SEC Filing | AMC Networks Inc.

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amcx-20210630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☑			Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2021


☐			Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File Number: 1-35106

AMC Networks Inc.

(Exact name of registrant as specified in its charter)


Delaware		27-5403694
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

11 Penn Plaza,
New York,	NY	10001
(Address of principal executive offices)		(Zip Code)

(212) 324-8500

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Class A Common Stock, par value $0.01 per share

AMCX

The

NASDAQ

Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company (as defined in Exchange Act Rule 12b-2).


Large accelerated filer	þ	Accelerated filer	¨

Non-accelerated filer	¨	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

The number of shares of common stock outstanding as of July 30, 2021:


Class A Common Stock par value $0.01 per share			30,731,275
Class B Common Stock par value $0.01 per share			11,484,408

AMC NETWORKS INC. AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS


			Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Condensed Consolidated Balance Sheets			1
Condensed Consolidated Statements of Income			2
Condensed Consolidated Statements of Comprehensive Income			3
Condensed Consolidated Statements of Stockholders' Equity			4
Condensed Consolidated Statements of Cash Flows			6
Notes to Condensed Consolidated Financial Statements			7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			23
Item 3. Quantitative and Qualitative Disclosures About Market Risk			44
Item 4. Controls and Procedures			45
PART II. OTHER INFORMATION
Item 1. Legal Proceedings			46
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			46
Item 6. Exhibits			46
SIGNATURES			47

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

AMC NETWORKS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

(unaudited)


	June 30, 2021		December 31, 2020
ASSETS
Current Assets:
Cash and cash equivalents	$	980,726	$	888,526
Accounts receivable, trade (less allowance for doubtful accounts of $10,548 and $11,234)	807,499		813,587
Current portion of program rights, net	18,091		13,480
Prepaid expenses and other current assets	221,846		223,173
Total current assets	2,028,162		1,938,766
Property and equipment, net of accumulated depreciation of $272,532 and $261,082	221,555		256,045
Program rights, net	1,551,717		1,269,131
Intangible assets, net	395,998		410,672
Goodwill	702,451		686,407
Deferred tax asset, net	15,496		25,046
Operating lease right-of-use asset	122,322		146,522
Other assets	441,808		513,749
Total assets	$	5,479,509	$	5,246,338
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	100,758	$	120,530
Accrued liabilities	482,968		320,005
Current portion of program rights obligations	265,058		259,449
Deferred revenue	76,504		71,048
Current portion of long-term debt	16,875		75,000
Current portion of lease obligations	33,203		32,435
Total current liabilities	975,366		878,467
Program rights obligations	220,279		182,511
Long-term debt	2,817,789		2,774,307
Lease obligations	155,397		194,324
Deferred tax liability, net	143,358		132,009
Other liabilities	94,748		125,970
Total liabilities	4,406,937		4,287,588
Commitments and contingencies
Redeemable noncontrolling interests	289,030		315,649
Stockholders' equity:
Class A Common Stock, $0.01 par value, 360,000 shares authorized, 65,324 and 64,568 shares issued and 30,731 and 29,975 shares outstanding, respectively	653		646
Class B Common Stock, $0.01 par value, 90,000 shares authorized, 11,484 shares issued and outstanding	115		115
Preferred stock, $0.01 par value, 45,000 shares authorized; none issued	—		—
Paid-in capital	330,593		323,425
Accumulated earnings	1,970,357		1,847,451
Treasury stock, at cost (34,593 and 34,593 shares Class A Common Stock, respectively)	(1,419,882)		(1,419,882)
Accumulated other comprehensive loss	(148,167)		(134,950)
Total AMC Networks stockholders' equity	733,669		616,805
Non-redeemable noncontrolling interests	49,873		26,296
Total stockholders' equity	783,542		643,101
Total liabilities and stockholders' equity	$	5,479,509	$	5,246,338

See accompanying notes to condensed consolidated financial statements.

