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What changed in INNOVATE Corp.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of INNOVATE Corp.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+545 added−460 removedSource: 10-K (2024-03-06) vs 10-K (2023-03-14)

Top changes in INNOVATE Corp.'s 2023 10-K

545 paragraphs added · 460 removed · 333 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

91 edited+10 added−15 removed103 unchanged
Biggest changeMyers - Naples, FL 50 WGPS-LD LPTV Station Oklahoma City, OK 52 KOHC-CD Class A Station KBZC-LD LPTV Station KTOU-LD LPTV Station Albuquerque - Santa Fe, NM 53 KQDF-LD LPTV Station KWPL-LD LPTV Station New Orleans, LA 55 WTNO-LP Class A Station WQDT-LD LPTV Station Memphis, TN 56 W15EA-D Class A Station KPMF-LD LPTV Station WPED-LD LPTV Station WQEK-LD LPTV Station WQEO-LD LPTV Station Richmond - Petersburg, VA 57 WFWG-LD LPTV Station WUDW-LD LPTV Station WWBK-LD LPTV Station Mobile, AL - Pensacola, FL 60 WEDS-LD LPTV Station WWBH-LD LPTV Station Fresno - Visalia, CA 61 K17JI-D Class A Station KZMM-CD Class A Station Little Rock - Pine Bluff, AR 63 K23OW-D LPTV Station KENH-LD LPTV Station KWMO-LD LPTV Station Flint - Saginaw - Bay City, MI 64 W35DQ-D LPTV Station WFFC-LD LPTV Station Tulsa, OK 66 KUOC-LD LPTV Station KZLL-LD LPTV Station Rochester, NY 69 WGCE-CD Class A Station Charleston - Huntington, WV 73 WOCW-LD LPTV Station Madison, WI 75 W23BW-D Class A Station WZCK-LD LPTV Station Chattanooga, TN 78 WYHB-CD Class A Station Wichita - Hutchinson, KS 79 KFVT-LD LPTV Station Myrtle Beach - Florence, SC 80 W33DN-D LPTV Station Springfield, MO 82 KCNH-LD LPTV Station KFKY-LD LPTV Station Omaha, NE 83 KAJS-LD LPTV Station KQMK-LD LPTV Station Harlingen - Weslaco - Brownsville - McAllen, TX 84 KRZG-CD Class A Station KAZH-LP LPTV Station KNWS-LD LPTV Station Des Moines - Ames, IA 85 KAJR-LD LPTV Station KCYM-LD LPTV Station KRPG-LD LPTV Station Huntsville - Decatur - Florence, AL 86 W34EY-D Class A Station Savannah, GA 87 WDID-LD LPTV Station WUET-LD LPTV Station Waco - Temple - Bryan, TX 88 KAXW-LD LPTV Station KZCZ-LD LPTV Station 14 Champaign - Springfield - Decatur, IL 90 W23EW-D LPTV Station WCQA-LD LPTV Station WEAE-LD LPTV Station Charleston, SC 91 WBSE-LD LPTV Station Traverse City - Cadillac, MI 92 W36FH-D LPTV Station Baton Rouge, LA 93 K27NB-D LPTV Station K29LR-D LPTV Station Greenville - New Bern - Washington, NC 94 W35DW-D LPTV Station Paducah, KY - Cape Girardeau, MO - Harrisburg, IL 95 W29CI-D Class A Station Shreveport, LA 96 K36MU-D LPTV Station South Bend - Elkhart, IN 98 KPDS-LD LPTV Station Cedar Rapids - Waterloo - Iowa City, IA 100 K17MH-D LPTV Station KFKZ-LD LPTV Station Reno, NV 101 K07AAI-D LPTV Station Ft.
Biggest changeMyers - Naples, FL 55 WGPS-LD LPTV Station Richmond - Petersburg, VA 56 WUDW-LD LPTV Station WWBK-LD LPTV Station WFWG-LD LPTV Station Mobile, AL - Pensacola, FL 57 WWBH-LD LPTV Station WEDS-LD LPTV Station Little Rock - Pine Bluff, AR 59 KWMO-LD LPTV Station K23OW-D LPTV Station KENH-LD LPTV Station Tulsa, OK 62 KZLL-LD LPTV Station KUOC-LD LPTV Station Des Moines - Ames, IA 67 KRPG-LD LPTV Station KAJR-LD LPTV Station KCYM-LD LPTV Station Omaha, NE 71 KQMK-LD LPTV Station KAJS-LD LPTV Station Wichita - Hutchinson, KS 72 KFVT-LD LPTV Station Springfield, MO 73 KFKY-LD LPTV Station KCNH-LD LPTV Station Flint - Saginaw - Bay City, MI 74 WFFC-LD LPTV Station W35DQ-D LPTV Station Rochester, NY 76 WGCE-CD Class A Station Madison, WI 77 W23BW-D Class A Station WZCK-LD LPTV Station 14 Charleston - Huntington, WV 79 WOCW-LD LPTV Station Huntsville - Decatur - Florence, AL 81 W34EY-D Class A Station Harlingen - Weslaco - Brownsville - McAllen, TX 82 KNWS-LD LPTV Station KRZG-CD Class A Station KAZH-LD LPTV Station Waco - Temple - Bryan, TX 83 KZCZ-LD LPTV Station KAXW-LD LPTV Station Chattanooga, TN 84 WYHB-CD Class A Station Savannah, GA 85 WDID-LD LPTV Station WUET-LD LPTV Station Charleston, SC 88 WBSE-LD LPTV Station Paducah, KY - Cape Girardeau, MO - Harrisburg, IL 90 W29CI-D Class A Station Champaign - Springfield - Decatur, IL 91 WCQA-LD LPTV Station WEAE-LD LPTV Station W23EW-D LPTV Station Shreveport, LA 92 K36MU-D LPTV Station Cedar Rapids - Waterloo - Iowa City, IA 94 KFKZ-LD LPTV Station K17MH-D LPTV Station Baton Rouge, LA 95 K27NB-D LPTV Station K29LR-D LPTV Station Ft.
We have generally pursued either controlling positions in durable, cash-flow generating businesses, assets that will enhance our current businesses in Infrastructure, Life Sciences and Spectrum or companies we believe exhibit substantial growth potential, which may be unrelated to the Company’s then-current operating segments.
We have generally pursued either controlling positions in durable, cash-flow generating businesses and assets that will enhance our current businesses in Infrastructure, Life Sciences and Spectrum or companies we believe exhibit substantial growth potential, which may be unrelated to the Company’s then-current operating segments.
We are required to adhere to applicable regulations detailed in FDA’s current Good Manufacturing Practices ("cGMP") as set forth in the Quality System Regulation, which include among other things, testing, control and documentation requirements.
We are required to adhere to applicable regulations detailed in the FDA’s current Good Manufacturing Practices ("cGMP") as set forth in the Quality System Regulation, which include among other things, testing, control and documentation requirements.
The information on our website is not a part of this Annual Report on Form 10-K. Our reports filed with the SEC may be accessed at the SEC’s website at www.sec.gov. The information required by this item relating to our executive officers, directors and code of conduct is set forth in Item 10.
The information on our website is not a part of this Annual Report on Form 10-K. Our reports filed with the SEC may be accessed at the SEC’s website at www.sec.gov. The information required by this item relating to our executive officers, directors and code of conduct is set forth in Item 10 of this Form 10-K.
Both of these tools allow clients to accurately plan and budget for any upcoming project; • Fabrication: Through its five fabrication shops in Florida, New Jersey, South Carolina and Virginia, Banker Steel has maximum annual fabrication capacity of approximately 189,000 tons with over 584,000 square feet of space; typically focusing on complex, non-commoditized jobs with intensive fabrication requirements; and • Erection: Banker offers a full suite of erection services including horizontal and vertical erection services.
Both of these tools allow clients to accurately plan and budget for any upcoming project; • Fabrication: Through its five fabrication shops in Florida, New Jersey, South Carolina and Virginia, Banker Steel has maximum annual fabrication capacity of approximately 189,000 tons with approximately 584,000 square feet of space; typically focusing on complex, non-commoditized jobs with intensive fabrication requirements; and • Erection: Banker Steel offers a full suite of erection services including horizontal and vertical erection services.
DBMG pursues this objective with a strategy comprised of the following components: • Pursue Large, Value-Added Design-Build Projects: DBMG’s unique ability to offer design-build services, a full range of steel construction services and project management capabilities makes it a preferred partner for complex, design-build fabrication projects in the geographic regions it serves.
DBMG pursues this objective with a strategy comprised of the following components: • Pursue Large, Value-Added Design-Build Projects: DBMG’s unique ability to offer design-build services, a full range of steel construction services and project management capabilities makes it a preferred partner for complex, design-build construction projects in the geographic regions it serves.
The fees charged can be fixed or variable and the contracts that the Company enters into are generally short-term in nature. Variable fees are usage/sales-based and are recognized as revenue when the subsequent usage occurs. Network advertising revenue is generated primarily from the sale of television airtime for advertisements or paid programming.
The fees charged can be fixed or variable and the contracts that the Company enters into are generally short-term in nature. Variable fees are usage/sales-based and are recognized as revenue when the subsequent usage occurs. 16 Network advertising revenue is generated primarily from the sale of television airtime for advertisements or paid programming.
