of the restricted payments basket, according to an 8-K filed with the Securities and Exchange Commission.

This carve out will be available for redemptions/repayments by April 30.

AMC is getting proceeds of about $490 million from the successful pricing of the National CineMedia, Inc. initial public offering, and these proceeds, along with up to $135 million of cash on hand, are expected to be used for the repayment indebtedness, all or a portion of which may include calling certain subordinated debt issues, which would constitute restricted payments under the senior secured credit facility.

Given AMC's current restricted payment basket amount, pro forma for an increase resulting from the National CineMedia transaction, would be insufficient to accommodate this debt repayment. For this reason, the company is seeking the loan amendment.

In addition to the restricted payments basket modification, the amendment will also revise the restricted payment basket to $200 million plus the available amount cumulative growth basket, which will start to build from $0 as of April 1, resulting in a net reduction in restricted payment capacity.

AMC is a Kansas City, Mo., theatrical exhibition company.

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