AMC NETWORKS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

(unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenues, net	$	771,392	$	646,291	$	1,463,133	$	1,380,666
Operating expenses:
Technical and operating (excluding depreciation and amortization)	338,841		282,503		619,413		626,563
Selling, general and administrative	198,618		155,163		390,153		339,812
Depreciation and amortization	22,604		25,905		47,850		52,635
Impairment and other charges	142,918		130,411		158,973		130,411
Restructuring and other related charges	155		3,507		8,780		9,473
Total operating expenses	703,136		597,489		1,225,169		1,158,894
Operating income	68,256		48,802		237,964		221,772
Other income (expense):
Interest expense	(31,519)		(34,301)		(66,261)		(71,865)
Interest income	3,008		3,727		5,350		8,282
Loss on extinguishment of debt	—		—		(22,074)		(2,908)
Miscellaneous, net	14,174		8,713		19,580		(21,226)
Total other expense	(14,337)		(21,861)		(63,405)		(87,717)
Income from operations before income taxes	53,919		26,941		174,559		134,055
Income tax expense	(11,321)		(9,707)		(37,236)		(43,295)
Net income including noncontrolling interests	42,598		17,234		137,323		90,760
Net income attributable to noncontrolling interests	(6,713)		(2,273)		(14,417)		(7,132)
Net income attributable to AMC Networks' stockholders	$	35,885	$	14,961	$	122,906	$	83,628

Net income per share attributable to AMC Networks' stockholders:
Basic	$	0.84	$	0.29	$	2.91	$	1.55
Diluted	$	0.83	$	0.28	$	2.84	$	1.54

Weighted average common shares:
Basic	42,481		52,311		42,207		53,894
Diluted	43,382		52,797		43,277		54,429

See accompanying notes to condensed consolidated financial statements.

AMC NETWORKS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Net income including noncontrolling interests	$	42,598	$	17,234	$	137,323	$	90,760
Other comprehensive income (loss):
Foreign currency translation adjustment	7,675		14,190		(14,349)		(14,092)
Unrealized gain (loss) on interest rate swaps	598		341		1,208		(1,656)
Other comprehensive loss, before income taxes	8,273		14,531		(13,141)		(15,748)
Income tax (expense) benefit	(141)		(79)		(284)		386
Other comprehensive loss, net of income taxes	8,132		14,452		(13,425)		(15,362)
Comprehensive income	50,730		31,686		123,898		75,398
Comprehensive income attributable to noncontrolling interests	(6,775)		(2,472)		(14,209)		(6,170)
Comprehensive income attributable to AMC Networks' stockholders	$	43,955	$	29,214	$	109,689	$	69,228

See accompanying notes to condensed consolidated financial statements.

AMC NETWORKS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands)

(unaudited)


	Class A Common Stock		Class B Common Stock		Paid-in Capital		Accumulated Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		AMC Networks Stockholders’ Equity		Noncontrolling Interests		Total Stockholders' Equity
Balance, March 31, 2021	$	653	$	115	$	314,331	$	1,934,472	$	(1,419,882)	$	(156,237)	$	673,452	$	48,109	$	721,561
Net income attributable to AMC Networks’ stockholders	—		—		—		35,885		—		—		35,885		—		35,885
Net income attributable to non-redeemable noncontrolling interests	—		—		—		—		—		—		—		3,143		3,143


Distribution to noncontrolling member	—		—		—		—		—		—		—		(1,441)		(1,441)

Other comprehensive income	—		—		—		—		—		8,070		8,070		62		8,132
Share-based compensation expense	—		—		16,262		—		—		—		16,262		—		16,262




Balance, June 30, 2021	$	653	$	115	$	330,593	$	1,970,357	$	(1,419,882)	$	(148,167)	$	733,669	$	49,873	$	783,542


	Class A Common Stock		Class B Common Stock		Paid-in Capital		Accumulated Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		AMC Networks Stockholders’ Equity		Noncontrolling Interests		Total Stockholders' Equity
Balance, March 31, 2020	$	643	$	115	$	282,153	$	1,676,139	$	(1,149,138)	$	(196,364)	$	613,548	$	23,848	$	637,396
Net income attributable to AMC Networks’ stockholders	—		—		—		14,961		—		—		14,961		—		14,961
Net income attributable to non-redeemable noncontrolling interests	—		—		—		—		—		—		—		(818)		(818)




Settlement of treasury stock	—		—		10,988		—		—		—		10,988		—		10,988
Other comprehensive loss	—		—		—		—		—		14,253		14,253		199		14,452

Share-based compensation expense	—		—		15,235		—		—		—		15,235		—		15,235
Treasury stock acquired	—		—		—		—		(16,981)		—		(16,981)		—		(16,981)
Restricted stock units converted to shares	—		—		(88)		—		—		—		(88)		—		(88)
Balance, June 30, 2020	$	643	$	115	$	308,288	$	1,691,100	$	(1,166,119)	$	(182,111)	$	651,916	$	23,229	$	675,145

See accompanying notes to condensed consolidated financial statements.