While we have measures in place to remain compliant, shortfalls in required programming for Full-Power stations and Class A stations may result in financial penalties levied by the FCC or, in worst cases, the loss of license. Federal legislation and FCC rules have changed significantly in recent years and may continue to change.
While we have measures in place to remain compliant, shortfalls in required programming for Full-Power stations and Class A stations may result in financial penalties levied by the FCC or, in worst cases, the loss of license. 17 Federal legislation and FCC rules have changed significantly in recent years and may continue to change.
The Company does not believe that the expiration or non-renewal of any of our FCC licenses would have a material adverse effect on the expected future cash flows and profitability. 17 The FCC can sanction us for programming broadcast on our stations that it finds to be indecent.
The Company does not believe that the expiration or non-renewal of any of our FCC licenses would have a material adverse effect on the expected future cash flows and profitability. The FCC can sanction us for programming broadcast on our stations that it finds to be indecent.
DBMG believes that continuing to diversify its revenue base by completing projects - such as low-rise office buildings, healthcare facilities and other commercial and industrial structures - could reduce the impact of periodic adverse market or economic conditions, as well as the margin slippage that may accompany larger projects; 3 • Emphasize Innovative Services: DBMG focuses its BIM modeling, digital engineering, design-build, engineering, detailing, fabrication, erection, and construction expertise on larger, more complex projects, where it typically experiences less competition and more advantageous negotiated contract opportunities.
DBMG believes that continuing to diversify its revenue base by completing projects - such as low-rise office buildings, healthcare facilities and other commercial and industrial structures - could reduce the impact of periodic adverse market or economic conditions, as well as the margin slippage that may accompany larger projects; 3 • Emphasize Innovative Services : DBMG focuses its building information modeling ("BIM"), digital engineering, design-build, engineering, detailing, fabrication, erection, and construction expertise on larger, more complex projects, where it typically experiences less competition and more advantageous negotiated contract opportunities.
Strategy Broadcasting’s strategy includes the following initiatives: • Broadcasting is principally designed to be a nationwide OTA distribution platform, targeting the growing number of OTA households in the U.S.; • Broadcasting's vision is to capitalize on the opportunities to bring valuable content to more viewers over-the-air and to position itself for the changing media landscape and to take advantage of the technology advances rapidly underway in the industry; • As of December 31, 2022, 245 operating stations are connected to Broadcasting's cloud-based IP backbone and can be operated and monitored remotely, allowing for substantial cost savings and operating efficiencies.
Strategy Broadcasting’s strategy includes the following initiatives: • Broadcasting is principally designed to be a nationwide OTA distribution platform, targeting the growing number of OTA households in the U.S.; • Broadcasting's vision is to capitalize on the opportunities to bring valuable content to more viewers over-the-air and to position itself for the changing media landscape and to take advantage of the technology advances rapidly underway in the industry; • As of December 31, 2023, 245 operating stations are connected to Broadcasting's cloud-based IP backbone and can be operated and monitored remotely, allowing for substantial cost savings and operating efficiencies.
Future annual minimum royalty payment commitments are as follows: $75,000 on the first anniversary, $100,000 on the second anniversary, $150,000 on the third anniversary, and $200,000 on the fourth anniversary of the effective date that occurs following the first commercial sale, and each subsequent anniversary of the effective date thereafter through the term.
Annual minimum royalty payment commitments are as follows: $75,000 on the first anniversary, $100,000 on the second anniversary, $150,000 on the third anniversary, and $200,000 on the fourth anniversary of the effective date that occurs following the first commercial sale, and each subsequent anniversary of the effective date thereafter through the term.
DBMG maintains professional liability insurance in the amount of $10.0 million for professional services related to our work in steel erection and fabrication projects. 7 All policies are subject to various deductibles and coverage limitations.
DBMG maintains professional liability insurance in the amount of $10.0 million for professional services related to our work in steel erection and fabrication projects. All policies are subject to various deductibles and coverage limitations.
Additionally, DBMG can help clients manage steel subcontracts, providing clients with savings on raw steel purchases and giving them access to a variety of DBMG-approved subcontractors; • Fabrication: Through its six fabrication shops in Arizona, California, Kansas, and Utah, SSC has one of the highest fabrication capacities in the United States, with over 1.1 million square feet under roof and a maximum annual fabrication capacity of approximately 287,000 tons; • Erection: Named the top steel erector in the United States for 2007, 2008, 2011, 2013-2020, and 2022, and the second top steel erector for 2021 by Engineering News-Record, SSC knows how to add value to its projects through the safe and efficient erection of steel structures; and • BIM: DBMG uses BIM on every project to manage its role efficiently.
Additionally, SSC can help clients manage steel subcontracts, providing clients with savings on raw steel purchases and giving them access to a variety of SSC-approved subcontractors; • Fabrication: Through its six fabrication shops in Arizona, California, Kansas, and Utah, SSC has one of the highest fabrication capacities in the United States, with approximately 1.1 million square feet under roof and a maximum annual fabrication capacity of approximately 287,000 tons; • Erection: Named the top steel erector in the United States for 2007, 2008, 2011, 2013-2020, and 2022, and the second top steel erector for 2021 and 2023 by Engineering News-Record, SSC knows how to add value to its projects through the safe and efficient erection of steel structures; and • BIM: SSC uses BIM on every project to manage its role efficiently.
As a result, additional programming has, and is expected to further become, available through non-traditional methods, which can directly impact the number of OTA TV viewers, and, thus, indirectly impact station revenues. Government Approvals and Regulation Federal broadcasting industry regulations limit our operating flexibility. The FCC regulates all local television broadcasters, including us.
As a result, additional programming has, and is expected to further become, available through non-traditional methods, which can directly impact the number of OTA TV viewers, and, thus, indirectly impact station revenues. Government Approvals and Regulation Federal broadcasting industry regulations limit our operating flexibility. The Federal Communications Commission ("FCC") regulates all local television broadcasters, including us.
DBM Vircon provides steel detailing, rebar detailing, BIM modeling and BIM management services for industrial and infrastructure and commercial construction projects in Australia, New Zealand, Europe and North America. • Steel Detailing: Utilizing industry leading technologies, DBM Vircon provides steel detailing services which include: shop drawings, erection plans, anchor bolt drawings, connection sketches, DSTV files for cutting and drilling, DXF files for plate work, field bolt lists, specialist reports and advance bill of material and piping; • Rebar Detailing: These services, including rebar detailing and estimating, are delivered by a staff experienced in rebar installation and familiar with the construction practices and constructability issues that arise on project sites.
DBM Vircon provides steel detailing, rebar detailing, BIM modeling and BIM management services for industrial and infrastructure and commercial construction projects in Australia, New Zealand, Europe and North America. 5 • Steel Detailing: Utilizing industry leading technologies, DBM Vircon provides steel detailing services which include: shop drawings, erection plans, anchor bolt drawings, connection sketches, NC files for cutting and drilling, DXF files for plate work, field bolt lists, specialist reports and advance bill of material and piping; • Rebar Detailing: These services, including rebar detailing and estimating, are delivered by a staff experienced in rebar installation and familiar with the construction practices and constructability issues that arise on project sites.
In the last several years, there has been increasing competition from not just cable channels but also streaming services, digital platforms, social media, and internet-delivered video channels. These media platforms have taken market share from “over-the-air” (OTA) broadcast stations like ours. Full Power stations delivering OTA multicast networks also represent direct competition in all our markets.
In the last several years, there has been increasing competition from not just cable channels but also streaming services, digital platforms, social media, and internet-delivered video channels. These media platforms have taken market share from OTA broadcast stations like ours. Full Power stations delivering OTA multicast networks also represent direct competition in all our markets.
As of December 31, 2022, our three operating platforms or reportable segments, based on management’s organization of the enterprise, are Infrastructure, Life Sciences and Spectrum, plus our Other segment, which includes businesses that do not meet the separately reportable segment thresholds. Our principal operating subsidiaries include the following assets: (i) DBM Global Inc.
As of December 31, 2023, our three operating platforms or reportable segments, based on management’s organization of the enterprise, are Infrastructure, Life Sciences and Spectrum, plus our Other segment, which includes businesses that do not meet the separately reportable segment thresholds. Our principal operating subsidiaries include the following assets: (i) DBM Global Inc.
We expect our issued and exclusively licensed patents to expire in 2037 or later. We also rely on trade secrets, technical know-how, contractual arrangements, and continuing innovation to protect our intellectual property and maintain our competitive position. We have a policy to enter into confidentiality agreements with third parties, employees, and consultants.
We expect our issued and exclusively licensed patents to expire in 2035 or later. We also rely on trade secrets, technical know-how, contractual arrangements, and continuing innovation to protect our intellectual property and maintain our competitive position. We have a policy to enter into confidentiality agreements with third parties, employees, and consultants.
