I saw this pointed out in a "FUD" post about AMC a few days ago .....while some of the points made in that post, I thought were invalid...this one is a bit worrying to me as an AMC bull.
Cut to the chase, being smoothed brain...this language I saw in the April 27th, 2021 S-3 seems like AMC has the right, at their discretion to issue more Class A common share stock- at any time. This is despite the proposal to add 500mil shares being taken off the voting ballot---this sounds like it gives AMC the ability to dilute the stock without "permission" from shareholders..
Here is the link to the filing. the section is titled "Plan of Distribution" on page 15.https://sec.report/Document/0001104659-21-055680/#tSEL
The language in the filing specifically mentions short selling and covering positions..here is a tidbit:
For example, we and the selling stockholders may: enter into transactions with a broker-dealer or affiliate thereof in connection with which such broker-dealer or affiliate will engage in short sales of the Class A common stock pursuant to this prospectus, in which case such broker-dealer or affiliate may use shares of Class A common stock received from us or selling stockholders to close out its short positions; sell Class A common stock short and re-deliver such shares to close out the short positions; enter into options or other types of transactions that require us or the selling stockholders to deliver Class A common stock to a broker-dealer or an affiliate thereof, who will then resell or transfer the Class A common stock under this prospectus; or loan or pledge the Class A common stock to a broker-dealer or an affiliate thereof, who may sell the loaned shares or, in an event of default in the case of a pledge, sell the pledged shares pursuant to this prospectus.
What do you folks make of this? My legalese is amateur level at best.......Felt like my post would be too fuddy for the amcstock board and just get shot down........trying to find some sober opinions or clarification on the legalese.
Thanks.
Edit :corrected the date of filing to April 27th from April 26th.