AMC NETWORKS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands)

(unaudited)


	Class A Common Stock		Class B Common Stock		Paid-in Capital		Accumulated Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		AMC Networks Stockholders’ Equity		Noncontrolling Interests		Total Stockholders' Equity
















Balance, December 31, 2020	$	646	$	115	$	323,425	$	1,847,451	$	(1,419,882)	$	(134,950)	$	616,805	$	26,296	$	643,101
Net income attributable to AMC Networks’ stockholders	—		—		—		122,906		—		—		122,906		—		122,906
Net income attributable to non-redeemable noncontrolling interests	—		—		—		—		—		—		—		4,278		4,278
Transfer from redeemable noncontrolling interests	—		—		—		—		—		—		—		18,367		18,367
Contribution from noncontrolling member	—		—		—		—		—		—		—		1,140		1,140


Other comprehensive income (loss)	—		—		—		—		—		(13,217)		(13,217)		(208)		(13,425)
Share-based compensation expense	—		—		29,708		—		—		—		29,708		—		29,708

Proceeds from the exercise of stock options	—		—		12,100		—		—		—		12,100		—		12,100

Restricted stock units converted to shares	7		—		(34,640)		—		—		—		(34,633)		—		(34,633)
Balance, June 30, 2021	$	653	$	115	$	330,593	$	1,970,357	$	(1,419,882)	$	(148,167)	$	733,669	$	49,873	$	783,542


	Class A Common Stock		Class B Common Stock		Paid-in Capital		Accumulated Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		AMC Networks Stockholders’ Equity		Noncontrolling Interests		Total Stockholders' Equity
Balance, December 31, 2019	$	639	$	115	$	286,491	$	1,609,428	$	(1,063,181)	$	(167,711)	$	665,781	$	25,724	$	691,505
Net income attributable to AMC Networks’ stockholders	—		—		—		83,628		—		—		83,628		—		83,628
Net income attributable to non-redeemable noncontrolling interests	—		—		—		—		—		—		—		(1,085)		(1,085)
Distributions to noncontrolling member	—		—		—		—		—		—		—		(448)		(448)

Adoption of ASU 2016-13, credit losses	—		—		—		(1,956)				—		(1,956)		—		(1,956)

Other comprehensive loss	—		—		—		—		—		(14,400)		(14,400)		(962)		(15,362)
Share-based compensation expense	—		—		30,747		—		—		—		30,747		—		30,747

Treasury stock acquired	—		—				—		(102,938)		—		(102,938)		—		(102,938)
Restricted stock units converted to shares	4		—		(8,950)		—		—		—		(8,946)		—		(8,946)
Balance, June 30, 2020	$	643	$	115	$	308,288	$	1,691,100	$	(1,166,119)	$	(182,111)	$	651,916	$	23,229	$	675,145

See accompanying notes to condensed consolidated financial statements.

AMC NETWORKS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)/(unaudited)