Its services including plant maintenance, specialty welding, equipment rigging, and mechanical construction to customers in the power, industrial, petrochemical, water treatment, and refining markets at a national level; • Specialty construction solutions for processing markets: Customers in the pulp and paper, metals, mining and minerals, and petrochemical markets utilize GrayWolf’s specialized solutions including plant maintenance, process piping, equipment, and tank and vessel fabrication and erection that are catered to the needs and specifications of the customer’s industry; • Turnarounds, tank construction, and piping services: GrayWolf offers services including plant maintenance, specialty welding, piping systems, and tanks and vessels construction to the power, pulp and paper, refining, petrochemical, and water treatment markets in the Midwest, Mid-Atlantic, Southeast, and West Coast; • Custom steel fabrication and erection: GrayWolf offers engineering, design, fabrication, modularization, erection and additional services to the heavy commercial and industrial markets in the Southwest, Midwest, Gulf Coast and Southeast; and • Structural steel management: GrayWolf provides turn-key steel fabrication and erection services with expertise in project management.
Its services including modularization, plant maintenance, specialty welding, equipment rigging and setting, and mechanical and electrical construction to customers in the power, industrial, petrochemical, water treatment, and refining markets at a national level; • Specialty construction solutions for processing markets: Customers in the pulp and paper, metals, mining and minerals, oil and gas and petrochemical markets utilize GrayWolf’s specialized solutions including plant maintenance, process piping, equipment setting, and tank and vessel fabrication and erection that are catered to the needs and specifications of the customer’s industry; • Turnarounds, tank construction, and piping services: GrayWolf offers services including plant maintenance, specialty welding, piping systems, and tanks and vessels construction to the power, pulp and paper, refining, petrochemical, and water treatment markets in the Midwest, Mid-Atlantic, Southeast, and West Coast; • Custom steel fabrication and erection: GrayWolf offers engineering, design, fabrication, modularization, erection and additional services to the heavy commercial and industrial markets in the Southwest, Midwest, Gulf Coast and Southeast; and • Structural steel management: GrayWolf provides turn-key steel fabrication and erection services with expertise in project management.
As of December 31, 2022, we have completed all milestones associated with the license agreement with MGH and have made all required license fee and milestone payments to MGH described above. We continue to pay the royalty on net sales as required by the agreement and currently have no additional obligations to MGH resulting from any sublicensing agreement. MediBeacon, Inc.
As of December 31, 2023, we have completed all milestones associated with the license agreement with MGH and have made all required license fee and milestone payments to MGH described above. We continue to pay the royalty on net sales as required by the agreement and currently have no additional obligations to MGH resulting from any sublicensing agreement. MediBeacon, Inc.
Broadcast Operations Broadcasting carries approximately 70 networks on its stations, distributing content across the U.S. Broadcasting provides free OTA programming to television viewing audiences in the communities it serves. The programming Broadcasting distributes includes networks targeting shopping, weather, sports and entertainment programming, as well as religious networks and networks targeting select ethnic groups.
Broadcast Operations Broadcasting carries approximately 63 networks on its stations, distributing content across the U.S. Broadcasting provides free OTA programming to television viewing audiences in the communities it serves. The programming Broadcasting distributes includes networks targeting shopping, weather, sports and entertainment programming, as well as religious networks and networks targeting select ethnic groups.
Louis and the Mayo Clinic, have supported MediBeacon’s research in this area. The first in-human clinical studies were recently completed to study the feasibility of fluorescent tracer agent-based systems to quantify the permeability of the gastrointestinal tract in patients with active Crohn’s disease. 2.
Louis and the Mayo Clinic, have supported MediBeacon’s research in this area. The first in-human clinical studies were completed to study the feasibility of using fluorescent tracer agent-based systems to quantify the permeability of the gastrointestinal tract in patients with active Crohn’s disease. 2.
Certain of the fabrication and erection personnel DBMG employs are represented by various trade unions. DBMG is a party to several separate collective bargaining agreements with these unions in certain of its current operating regions, which expire (if not renewed) at various times in the future. Approximately 22% of DBMG’s employees are covered under various collective bargaining agreements.
Certain of the fabrication and erection personnel DBMG employs are represented by various trade unions. DBMG is a party to several separate collective bargaining agreements with these unions in certain of its current operating regions, which expire (if not renewed) at various times in the future. Approximately 14.1% of DBMG’s employees are covered under various collective bargaining agreements.
As of December 31, 2022, most of DBMG’s collective bargaining agreements are subject to automatic annual or other renewal unless either party elects to terminate the agreement on the scheduled expiration date.
As of December 31, 2023, most of DBMG’s collective bargaining agreements are subject to automatic annual or other renewal unless either party elects to terminate the agreement on the scheduled expiration date.
These changes may affect our ability to conduct our business in ways that we believe would be advantageous and may impact our operating results. New Broadcast TV Technology: ATSC 3.0 In 2017, the FCC approved ATSC 3.0, next generation broadcast standards defining how television signals are broadcast and interpreted.
These changes may affect our ability to conduct our business in ways that we believe would be advantageous and may impact our operating results. New Broadcast TV Technology: ATSC 3.0 In 2017, the FCC approved the Advanced Television Systems Committee's standards, ("ATSC 3.0"), the next generation broadcast standards defining how television signals are broadcast and interpreted.
Our FCC licenses must be renewed every 8 years. The current television license renewal cycle began in 2020, and many of our licenses have been renewed, but others remain pending.
Our FCC licenses must be renewed every eight years. The current television license renewal cycle began in 2020, and many of our licenses have been renewed, but others remain pending.
Information relating to our Audit Committee and Audit Committee Financial Expert will be set forth in our 2023 Proxy Statement under the Caption "Board Committees" and is incorporated herein by reference.
Information relating to our Audit Committee and Audit Committee Financial Expert will be set forth in our 2024 Proxy Statement under the Caption "Board Committees" and is incorporated herein by reference.
Revenues Broadcasting generates broadcast station revenue and network advertising revenue from its operations. Broadcast station revenue is generated primarily from the sale of television airtime in return for a fixed fee or a portion of the related ad sales.
Revenues Broadcasting generates broadcast station revenue and, until the end of 2022, network advertising revenue from its operations. Broadcast station revenue is generated primarily from the sale of television airtime in return for a fixed fee or a portion of the related ad sales.
Because nearly all our stations are LPTV and Class A, they do not have primary channel “must carry” rights and, therefore, have no signal coverage and carriage on multichannel video programming distributor ("MVPD") systems. Our lack of MVPD distribution materially affects our television stations’ competitive position in attracting programmers and viewers.
Because nearly all our stations are LPTV and Class A, they do not have primary channel “must carry” rights and, therefore, have no signal coverage and carriage on MVPD systems. Our lack of MVPD distribution materially affects our television stations’ competitive position in attracting programmers and viewers.
SSC offers a variety of services to its customers which it believes enhances its ability to obtain and successfully complete projects. These services fall into six distinct groups: design-assist/design-build, pre-construction design and budgeting, steel management, fabrication, erection, and BIM: • Design-Assist/Design-Build: Using the latest technology and BIM, DBMG works to provide clients with cost-effective steel designs.
SSC believes that the variety of services it offers to its customers enhances its ability to obtain and successfully complete projects. These services fall into six distinct groups: design-assist/design-build, pre-construction design and budgeting, steel management, fabrication, erection, and BIM: 4 • Design-Assist/Design-Build: Using the latest technology and BIM, SSC works to provide clients with cost-effective steel designs.
Services and Customers DBMG consists of five business units spread across diverse markets: Schuff Steel Company ("SSC") (steel fabrication and erection), Banker Steel (steel fabrication and erection), DBM Vircon (steel detailing, rebar detailing, bridge detailing, BIM modeling services and BIM management services), the Aitken product line (manufacturing of equipment for the oil and gas industry), and GrayWolf (steel fabrication and erection, specialty facility maintenance, repair, and installation services, as well as management of smaller structural steel projects, leveraging subcontractors).
Services and Customers DBMG consists of five business units spread across diverse markets: Schuff Steel Company (steel fabrication and erection), Banker Steel (steel fabrication and erection), DBM Vircon (steel detailing, rebar detailing, bridge detailing, BIM modeling services and BIM management services), the Aitken product line (manufacturing of equipment for the oil and gas industry), and GrayWolf (industrial multi-discipline construction, modularization, steel fabrication and erection, specialty facility maintenance, repair, and installation services, as well as management of smaller structural steel projects, leveraging subcontractors).
Suppliers DBMG currently purchases its steel from a variety of domestic and foreign steel producers but is not dependent on any one producer. During the year ended December 31, 2022, DBMG, through SSC and Banker Steel, purchased approximately 60% of the total value of steel and steel components purchased from two domestic steel vendors.
Suppliers DBMG currently purchases its steel from a variety of domestic and foreign steel producers but is not dependent on any one producer. During the year ended December 31, 2023, DBMG, through SSC and Banker Steel, purchased approximately 34.4% of the total value of steel and steel components purchased from two domestic steel vendors.
Both of these tools allow clients to accurately plan and budget for any upcoming project; • Steel Management: Using DBMG’s proprietary Steel Integrated Management System ("SIMS"), DBMG can track any piece of steel and instantly know its location.
Both of these tools allow clients to accurately plan and budget for any upcoming project; • Steel Management: Using SSC’s proprietary Steel Integrated Management System ("SIMS"), SSC can track any piece of steel and instantly know its location.
