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RLJ Entertainment Ups AMC Networks Loan by $10 Million

20 Jun, 2017 By: Erik Gruenwedel

Home entertainment distributor to use funds to accelerate original content spending for Acorn TV and Urban Movie Channel

RLJ Entertainment June 20 disclosed it increased a loan commitment to AMC Networks by $10 million. The AMC Networks Tranche A Term loan was expanded to $23 million, from $13 million.

In addition, RLJE namesake, Robert L. Johnson, converted 100% of his preferred stock into common stock.

The Baltimore, Md.-based home entertainment distributor said it would use the funds to increase spending on original content.

The pay-TV network will now receive interest payments in the form of RLJE common stock priced at $3 per share. AMC also exercised $5 million in Tranche A Warrants in exchange for 1,667,000 shares of RLJE’s common stock. The shares cancel $5 million of the Tranche B Loan, leaving a balance due of $54.9 million.

Should AMC exercise all remaining warrants, it would effectively take controlling ownership of RLJ Entertainment.

June 15, RLJE Films announced its upcoming theatrical and on-demand release slate. Titles include action-comedy Once Upon a Time in Venice, starring Bruce Willis, Thomas Middleditch ("Silicon Valley"), Jason Momoa ("Game of Thrones," Justice League), and John Goodman; thriller The Limehouse Golem, starring Bill Nighy (Love Actually, Underworld), Olivia Cooke ("Bates Motel") and Douglas Booth (Pride + Prejudice + Zombies); action/science-fiction film, The Osiris Child, starring Kellan Lutz; as well as action thrillers, Pilgrimage, starring Tom Holland (Spider-Man: Homecoming), Richard Armitage (The Hobbit trilogy, “Berlin Station”) and Jon Bernthal ("The Walking Dead," "The Punisher"); Bushwick, starring Dave Bautista (Guardians of the Galaxy, Spectre) and Brittany Snow (Pitch Perfect); and Mayhem, starring Steven Yeun ("The Walking Dead").

“With OTT adoption gaining increased acceptance among consumers, we see a unique window of opportunity to take advantage of this trend. This financing reallocates significant levels of cash and limits the company's level of financial leverage, while increasing shareholders' equity,” Miguel Penella, CEO of RLJ Entertainment, said in a statement.

Penella said the funds would also be used to marketing awareness and subscription, and in broadening Acorn TV and UMC’s domestic and international distribution.

“Accelerating our digital channel growth should in turn drive faster emergence of our higher-margin business model. Our partnership with AMC Networks has not only been financially beneficial, but also extremely productive in terms of our strategic collaboration on programming opportunities,” he said.

About the Author: Erik Gruenwedel

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