	Six Months Ended June 30,
	2021		2020
Cash flows from operating activities:
Net income including noncontrolling interests	$	137,323	$	90,760
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization	47,850		52,635
Impairment and other charges	158,973		130,411
Share-based compensation expense related to equity classified awards	29,709		30,747
Non-cash restructuring and other related charges	4,329		6,126
Amortization and write-off of program rights	333,348		415,255
Amortization of deferred carriage fees	7,633		13,749
Unrealized foreign currency transaction (gain) loss	(10,609)		13,941
Amortization of deferred financing costs and discounts on indebtedness	3,923		4,088
Loss on extinguishment of debt	22,074		2,908
Bad debt expense	3,530		1,744
Deferred income taxes	16,487		10,437
Gain on investments	(4,554)		(13,958)
Write-down of non-marketable equity securities and note receivable	—		20,000
Other, net	(7,776)		(1,985)
Changes in assets and liabilities:
Accounts receivable, trade (including amounts due from related parties, net)	7,913		55,365
Prepaid expenses and other assets	(18,233)		45,953
Program rights and obligations, net	(583,480)		(387,027)
Income taxes payable	(5,472)		256
Deferred revenue	1,203		(5,086)
Deferred carriage fees, net	(27,861)		(15,995)
Accounts payable, accrued liabilities and other liabilities	14,857		(45,412)
Net cash provided by operating activities	131,167		424,912
Cash flows from investing activities:
Capital expenditures	(18,849)		(22,172)
Return of capital from investees	—		924
Payments for acquisition of a business, net of cash acquired	(19,072)		—
Acquisition of investment securities	(28,397)		(1,250)
Cash paid on distribution of business	(7,052)		—
Principal payment received on loan to investee	20,000		2,500
Proceeds from sale of investments	95,370		10,000
Net cash provided by (used in) investing activities	42,000		(9,998)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	984,500		6,000
Principal payments on long-term debt	(1,015,000)		(218,750)
Deemed repurchases of restricted stock units	(34,632)		(8,946)
Purchase of treasury stock	—		(102,938)
Proceeds from stock option exercises	12,100		—
Principal payments on finance lease obligations	(1,984)		(1,575)
Contributions from noncontrolling interests	2,702		—
Distributions to noncontrolling interests	(11,912)		(10,607)
Net cash used in financing activities	(64,226)		(336,816)
Net increase in cash and cash equivalents	108,941		78,098
Effect of exchange rate changes on cash and cash equivalents	(16,741)		(4,381)
Cash and cash equivalents at beginning of period	888,526		816,170
Cash and cash equivalents at end of period	$	980,726	$	889,887

See accompanying notes to condensed consolidated financial statements.

AMC NETWORKS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Note 1. Description of Business and Basis of Presentation

Description of Business

AMC Networks Inc. ("AMC Networks") and its subsidiaries (collectively referred to as the "Company," "we," "us," or "our") own and operate entertainment businesses and assets.

Segment Reporting Changes

In the first quarter of 2021, the Company changed its presentation of operating segments, reflecting a reorganized operating structure focused on a multi-platform distribution approach to content monetization. The Company's streaming services and IFC Films, previously included in the International and Other segment, are now included within Domestic Operations (formerly referred to as the National Networks segment). In addition, certain corporate overhead costs will no longer be allocated to the operating segments. Operating segment information for the prior periods has been recast to reflect these changes. The new reporting structure consists of the following two operating segments:

•Domestic Operations: Includes activities of our five national programming networks, our streaming services, AMC Studios operation, IFC Films and AMC Broadcasting & Technology. Our national programming networks are AMC, WE tv, BBC AMERICA, IFC, and SundanceTV. Our streaming services consist of our targeted subscription streaming services (Acorn TV, Shudder, Sundance Now, and ALLBLK), AMC+ and other streaming initiatives. Our AMC Studios operation produces original programming for our programming networks and also licenses such programming worldwide. IFC Films is our film distribution business and AMC Networks Broadcasting & Technology is our technical services business, which primarily services most of the national programming networks.

•International and Other: Includes AMC Networks International ("AMCNI"), our international programming businesses consisting of a portfolio of channels around the world and 25/7 Media (formerly Levity), our production services business. See Note 4 relating to the spin-off of the Levity comedy venues business.

Basis of Presentation

Principles of Consolidation

The consolidated financial statements include the accounts of AMC Networks and its subsidiaries in which a controlling voting interest is maintained or variable interest entities ("VIEs") in which the Company has determined it is the primary beneficiary. All intercompany transactions and balances have been eliminated in consolidation.

Investments in business entities in which the Company lacks control but does have the ability to exercise significant influence over operating and financial policies are accounted for using the equity method of accounting.