The Glacial Rx system is sold to dermatologists and plastic surgeons and operated by trained healthcare professionals. 2. Glacial Spa – Launched in the first half of 2022 in China after receiving China Non-Medical Classification, the Glacial Spa is a cooling experience used to even skin tone, and brighten and lighten skin.
The Glacial Rx system is sold into medical practices and is operated by trained healthcare professionals. 2. Glacial Spa – Launched in the first half of 2022 in China after receiving China Non-Medical Classification, the Glacial Spa is a cooling experience used to even skin tone, and brighten and lighten skin.
The end result is turnkey-ready, structural steel solutions for its diverse client base; 4 • Pre-Construction Design and Budgeting: Clients who contact DBMG in the early stages of planning can receive a DBMG-performed analysis of the structure and cost breakdown.
The end result is turnkey-ready, structural steel solutions for its diverse client base; • Pre-Construction Design and Budgeting: Clients who contact SSC in the early stages of planning can receive an SSC-performed analysis of the structure and cost breakdown.
Surgical visualization feasibility, which has the potential to be used in open, laparoscopic and robotic surgeries to identify critical structures, tumor margins and blood flow in tissues in real-time. Clinical research in this area is still underway. Genovel Orthopedics, Inc.
Surgical visualization feasibility, which has the potential to be used in open, laparoscopic and robotic surgeries to identify critical structures (e.g. ureters), tumor margins and blood flow in tissues in real-time. Research in this area is underway. Genovel Orthopedics, Inc.
Broadcasting’s stations are interconnected to an internet protocol network backbone, which allows Broadcasting to monitor and operate the stations remotely, resulting in significant cost efficiencies. As of December 31, 2022, Broadcasting operated 251 stations, including 3 Full-Power stations, 53 Class A stations and 195 LPTV stations.
Broadcasting’s stations are interconnected to an internet protocol network backbone, which allows Broadcasting to monitor and operate the stations remotely, resulting in significant cost efficiencies. As of December 31, 2023, Broadcasting operated 251 stations, including three Full-Power stations, 53 Class A stations and 195 Low Power Television ("LPTV") stations.
In addition, R2 will pay a milestone payment of $1,000,000 within sixty days of the earliest: (i) first commercial sale, (ii) first regulatory approval allowing Sale or marketing of a product or process in any country, (iii) the first marketing of a product or process in any country.
In addition, the agreement provides for R2 to pay a milestone payment of $1,000,000 within sixty days of the earliest: (i) first commercial sale, (ii) first regulatory approval allowing sale or marketing of a product or process in any country, (iii) the first marketing of a product or process in any country.
Employees As of December 31, 2022, we had 3,565 full-time employees and 196 part-time employees, including the employees of our operating businesses as described in more detail below. We consider our relations with our employees to be satisfactory. Our Operating Subsidiaries Infrastructure Segment (DBMG) DBM Global Inc.
Employees As of December 31, 2023, we had 3,946 full-time employees and 78 part-time employees, including the employees of our operating businesses as described in more detail below. We consider our relations with our employees to be satisfactory. Our Operating Subsidiaries Infrastructure Segment (DBMG) DBM Global Inc.
GrayWolf provides services including steel fabrication, steel management, maintenance, repair, erection, and installation to a diverse range of end markets in order to provide high-quality outage, turnaround, and new installation services to customers.
GrayWolf provides services including industrial multi-discipline construction, modularization, steel fabrication, steel construction management, maintenance, repair, erection, and installation to a diverse range of end markets in order to provide high-quality outage, turnaround, and new installation services to customers.
Lauderdale, FL 18 W16CC-D LPTV Station Cleveland - Akron - Canton, OH 19 KONV-LD LPTV Station WEKA-LD LPTV Station WQDI-LD LPTV Station WUEK-LD LPTV Station 12 KBTV-CD Class A Station Sacramento - Stockton - Modesto, CA 20 K04QR-D LPTV Station K12XJ-D LPTV Station KAHC-LD LPTV Station KBIS-LD LPTV Station KFKK-LD LPTV Station KFMS-LD LPTV Station KFTY-LD LPTV Station Charlotte, NC 21 W15EB-D Class A Station WHEH-LD LPTV Station WVEB-LD LPTV Station Pittsburgh, PA 22 WJMB-CD Class A Station WKHU-CD Class A Station WMVH-CD Class A Station WWKH-CD Class A Station WWLM-CD Class A Station Raleigh - Durham - Fayetteville, NC 23 WIRP-LD LPTV Station WNCB-LD LPTV Station Portland, OR 24 KOXI-CD Class A Station St.
Lauderdale, FL 18 W16CC-D LPTV Station Cleveland - Akron - Canton, OH 19 WQDI-LD LPTV Station WUEK-LD LPTV Station WEKA-LD LPTV Station KONV-LD LPTV Station Sacramento - Stockton - Modesto, CA 20 KBIS-LD LPTV Station K04QR-D LPTV Station KFTY-LD LPTV Station KBTV-CD Class A Station KFKK-LD LPTV Station KAHC-LD LPTV Station KFMS-LD LPTV Station K12XJ-D LPTV Station Charlotte, NC 21 WVEB-LD LPTV Station W15EB-D Class A Station WHEH-LD LPTV Station Raleigh - Durham - Fayetteville, NC 22 WNCB-LD LPTV Station WIRP-LD LPTV Station Portland, OR 23 KOXI-CD Class A Station St.
Worth, TX 7 K07AAD-D LPTV Station KHPK-LD LPTV Station KJJM-LD LPTV Station KNAV-LD LPTV Station KODF-LD LPTV Station KPFW-LD LPTV Station KQRO-LD LPTV Station San Francisco - Oakland - San Jose, CA 8 KEMO-TV Full-Power Station Atlanta, GA 9 WYGA-CD Class A Station WDWW-LD LPTV Station WUEO-LD LPTV Station WUVM-LD LPTV Station KUGB-CD Class A Station KUVM-CD Class A Station Houston, TX 10 KBMN-LD LPTV Station KEHO-LD LPTV Station KUVM-LD LPTV Station Tampa - St Petersburg - Sarasota, FL 11 WXAX-CD Class A Station W16DQ-D LPTV Station W31EG-D LPTV Station WTAM-LD LPTV Station Seattle, WA 12 KUSE-LD LPTV Station Detroit, MI 13 WDWO-CD Class A Station WUDL-LD LPTV Station Phoenix - Prescott, AZ 14 KPDF-CD Class A Station K12XP-D LPTV Station KTVP-LD LPTV Station Orlando - Daytona Beach - Melbourne, FL 15 WATV-LD LPTV Station WFEF-LD LPTV Station Minneapolis - St.
Worth, TX 5 KHPK-LD LPTV Station KPFW-LD LPTV Station KNAV-LD LPTV Station KODF-LD LPTV Station K07AAD-D LPTV Station KJJM-LD LPTV Station Houston, TX 6 KUVM-LD LPTV Station KUGB-CD Class A Station KUVM-CD Class A Station KBMN-LD LPTV Station KEHO-LD LPTV Station Atlanta, GA 7 WYGA-CD Class A Station WUVM-LD LPTV Station WDWW-LD LPTV Station WUEO-LD LPTV Station Boston, MA 8 WLEK-LD LPTV Station San Francisco - Oakland - San Jose, CA 10 KQRO-LD LPTV Station KEMO-TV Full Power Station Phoenix - Prescott, AZ 11 K12XP-D LPTV Station KTVP-LD LPTV Station KPDF-CD Class A Station Tampa - St Petersburg - Sarasota, FL 12 W31EG-D LPTV Station W16DQ-D LPTV Station WXAX-CD Class A Station WTAM-LD LPTV Station Seattle, WA 13 KUSE-LD LPTV Station Detroit, MI 14 WDWO-CD Class A Station WUDL-LD LPTV Station Minneapolis - St.
DBMG offers a range of services across a broad geography through its fifteen fabrication shops in the United States and thirty-six sales and management facilities located in the United States, Australia, Canada, India, New Zealand, the Philippines, Thailand and the UK.
DBMG offers a range of services across a broad geography through its 14 fabrication shops in the United States and 32 sales and management facilities located in the United States, Australia, Canada, India, New Zealand, the Philippines, and the UK.
Louis, MO 25 K25NG-D Class A Station KBGU-LD LPTV Station KPTN-LD LPTV Station W09DL-D LPTV Station WLEH-LD LPTV Station WODK-LD LPTV Station Baltimore, MD 26 WQAW-LD LPTV Station Nashville, TN 27 WCTZ-LD LPTV Station WKUW-LD LPTV Station Hartford - New Haven, CT 28 WRNT-LD LPTV Station WTXX-LD LPTV Station Indianapolis, IN 29 WQDE-LD LPTV Station WSDI-LD LPTV Station WUDZ-LD LPTV Station San Diego, CA 30 KSKT-CD Class A Station Columbus, OH 31 WDEM-CD Class A Station Salt Lake City, UT 33 KBTU-LD LPTV Station San Antonio, TX 35 KVDF-CD Class A Station K17MJ-D LPTV Station K25OB-D Class A Station KISA-LD LPTV Station KOBS-LD LPTV Station KSAA-LP LPTV Station KSSJ-LD LPTV Station Kansas City, MO 36 KAJF-LD LPTV Station KCMN-LD LPTV Station KQML-LD LPTV Station Milwaukee, WI 37 WTSJ-LD LPTV Station Austin, TX 39 KGBS-CD Class A Station KVAT-LD LPTV Station West Palm Beach - Ft.
