National CineMedia objects to Chapter 11 plan confirmation appeal

By Sarah Lizee

Olympia, Wash., July 14 – National CineMedia, LLC objected Thursday to a joint appeal filed by American Multi-Cinema, Inc. and Cinemark USA, Inc. to confirmation of the debtor’s Chapter 11 plan, according to documents filed with the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, the appellants have asked for a stay of the settlement order and the confirmation order to preserve their rights under exhibitor services agreements.

The movants are appealing the court’s findings that determined that their rights under the MFN provisions in the agreements were not triggered.

National CineMedia said Thursday the movants want to derail the plan and stop the case in its tracks.

“AMC and Cinemark – partners whose contracts will be assumed, who will be paid in full on the effective date, and for whom the debtor has orchestrated its entire restructuring to ensure its continued performance under the joint venture agreements – ask for this extraordinary relief while ignoring the devastating consequences to the debtor from a stay,” the debtor said in its objection.

The company said it is just weeks away from discharging $1.2 billion of debt, preserving jobs for hundreds of employees, and finally moving past the impacts of the Covid-19 pandemic on the movie industry.

National CineMedia said that, despite overwhelming support for the plan, AMC and Cinemark seek a stay, without approaching the necessary showing, to advance their own interests in reneging on the exhibitor services Agreements (ESAs), while at the same time keeping the nearly $1 billion that the debtor paid to AMC and Cinemark in 2007 for entering into the ESAs.

“While movants face no irreparable injury, the harm to the debtor from a stay would be severe and risks fundamentally upsetting the restructuring transactions supporting the debtor’s exit from bankruptcy,” the company said.

The appeal has been assigned to U.S. district judge Andrew S. Hanen.

National CineMedia is a Centennial, Colo.-based integrated media company. The company filed bankruptcy on April 11 under Chapter 11 case number 23-90291.

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