Unaudited Interim Financial Statements

These condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and Article 10 of Regulation S-X of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the Company's consolidated financial statements and notes thereto for the year ended December 31, 2020 contained in the Company's Annual Report on Form 10-K ("2020 Form 10-K") filed with the SEC. The condensed consolidated financial statements presented in this Quarterly Report on Form 10-Q are unaudited; however, in the opinion of management, such financial statements reflect all adjustments, consisting solely of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods presented.

The results of operations for interim periods are not necessarily indicative of the results that might be expected for future interim periods or for the full year ending December 31, 2021.

Risks and Uncertainties

The Company continues to monitor the ongoing impact of the COVID-19 pandemic on all aspects of its business. The Company cannot reasonably predict the ultimate impact of the COVID-19 pandemic, including the extent of any adverse impact on our business, results of operations and financial condition, which will depend on, among other things, the duration and spread of the pandemic, the impact of governmental regulations that have been, and may continue to be, imposed in response to the pandemic, the effectiveness of actions taken to contain or mitigate the outbreak, the availability, safety and efficacy of vaccines, and global economic conditions. The Company does not expect the COVID-19 pandemic and its related economic impact to affect its liquidity position or its ongoing ability to meet the covenants in its debt instruments.

Use of Estimates

AMC NETWORKS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(unaudited)

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates and judgments inherent in the preparation of the consolidated financial statements include the useful lives and methodologies used to amortize and assess recoverability of program rights, the estimated useful lives of intangible assets and the valuation and recoverability of goodwill and intangible assets.

Recently Adopted Accounting Standards

Effective January 1, 2021, the Company adopted Financial Accounting Standard Board (“FASB”) Accounting Standards Update (“ASU”) 2019-12, Simplifying the Accounting for Income Taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 - Income Taxes. The adoption of the standard did not have a material effect on its consolidated financial statements.

Note 2. Revenue Recognition

Transaction Price Allocated to Future Performance Obligations

As of June 30, 2021, other than contracts for which the Company has applied the practical expedients, the aggregate amount of transaction price allocated to future performance obligations was not material to our consolidated revenues.

Contract Balances from Contracts with Customers

The following table provides information about receivables, contract assets, and contract liabilities from contracts with customers.


(In thousands)	June 30, 2021		December 31, 2020
Balances from contracts with customers:
Accounts receivable (including long-term, included in Other assets)	$	1,030,795	$	1,081,070
Contract assets, short-term (included in Other current assets)	8,701		9,830
Contract assets, long-term (included in Other assets)	942		942
Contract liabilities (Deferred revenue)	76,504		71,048

Revenue recognized for the six months ended June 30, 2021 relating to the contract liability at December 31, 2020 was $17.7 million.

Note 3. Net Income per Share

The following is a reconciliation between basic and diluted weighted average shares outstanding:


(In thousands)	Three Months Ended June 30,		Six Months Ended June 30,
	2021	2020	2021	2020
Basic weighted average common shares outstanding	42,481	52,311	42,207	53,894
Effect of dilution:
Stock options	—	—	6	—
Restricted stock units	901	486	1,064	535
Diluted weighted average common shares outstanding	43,382	52,797	43,277	54,429

Approximately 0.5 million and 1.2 million restricted stock units outstanding as of June 30, 2021 and June 30, 2020, respectively, have been excluded from diluted weighted average common shares outstanding since a performance condition for these awards had not been met in each of the respective periods. As of June 30, 2021 and June 30, 2020, 0.3 million and 0.7 million, respectively, of restricted stock units and stock options have been excluded from diluted weighted average common shares outstanding, as their impact would have been anti-dilutive.

Stock Repurchase Program

The Company's Board of Directors has authorized a program to repurchase up to $1.5 billion of its outstanding shares of common stock (the "Stock Repurchase Program"). The Stock Repurchase Program has no pre-established closing date and may be suspended or discontinued at any time. For the six months ended June 30, 2021, the Company did not repurchase any shares of its Class A Common Stock. As of June 30, 2021, the Company had $135.3 million of authorization remaining for repurchase under the Stock Repurchase Program.