Louis, MO 24 KPTN-LD LPTV Station K25NG-D Class A Station KBGU-LD LPTV Station W09DL-D LPTV Station WODK-LD LPTV Station WLEH-LD LPTV Station Indianapolis, IN 25 WUDZ-LD LPTV Station WSDI-LD LPTV Station WQDE-LD LPTV Station Nashville, TN 26 WCTZ-LD LPTV Station WKUW-LD LPTV Station Salt Lake City, UT 27 KBTU-LD LPTV Station Pittsburgh, PA 28 WJMB-CD Class A Station WWLM-CD Class A Station WMVH-CD Class A Station WKHU-CD Class A Station WWKH-CD Class A Station Baltimore, MD 29 WQAW-LD LPTV Station San Diego, CA 30 KSKT-CD Class A Station San Antonio, TX 31 K17MJ-D LPTV Station KOBS-LD LPTV Station K25OB-D Class A Station KSAA-LD LPTV Station KVDF-CD Class A Station KISA-LD LPTV Station KSSJ-LD LPTV Station Hartford - New Haven, CT 32 WTXX-LD LPTV Station WRNT-LD LPTV Station Columbus, OH 33 WDEM-CD Class A Station Kansas City, MO 34 KAJF-LD LPTV Station KCMN-LD LPTV Station KQML-LD LPTV Station 13 Austin, TX 35 KGBS-CD Class A Station KVAT-LD LPTV Station Milwaukee, WI 38 WTSJ-LD LPTV Station West Palm Beach - Ft.
In 2022, DBMG's two largest customers represented approximately 28.7% of revenues. In 2021, DBMG’s two largest customers represented approximately 23.4% of revenues. DBMG’s size gives it the production capacity to complete large-scale, demanding projects, with typical utilization per facility ranging from 90% - 96% and a sales pipeline that includes over $4.6 billion in potential revenue generation.
In 2023, DBMG's two largest customers represented approximately 41.3% of DBMG's revenues. In 2022, DBMG’s two largest customers represented approximately 28.7% of DBMG's revenues. DBMG’s size gives it the production capacity to complete large-scale, demanding projects, with typical utilization per facility ranging from 96% - 100% and a sales pipeline that includes approximately $6.6 billion in potential revenue generation.
Wayne, IN 114 WFWC-CD Class A Station W25FH-D LPTV Station W30EH-D LPTV Station WCUH-LD LPTV Station WODP-LD LPTV Station Montgomery - Selma, AL 116 WDSF-LD LPTV Station WQAP-LD LPTV Station Tyler - Longview- Nacogdoches, TX 118 KBJE-LD LPTV Station KDKJ-LD LPTV Station KKPD-LD LPTV Station KPKN-LD LPTV Station KCEB Full-Power Station KORY-CD Class A Station Eugene, OR 119 K06QR-D LPTV Station Fargo - Valley City, ND 120 K15MR-D LPTV Station K31FD-D Class A Station Boise, ID 121 K17ED-D Class A Station KBKI-LD LPTV Station KFLL-LD LPTV Station Santa Barbara - San Luis Obispo, CA 122 KDFS-CD Class A Station KLDF-CD Class A Station KQMM-CD Class A Station KSBO-CD Class A Station KVMM-CD Class A Station KZDF-LD LPTV Station Yakima - Pasco - Richland - Kennewick, WA 123 K33EJ-D Class A Station K28QK-D LPTV Station Macon, GA 124 W28EU-D LPTV Station WJDO-LD LPTV Station Peoria - Bloomington, IL 125 W27EQ-D LPTV Station Bakersfield, CA 126 KTLD-CD Class A Station KXBF-LD LPTV Station Columbus, GA - Opelika - Auburn, AL 128 W29FD-D LPTV Station W31EU-D LPTV Station 15 Lafayette, LA 129 K21OM-D LPTV Station La Crosse - Eau Claire, WI 130 W23FC-D LPTV Station Corpus Christi, TX 132 K21OC-D LPTV Station K32OC-D LPTV Station KCCX-LD LPTV Station KYDF-LD LPTV Station Palm Springs, CA 133 K21DO-D Class A Station Bangor, ME 139 W32FS-D LPTV Station W20ER-D LPTV Station Amarillo, TX 140 KAUO-LD LPTV Station KLKW-LD LPTV Station K35OY-D LPTV Station Lubbock, TX 146 K32OV-D LPTV Station KNKC-LD LPTV Station Topeka, KS 147 K35KX-D LPTV Station Joplin, MO - Pittsburg, KS 157 KPJO-LD LPTV Station KRLJ-LD LPTV Station Biloxi-Gulfport, MS 166 W33EG-D LPTV Station Jackson, TN 173 WYJJ-LD LPTV Station Quincy, IL - Hannibal, MO - Keokuk, IA 177 WVDM-LD LPTV Station K14SU-D LPTV Station Bowling Green, KY 184 WCZU-LD LPTV Station WKUT-LD LPTV Station Puerto Rico NA WQQZ-CD Class A Station W20EJ-D LPTV Station W27DZ-D LPTV Station WWKQ-LD LPTV Station WOST Full-Power Station (a) Rankings are based on the relative size of a station’s Designated Market Area ("DMA") among the 210 generally recognized DMAs in the United States.
Wayne, IN 108 WCUH-LD LPTV Station W30EH-D LPTV Station W25FH-D LPTV Station WFWC-CD Class A Station WODP-LD LPTV Station Tyler - Longview- Nacogdoches, TX 109 KDKJ-LD LPTV Station KCEB Full Power Station KBJE-LD LPTV Station KKPD-LD LPTV Station KPKN-LD LPTV Station Augusta, GA - Aiken, SC 110 WIEF-LD LPTV Station Fargo - Valley City, ND 114 K15MR-D LPTV Station Yakima - Pasco - Richland - Kennewick, WA 116 K33EJ-D Class A Station K28QK-D LPTV Station Traverse City - Cadillac, MI 118 W36FH-D LPTV Station Eugene, OR 119 KORY-CD Class A Station K06QR-D LPTV Station Macon, GA 120 W28EU-D LPTV Station WJDO-LD LPTV Station Montgomery - Selma, AL 121 WDSF-LD LPTV Station WQAP-LD LPTV Station Santa Barbara - San Luis Obispo, CA 122 KLDF-CD Class A Station 15 KQMM-CD Class A Station KDFS-CD Class A Station KVMM-CD Class A Station KSBO-CD Class A Station KZDF-LD LPTV Station Peoria - Bloomington, IL 123 W27EQ-D LPTV Station Bakersfield, CA 124 KXBF-LD LPTV Station KTLD-CD Class A Station Lafayette, LA 125 K21OM-D LPTV Station Columbus, GA - Opelika - Auburn, AL 126 W29FD-D LPTV Station W31EU-D LPTV Station Wilmington, NC 128 WQDH-LD LPTV Station La Crosse - Eau Claire, WI 129 W23FC-D LPTV Station Corpus Christi, TX 130 K21OC-D LPTV Station KCCX-LD LPTV Station K32OC-D LPTV Station KYDF-LD LPTV Station Amarillo, TX 131 KAUO-LD LPTV Station KLKW-LD LPTV Station Columbia - Jefferson City, MO 136 K35OY-D LPTV Station Topeka, KS 140 K35KX-D LPTV Station Lubbock, TX 141 K32OV-D LPTV Station KNKC-LD LPTV Station Palm Springs, CA 143 K21DO-D Class A Station Joplin, MO - Pittsburg, KS 151 KRLJ-LD LPTV Station KPJO-LD LPTV Station Bangor, ME 156 W32FS-D LPTV Station W20ER-D LPTV Station Biloxi-Gulfport, MS 157 W33EG-D LPTV Station Jackson, TN 175 WYJJ-LD LPTV Station Quincy, IL - Hannibal, MO - Keokuk, IA 176 WVDM-LD LPTV Station K14SU-D LPTV Station Bowling Green, KY 180 WKUT-LD LPTV Station WCZU-LD LPTV Station Puerto Rico NA WWKQ-LD LPTV Station NA WOST Full Power Station NA W20EJ-D LPTV Station NA W27DZ-D LPTV Station NA WQQZ-CD Class A Station (a) Rankings are based on the relative size of a station’s Designated Market Area ("DMA") among the 210 generally recognized DMAs in the United States.
Although DBMG has not incurred any material environmental related liability in the past and believes that it is in material compliance with environmental laws, there can be no assurance that DBMG, or entities for which it may be responsible, will not incur such liability in connection with the investigation and remediation of facilities it currently operates (or formerly owned or operated) or other locations in a manner that could materially and adversely affect its operations.
Although DBMG has not incurred any material environmental related liability in the past and believes that it is in material compliance with environmental laws, there can be no assurance that DBMG, or entities for which it may be responsible, will not incur such liability in connection with the investigation and remediation of facilities it currently operates (or formerly owned or operated) or other locations in a manner that could materially and adversely affect its operations. 7 DBMG maintains commercial general liability insurance in the amount of $2.0 million per occurrence and $4.0 million in the aggregate.
