AMC CEO Adam Aron files to sell 1.25 million shares, after warning meme investors he would do so

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  • AMC CEO Adam Aaron has filed paperwork with the SEC that will allow him to sell 1.25 million shares of the company at current prices for approximately $48 million.
  • The sale will be part of executives’ estate plan ahead of its 67th birthday next year, Aaron told investors last August.
  • At the end of these sales, Aaron said he would still have more than two million shares of the company.

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AMC Entertainment CEO Adam Aaron has filed with the Securities and Exchange Commission the paperwork that will allow him to sell 1.25 million shares of the movie theater company.

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The sale will be part of executives’ estate plan ahead of its 67th birthday next year, Aaron told investors last August. He reiterated those plans during an earnings call with investors and analysts on Monday.

AMC has a stake of about $48 million as of Wednesday. The stock dropped 4% in the session.

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“On our last call, I also told you that in September of 2021, I will be 67 years old, a young, vibrant, full of life 67 I might add, but 67 nonetheless,” he told investors. Call. “Prudent estate planning suggests that I should diversify my estate a bit, especially with Congress to discuss potentially increasing capital gains tax rates and significant changes that could be passed on to one’s heirs.” “

Aaron once again told investors that during his nearly six years with AMC he had never sold any of his shares, except for the 500,000 shares he had gifted to his adult children. He also said that any potential stock sales would take place during three different calendar months.

At the end of these sales, Aaron said he would still have more than two million shares of the company.

AMC representatives were not immediately available to comment. The filing appeared on a section of the SEC website that displays filings submitted in paper form via email. Insider Sales Analyst Ben Silverman of InsiderScore.com confirmed its authenticity.

Silverman said the form gave Aaron the right to sell the entire 1,250,000-share stake already in place or over a period of days, weeks and months to come. It won’t be clear at what speed Aaron is selling the shares until separate forms are filed on those individual sales with the SEC.

“If you do the math, you’ll see that with so much current and future ownership of AMC, our company, AMC Entertainment, I have a huge personal stake in the future of your company,” he said. “I strongly believe in AMC and my interests are highly aligned with that of our broad shareholder base so that the value of your ongoing investment and my ongoing investment in AMC Entertainment stock are highly valued.”

Buoyed by the meme stock craze this year, AMC shares have gained over 1,700 per cent this year.

The movie theater chain was hit hard by the pandemic and nearly filed for bankruptcy in late 2020. However, a rise in its shares allowed the company to achieve nearly $2 billion in liquidity and stabilized as it resumed box office.

During the third quarter, the company saw entry revenue increase to $425.1 million from $62.9 million in the year-ago period. Its food and beverage sales also increased from just $29.1 million to $265.2 million on a year-over-year basis.

Still, AMC’s operating costs outpaced its revenue, leaving the company with a loss for the quarter. The company said that if the domestic box office reaches at least $2 billion during the months of October, November and December, it will be able to post positive cash flow for the fourth quarter.

—With reporting by Yoon Lee.

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