AMC NETWORKS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(unaudited)

Note 4. Impairment and Other Charges

On July 16, 2021, the Company entered into a settlement agreement (the “Settlement Agreement”) with Frank Darabont, Ferenc, Inc., Darkwoods Productions, Inc., and Creative Artists Agency, LLC (together, the "Plaintiffs") in actions brought in connection with Frank Darabont’s rendering services as a writer, director and producer of the television series entitled The Walking Dead. The consolidated cases were initially brought in 2013 and 2018 and the trial of the consolidated cases was scheduled to commence on April 4, 2022. The Settlement Agreement provides for a cash payment of $200 million (the “Settlement Payment”) to the Plaintiffs and future revenue sharing related to certain future streaming exhibition of The Walking Dead and Fear The Walking Dead. With regard to the Settlement Payment, the Company recorded a charge of $143.0 million, included in Impairment and other charges in consideration for the extinguishment of Plaintiffs’ rights to any compensation in connection with The Walking Dead and any related programs and the dismissal of the actions with prejudice, which amount is net of $57.0 million of ordinary course accrued participations.

In March 2021, the Company completed a spin-off of the live comedy venue and talent management businesses ("LiveCo") of Levity Entertainment Group, LLC. In connection with the transaction, the Company effectively exchanged all of its rights and interests in LiveCo for the release of the Company's obligations, principally related to leases. As a result of this divestiture, the Company recognized a loss on the disposal of $16.1 million reflecting the net assets transferred (consisting of property and equipment, lease right-of-use assets and intangibles, partially offset by lease and other obligations), which is included in Impairment and other charges. The Company retained its interest in the production services business of Levity Entertainment Group, LLC, which was renamed 25/7 Media Holdings, LLC following the spin-off.

In June 2020, as a result of the impact of the COVID-19 pandemic, the Company qualitatively assessed whether it was more likely than not that goodwill and long-lived assets were impaired as of June 30, 2020. Based on our projections and updated forecasts, the Company determined that sufficient indicators of potential impairment of long-lived assets existed and, in connection with the preparation of the Company's second quarter financial information, the Company performed a recoverability test of certain long-lived asset groups within the AMCNI reporting unit. This resulted in an impairment charge of $105.3 million for the three and six months ended June 30, 2020 primarily related to certain identifiable intangible assets, as well as property and equipment, and operating lease right-of-use assets. The Company then performed a goodwill impairment test and determined that the carrying value of the AMCNI reporting unit exceeded its fair value, resulting in an impairment charge of $25.1 million for the three and six months ended June 30, 2020.

Note 5. Restructuring and Other Related Charges

Restructuring and other related charges of $0.2 million and $8.8 million for the three and six months ended June 30, 2021, respectively, consisted of $0.2 million and $4.3 million of severance costs associated with the restructuring plan announced in November 2020 for the three and six months ended June 30, 2021, respectively, and $4.5 million at AMCNI related to the termination of distribution in certain international territories, for the six months ended June 30, 2021.

Restructuring and other related charges of $3.5 million and $9.5 million for the three and six months ended June 30, 2020, respectively, related to restructuring costs associated with termination of distribution in certain territories as well as severance and other personnel related costs associated with previously announced restructuring activities.

The following table summarizes the restructuring and other related charges recognized by operating segment:


(In thousands)	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Domestic Operations	$	216	$	1,204	$	2,643	$	2,686
International & Other	(17)		2,262		4,473		6,239
Corporate / Inter-segment eliminations	(44)		41		1,664		548
Total restructuring and other related charges	$	155	$	3,507	$	8,780	$	9,473

AMC NETWORKS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(unaudited)

The following table summarizes the accrued restructuring costs:


(In thousands)	Severance and employee-related costs		Other exit costs		Total
December 31, 2020	$	25,571	$	31	$	25,602
Charges	4,323		4,457		8,780
Cash payments	(26,398)		—		(26,398)
Non-cash adjustments	—		(4,457)		(4,457)
Other	64		—		64

Balance, June 30, 2021	$	3,560	$	31	$	3,591

Accrued restructuring costs of $3.6 million are included in accrued liabilities in the condensed consolidated balance sheet at June 30, 2021.

Note 6. Program Rights

Total capitalized produced and licensed content by predominant monetization strategy is as follows:

June 30, 2021

(In thousands)

Predominantly Monetized Individually

Predominantly Monetized as a Group

Total

Owned original program rights, net:

Completed

280,754