In 2020, Huadong amended their agreements to provide for Huadong to prepay $20 million of future China royalties to fund registration of the TGFR system as a Class 1 device in China, allowing it to immediately enter the Chinese hospital system. As of December 31, 2022, the full $20 million has been received.
In 2020, Huadong amended their agreements to provide for Huadong to prepay, at a minimum, $20 million of future China royalties to fund registration of the TGFR system as a Class 1 device in China, allowing it to immediately enter the Chinese hospital system. As of December 31, 2023, approximately $26.3 million had been received.
DBMG maintains commercial general liability insurance in the amount of $2.0 million per occurrence and $4.0 million in the aggregate. In addition, DBMG maintains umbrella coverage limits of $75.0 million. DBMG also maintains insurance against property damage caused by fire, flood, explosion and similar catastrophic events that may result in physical damage or destruction of its facilities and property.
In addition, DBMG maintains umbrella coverage limits of $75.0 million. DBMG also maintains insurance against property damage caused by fire, flood, explosion and similar catastrophic events that may result in physical damage or destruction of its facilities and property.
Employees As of December 31, 2022, DBMG employed 3,489 full-time and 186 part-time people across the globe, including the U.S., Canada, Australia, New Zealand, India, the Philippines, Thailand, and the UK. The number of persons DBMG employs on an hourly basis fluctuates directly in relation to the amount of business DBMG performs.
Employees As of December 31, 2023, DBMG employed 3,884 full-time and 73 part-time (1,033 salaried and 2,924 hourly) people across the globe, including the U.S., Canada, Australia, New Zealand, India, the Philippines, the UK and Mexico. The number of persons DBMG employs on an hourly basis fluctuates directly in relation to the amount of business DBMG performs.
New network content is now in place on those stations formerly carrying Azteca. 11 Operating Broadcast Stations Below are Broadcasting’s operating stations as of December 31, 2022, listed by call sign and market rank: Market Market Rank (a) Station Service New York, NY 1 W02CY-D LPTV Station WKOB-LD LPTV Station Los Angeles, CA 2 KSKJ-CD Class A Station KHIZ-LD LPTV Station Philadelphia, PA 3 WPSJ-CD Class A Station W25FG-D LPTV Station WDUM-LD LPTV Station WZPA-LD LPTV Station WPVN-CD Class A Station Chicago, IL 4 W31EZ-D LPTV Station Boston, MA 5 WLEK-LD LPTV Station Dallas - Ft.
Operating Broadcast Stations Below are Broadcasting’s operating stations as of December 31, 2023, listed by call sign and market rank: Market Market Rank (a) Station Service New York, NY 1 WKOB-LD LPTV Station W02CY-D LPTV Station Los Angeles, CA 2 KHIZ-LD LPTV Station KSKJ-CD Class A Station Chicago, IL 3 WPVN-CD Class A Station W31EZ-D LPTV Station Philadelphia, PA 4 WDUM-LD LPTV Station WZPA-LD LPTV Station W25FG-D LPTV Station WPSJ-CD Class A Station Dallas - Ft.
Pansend also invests in other early stage or developmental stage healthcare companies including an approximately 47.2% interest in MediBeacon Inc. ("MediBeacon"), and an approximately 25.8% interest in Triple Ring Technologies, Inc. ("Triple Ring"). R2 Technologies, Inc. R2 develops and commercializes breakthrough aesthetic medical and non-medical devices in the aesthetic dermatology market.
Pansend also invests in other early stage or developmental stage healthcare companies including an approximate 46.2% interest in MediBeacon Inc. ("MediBeacon"), an approximate 1.9% interest in Triple Ring Technologies, Inc. ("Triple Ring"), and an approximate 20.1% interest in Scaled Cell Solutions, Inc. R2 Technologies, Inc. R2 develops and commercializes breakthrough aesthetic medical and non-medical devices in the aesthetic dermatology market.
Spectrum Segment (HC2 Broadcasting Holdings Inc.) HC2 Broadcasting Holdings Inc., ("HC2B" and together with its subsidiaries, "Broadcasting"), a majority-owned subsidiary of INNOVATE, is an owner and operator of broadcast TV stations throughout the U.S. and an avenue for high-end content providers to deliver their product OTA to more homes and, ultimately, mobile devices.
Scaled Cell Solutions, Inc. is an immunotherapy company developing a novel autologous cell therapy system to potentially improve current CAR-T treatments. 11 Spectrum Segment (HC2 Broadcasting Holdings Inc.) HC2 Broadcasting Holdings Inc., ("HC2B" and together with its subsidiaries, "Broadcasting"), a majority-owned subsidiary of INNOVATE, is an owner and operator of broadcast TV stations throughout the U.S. and an avenue for high-end content providers to deliver their product OTA to more homes and, ultimately, mobile devices.
GrayWolf provides the following services through its two major brands: GrayWolf Integrated Construction (formerly Titan Contracting, Titan Fabricators, and Inco Services), and Milco National Constructors. 5 • Specialty mechanical contracting services: GrayWolf offers specialty mechanical contracting services to the power, petrochemical, refining and other industrial markets.
GrayWolf provides the following services through its two major brands: GrayWolf Integrated Construction (formerly Titan Contracting, Titan Fabricators, and Inco Services), and Milco National Constructors. • Multi-discipline construction and modularization services: GrayWolf offers multi-discipline construction services to manufacturing, power, petrochemical, refining, data center, oil and gas and other industrial markets.
MediBeacon was the recipient of a Small Business Innovation Research grant supported by the National Eye Institute of the National Institutes of Health (NIH). With this support, MediBeacon is pursuing research into the use of a MediBeacon fluorescent tracer agent to visualize vasculature in the eye with clinical studies currently underway. 3.
MediBeacon was the recipient of a Small Business Innovation Research grant supported by the National Eye Institute of the National Institutes of Health (NIH). MediBeacon is pursuing research into the use of Lumitrace to visualize vasculature in the eye. 3.
For the year ended December 31, 2022, revenues were as follows (in millions): Revenue % of Total Revenue SSC $ 763.2 47.9 % Banker Steel 564.1 35.4 % GrayWolf 231.4 14.5 % DBM Vircon 28.6 1.8 % Aitken 7.0 0.4 % Total $ 1,594.3 100.0 % The majority of DBMG's business is in North America, but DBM Vircon provides detailing services on five continents, and SSC provides fabricated steel to Canada and other select countries.
For the year ended December 31, 2023, revenues were as follows (in millions): Revenue % of Total Revenue SSC $ 575.5 41.2 % Banker Steel 589.2 42.2 % GrayWolf 189.7 13.6 % DBM Vircon 35.2 2.5 % Aitken 7.6 0.5 % Total $ 1,397.2 100.0 % The majority of DBMG's business is in North America, but DBM Vircon provides detailing services on five continents, and SSC provides fabricated steel to Canada and other select countries.
Food and Drug Administration (“FDA”) clearance for use in dermatologic procedures for the removal of benign lesions of the skin and for use when cooling is intended for the temporary reduction of pain, swelling, inflammation, and hematoma from minor surgical procedures.
Glacial Rx – Launched in the first quarter of 2021 in the United States after receiving U.S. Food and Drug Administration (“FDA”) clearance for use in dermatologic procedures for the removal of benign lesions of the skin and for use when cooling is intended for the temporary reduction of pain, swelling, inflammation, and hematoma from minor surgical procedures.
DBMG operates with minimal bonding requirements, with a current balance of 53.7% of DBMG's backlog (out of a total backlog of $1,782.3 million) as of December 31, 2022, and bonding is reduced as projects are billed rather than upon completion.
DBMG operates with minimal bonding requirements, with a balance of 34.1% of DBMG's total backlog of $1,057.2 million as of December 31, 2023, and bonding is reduced as projects are billed rather than upon completion.
Paul, MN 16 K33LN-D Class A Station K28PQ-D LPTV Station KJNK-LD LPTV Station KMBD-LD LPTV Station KMQV-LD LPTV Station KWJM-LD LPTV Station Denver, CO 17 KRDH-LD LPTV Station Miami - Ft.
Paul, MN 15 KWJM-LD LPTV Station KJNK-LD LPTV Station K33LN-D Class A Station 12 K28PQ-D LPTV Station KMBD-LD LPTV Station KMQV-LD LPTV Station Orlando - Daytona Beach - Melbourne, FL 16 WATV-LD LPTV Station WFEF-LD LPTV Station Denver, CO 17 KRDH-LD LPTV Station Miami - Ft.
Any devices we manufacture or distribute pursuant to clearance or approval by the FDA are subject to pervasive and continuing regulation by the FDA and certain state agencies, including establishment registration and device listing with the FDA.
We have received regulatory approval or are otherwise free to market the Glacial Rx product in numerous international markets. Any devices we manufacture or distribute pursuant to clearance or approval by the FDA are subject to pervasive and continuing regulation by the FDA and certain state agencies, including establishment registration and device listing with the FDA.
Sales and Distribution In North America, R2 utilizes a direct sales force to sell Glacial Rx. As of December 31, 2022, R2 had a North American sales force of 20 employees, and total full-time employees of 46 and part-time employees of 9. In international markets, R2 sells both Glacial Rx and Glacial Spa through distributors.
As of December 31, 2023, R2 had a North American sales force of 18 employees, total full-time employees of 36 and 4 part-time employees. In international markets, R2 sells both Glacial Rx and Glacial Spa through distributors.
MediBeacon is also exploring additional clinical applications of the patented Lumitrace technology, including: 1. Gastrointestinal permeability, which has the potential to transform management of autoimmune and inflammatory diseases, including Crohn’s disease. Grants from the Bill and Melinda Gates Foundation, in collaboration with scientists at Washington University School of Medicine in St.
MediBeacon fluorescent tracer agent-based monitoring systems hold promise in a range of potential medical applications, including: 1. Gastrointestinal permeability, which has the potential to transform management of autoimmune and inflammatory diseases, including Crohn’s disease. Grants from the Bill and Melinda Gates Foundation, in collaboration with scientists at Washington University School of Medicine in St.
Local advertising revenue is generated from local merchants and service providers. National and local advertising spots are generally sold without guaranteed ratings, and revenue is recognized when spots are aired. 16 Network distribution revenue consists of fees charged and payments received from cable, satellite and other multiple video program distribution (“MVPD”) systems for their retransmission of our network content.
Network advertising revenue is recognized when advertising spots are aired, and as impression guarantees, if any, are achieved. Network distribution revenue consists of fees charged and payments received from cable, satellite and other multiple video program distribution (“MVPD”) systems for their retransmission of our network content.
In connection with a staggered $30 million investment by Huadong, R2 entered into a distribution agreement with Huadong under which R2 granted Huadong all of R2's products in the Asia-Pacific region, and R2 is entitled to receive a share of Huadong's profits from such sales. As of December 31, 2022, R2 has received the entire $30 million investment from Huadong.
In connection with a $30 million investment to be made by Huadong in installments based on pre-determined milestones, R2 entered into a distribution agreement with Huadong under which R2 granted Huadong exclusive rights to distribute all of R2's products in the Asia-Pacific region, and R2 is entitled to receive a share of Huadong's net sales from such products.
DBMG generates future project reports to track the weekly progress of new opportunities. DBMG’s sales efforts are further supported by most of its executive officers, engineering, and strategic sales and marketing personnel, who have substantial experience in the design, detailing, modeling, fabrication, industrial construction, maintenance, and erection of structural steel and heavy steel plate.
DBMG’s sales efforts are further supported by most of its executive officers, engineering, and strategic sales and marketing personnel, who have substantial experience in the design, detailing, modeling, fabrication, industrial construction, maintenance, and erection of structural steel and heavy steel plate. 6 DBMG competes for new project opportunities through its relationships and interaction with its active and prospective customer base which provides valuable current market information and sales opportunities.
With the shut-down of the Azteca America network on December 31, 2022, Broadcast revenues will be driven principally by channel leases and revenue share agreements with some 70 other networks carried on Broadcasting's stations.
Network distribution fees received from MVPDs are recognized as revenue in the period that services are provided. With the shut-down of the Azteca America network on December 31, 2022, Broadcast revenues in 2023 are now principally driven by channel leases and revenue share agreements with some 63 other networks carried on Broadcasting's stations.
The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability, including substantial monetary penalties and criminal prosecution.
The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability, including substantial monetary penalties and criminal prosecution. 9 The regulatory review process for medical devices varies from country to country, and many countries also impose product standards, packaging requirements, environmental requirements, labeling requirements and import restrictions on devices.
In addition, DBMG is often contacted by governmental agencies in connection with public construction projects, and by large private-sector project owners, general contractors and engineering firms in connection with new building projects such as manufacturing and industrial plants, data centers, warehouse and distribution centers, and other industrial and commercial facilities. 6 Upon selection of projects to bid or price, DBMG’s estimating departments review and prepare projected costs of shop, field, detail drawing preparation and crane hours, steel and other raw materials, and other costs.
In addition, DBMG is often contacted by governmental agencies in connection with public construction projects, and by large private-sector project owners, general contractors and engineering firms in connection with new building projects such as manufacturing and industrial plants, data centers, warehouse and distribution centers, and other industrial and commercial facilities.
There are also fewer limitations on the claims our competitors in international markets can make about the effectiveness of their products and the manner in which they can market them. As a result, we face more competition in these markets than in the United States.
Due to less stringent regulatory requirements, there are many more aesthetic products and procedures available for use in international markets than are cleared for use in the United States. There are also fewer limitations on the claims our competitors in international markets can make about the effectiveness of their products and the manner in which they can market them.
Competition The medical technology and aesthetic product markets are highly competitive and dynamic and are characterized by rapid and substantial technological development and product innovations.
Competition The medical technology and aesthetic product markets are highly competitive and dynamic and are characterized by rapid and substantial technological development and product innovations. Demand for our products could be limited by the products and technologies offered now or in the future by our competitors.
Our potential customers also may need to recoup the cost of expensive products that they have already purchased from our competitors, and thus they may decide to delay or not to purchase our products.
Some of our competitors have a broad range of product offerings, large direct sales forces, and long-term customer relationships, which could inhibit our market penetration efforts. Our potential customers also may need to recoup the cost of expensive products that they have already purchased from our competitors, and thus they may decide to delay or not to purchase our products.
We have implemented a patent strategy designed to protect our technology and facilitate commercialization of our current and future products. As of December 31, 2022, our patent portfolio comprised 45 issued patents and 113 pending patent applications, each of which we either own directly or for which we are the exclusive licensee.
As of December 31, 2023, our patent portfolio comprised 115 issued patents and 42 pending patent applications, each of which we either own directly or for which we are the exclusive licensee.
In 2021, Pansend invested $15 million in R2's Series C Preferred Stock at a post-money valuation of $150 million for R2. R2 currently has three products in various stages of commercialization and development: 1. Glacial Rx – Launched in the first quarter of 2021 in the United States after receiving U.S.
R2 received the final installment of the $30 million investment from Huadong on February 3, 2021. In 2021, Pansend invested $15 million in R2's Series C Preferred Stock at a post-money valuation of $150 million for R2. R2 currently has four products in various stages of commercialization and development: 1.
In international markets, we are required to obtain and maintain various quality assurance and quality management certifications. We have obtained the following international certifications: EN ISO 13485:2016 Medical Devices - Quality Management Systems - Requirements for regulatory purposes and Medical Device Single Audit Program (US and Canada).
We have obtained the following international certifications: EN ISO 13485:2016 Medical Devices - Quality Management Systems - Requirements for regulatory purposes and Medical Device Single Audit Program (US and Canada). In November 2023, we were audited by our Certification Body, SGS, and there were no findings or observations.
Broadcasting stations are collectively able to broadcast over 1,500 sub-channels and reach 106 markets in the U.S. and Puerto Rico, including 32 of the top 35 markets. Broadcasting has approximately 95 stations concentrated in the top 35 markets. During the year ended December 31, 2022, Broadcasting included Azteca America. Azteca America aired Spanish language programming targeting U.S. Hispanics.
Broadcasting stations are collectively able to broadcast approximately 1,700 sub-channels and reach 106 markets in the U.S., plus Puerto Rico, including 34 of the top 35 markets. Broadcasting has approximately 100 stations concentrated in the top 35 markets.
However, this subjects us to other risks such as component shortages. We continue to evaluate alternative sources of supply for these components and materials. Patents and Proprietary Technology To establish and protect our proprietary technologies and products, we rely on a combination of patent, copyright, trademark, and trade-secret laws, as well as confidentiality provisions in our contracts.
Patents and Proprietary Technology To establish and protect our proprietary technologies and products, we rely on a combination of patent, copyright, trademark, and trade-secret laws, as well as confidentiality provisions in our contracts. We have implemented a patent strategy designed to protect our technology and facilitate commercialization of our current and future products.
Leveraging such strengths, GrayWolf uses its relationships with reliable subcontractors and erectors, along with state-of-the-art management systems, to deliver excellence to clients. Banker Steel provides full-service fabricated structural steel and erection services primarily for the East Coast and Southeast commercial and industrial construction market in addition to full design-assist services.
Leveraging such strengths, GrayWolf uses its relationships with reliable subcontractors and erectors, along with state-of-the-art management systems, to deliver excellence to clients.
The Glacial Spa system will be sold by Huadong’s existing sales force to spas and is intended to be operated by a trained aesthetician. 3. Glacial AI – Currently undergoing research and development, the Glacial AI is an autonomous, robotic cooling device focused on whole-body skin lightening and brightening.
Glacial AI – Currently undergoing research and development, the Glacial AI is an autonomous, robotic cooling device focused on whole-body skin lightening and brightening. 8 Sales and Distribution In North America, R2 utilizes a direct sales force to sell Glacial Rx and Glacial fx.
MediBeacon’s Transdermal GFR Measurement System (“TGFR”), which uses an optical skin sensor combined with Lumitrace, a proprietary agent that glows in the presence of light, will be the first non-invasive system to enable real-time, direct monitoring of kidney function at point-of-care.
Chronic kidney disease is estimated to affect approximately 850 million people worldwide. 10 MediBeacon’s TGFR uses a highly engineered transdermal skin sensor combined with Lumitrace (relmapirazin), a novel fluorescent tracer agent that glows in the presence of light. The TGFR is designed to be the first system to enable real-time, monitoring of kidney function at the point-of-care.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changePansend faces an inherent risk of product liability as a result of the marketing and sale of its products. For example, Pansend may be sued if its products cause or are perceived to cause injury or are found to be otherwise unsuitable during manufacturing, marketing or sale.
Biggest changeFor example, Pansend may be sued if its products cause or are perceived to cause injury or are found to be otherwise unsuitable during manufacturing, marketing or sale. Any such product liability claim may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, negligence, strict liability or breach of warranty.
Subject to the terms of any applicable covenants in financing arrangements or other agreements we may enter into from time to time, may in the future enter into additional transactions in which such persons have an interest.
Subject to the terms of any applicable covenants in financing arrangements or other agreements, we may from time to time or may in the future enter into additional transactions in which such persons have an interest.
We may issue additional shares of common stock or preferred stock, which could dilute the interests of our stockholders and present other risks. Our certificate of incorporation, as amended (the "Certificate of Incorporation"), authorizes the issuance of up to 160,000,000 shares of common stock and 20,000,000 shares of preferred stock.
We may issue additional shares of common stock or preferred stock, which could dilute the interests of our stockholders and present other risks. Our certificate of incorporation, as amended, authorizes the issuance of up to 160,000,000 shares of common stock and 20,000,000 shares of preferred stock.
Pursuant to a second amended and restated registration rights agreement, dated January 5, 2015, entered into in connection with the issuance of the preferred stock (the "Registration Rights Agreement"), we have granted registration rights to the purchasers of our preferred stock and certain of their transferees with respect to INNOVATE common stock held by them and common stock underlying the preferred stock.
Pursuant to a second amended and restated registration rights agreement, dated January 5, 2015, entered into in connection with the issuance of the preferred stock, we have granted registration rights to the purchasers of our preferred stock and certain of their transferees with respect to INNOVATE common stock held by them and common stock underlying the preferred stock.
This significant amount of indebtedness poses risks such as risk of inability to repay such indebtedness, as well as: • increased vulnerability to general adverse economic and industry conditions; • higher interest expense if interest rates increase on our floating rate borrowings are not effective to mitigate the effects of these increases; • our Secured Notes are secured by substantially all of INNOVATE’s assets and those of certain of INNOVATE’s subsidiaries that have guaranteed the Secured Notes, including certain equity interests in our other subsidiaries and other investments, as well as certain intellectual property and trademarks, and those assets cannot be pledged to secure other financings; • certain assets of our subsidiaries are pledged to secure their indebtedness, and those assets cannot be pledged to secure other financings; • our having to divert a significant portion of our cash flow from operations to payments on our indebtedness and other arrangements, thereby reducing the availability of cash to fund working capital, capital expenditures, acquisitions, investments and other general corporate purposes; 22 • limiting our ability to obtain additional financing, on terms we find acceptable, if needed, for working capital, capital expenditures, expansion plans and other investments, which may limit our ability to implement our business strategy; • limiting our flexibility in planning for, or reacting to, changes in our businesses and the markets in which we operate or to take advantage of market opportunities; and • placing us at a competitive disadvantage compared to our competitors that have less debt and fewer other outstanding obligations.
This significant amount of indebtedness poses risks such as risk of inability to repay such indebtedness, as well as: • increased vulnerability to general adverse economic and industry conditions; • higher interest expense if interest rates increase on our floating rate borrowings are not effective to mitigate the effects of these increases; • our Secured Notes are secured by substantially all of INNOVATE’s assets and those of certain of INNOVATE’s subsidiaries that have guaranteed the Secured Notes, including certain equity interests in our other subsidiaries and other investments, as well as certain intellectual property and trademarks, and those assets cannot be pledged to secure other financings; • certain assets of our subsidiaries are pledged to secure their indebtedness, and those assets cannot be pledged to secure other financings; • our having to divert a significant portion of our cash flow from operations to payments on our indebtedness and other arrangements, thereby reducing the availability of cash to fund working capital, capital expenditures, acquisitions, investments and other general corporate purposes; • limiting our ability to obtain additional financing, on terms we find acceptable, if needed, for working capital, capital expenditures, expansion plans and other investments, which may limit our ability to implement our business strategy; • limiting our flexibility in planning for, or reacting to, changes in our businesses and the markets in which we operate or to take advantage of market opportunities; and • placing us at a competitive disadvantage compared to our competitors that have less debt and fewer other outstanding obligations.
For example, with any past or future acquisition, there is the possibility that: • we may not have implemented company policies, procedures and cultures, in an efficient and effective manner; • we may not be able to successfully reduce costs, increase advertising revenue or audience share; • we may fail to retain and integrate employees and key personnel of the acquired business and assets; • our management may be reassigned from overseeing existing operations by the need to integrate the acquired business; • we may encounter unforeseen difficulties in extending internal control and financial reporting systems at the newly acquired business; • we may fail to successfully implement technological integration with the newly acquired business or may exceed the capabilities of our technology infrastructure and applications; • we may not be able to generate adequate returns; • we may encounter and fail to address risks or other problems associated with or arising from our reliance on the representations and warranties and related indemnities, if any, provided to us by the sellers of acquired companies and assets; • we may suffer adverse short-term effects on operating results through increased costs and may incur future impairments of goodwill associated with the acquired business; • we may be required to increase our leverage and debt service or to assume unexpected liabilities in connection with our acquisitions; and • we may encounter unforeseen challenges in entering new markets in which we have little or no experience.
For example, with any past or future acquisition, there is the possibility that: • we may not have implemented company policies, procedures and cultures, in an efficient and effective manner; 24 • we may not be able to successfully reduce costs, increase advertising revenue or audience share; • we may fail to retain and integrate employees and key personnel of the acquired business and assets; • our management may be reassigned from overseeing existing operations by the need to integrate the acquired business; • we may encounter unforeseen difficulties in extending internal control and financial reporting systems at the newly acquired business; • we may fail to successfully implement technological integration with the newly acquired business or may exceed the capabilities of our technology infrastructure and applications; • we may not be able to generate adequate returns; • we may encounter and fail to address risks or other problems associated with or arising from our reliance on the representations and warranties and related indemnities, if any, provided to us by the sellers of acquired companies and assets; • we may suffer adverse short-term effects on operating results through increased costs and may incur future impairments of goodwill associated with the acquired business; • we may be required to increase our leverage and debt service or to assume unexpected liabilities in connection with our acquisitions; and • we may encounter unforeseen challenges in entering new markets in which we have little or no experience.
Our international operations are subject to a number of risks, including: • political conditions and events, including embargo; • changing regulatory environments; • outbreaks of pandemic diseases, including new COVID-19 variants, or fear of such outbreaks; • inflationary pressures; • restrictive actions by U.S. and foreign governments; 28 • the imposition of withholding or other taxes on foreign income, tariffs or restrictions on foreign trade and investment; • adverse tax consequences; • limitations on repatriation of earnings and cash; • currency exchange controls and import/export quotas; • nationalization, expropriation, asset seizure, blockades and blacklisting; • limitations in the availability, amount or terms of insurance coverage; • loss of contract rights and inability to adequately enforce contracts; • political instability, war and civil disturbances or other risks that may limit or disrupt markets, such as terrorist attacks, piracy and kidnapping; • fluctuations in currency exchange rates, hard currency shortages and controls on currency exchange that affect demand for our services and our profitability; • potential noncompliance with a wide variety of anti-corruption laws and regulations, such as the U.S.
Our international operations are subject to a number of risks, including: • political conditions and events, including embargo; • changing regulatory environments; • outbreaks of pandemic diseases, including new COVID-19 variants, or fear of such outbreaks; • inflationary pressures; • restrictive actions by U.S. and foreign governments; • the imposition of withholding or other taxes on foreign income, tariffs or restrictions on foreign trade and investment; • adverse tax consequences; • limitations on repatriation of earnings and cash; • currency exchange controls and import/export quotas; • nationalization, expropriation, asset seizure, blockades and blacklisting; • limitations in the availability, amount or terms of insurance coverage; • loss of contract rights and inability to adequately enforce contracts; • political instability, war and civil disturbances or other risks that may limit or disrupt markets, such as terrorist attacks, piracy and kidnapping; • fluctuations in currency exchange rates, hard currency shortages and controls on currency exchange that affect demand for our services and our profitability; • potential noncompliance with a wide variety of anti-corruption laws and regulations, such as the U.S.
The revenue, cost and gross profit realized on such contracts can vary, sometimes substantially, from the original projections due to a variety of factors, including, but not limited to: • failure to properly estimate costs of materials, including steel and steel components, engineering services, equipment, labor or subcontractors; • costs incurred in connection with modifications to a contract that may be unapproved by the customer as to scope, schedule, and/or price; • unanticipated technical problems with the structures, equipment or systems we supply; • unanticipated costs or claims, including costs for project modifications, customer-caused delays, errors or changes in specifications or designs, or contract termination; 33 • changes in the costs of materials, engineering services, equipment, labor or subcontractors; • changes in labor conditions, including the availability and productivity of labor; • productivity and other delays caused by weather conditions; • failure to engage necessary suppliers or subcontractors, or failure of such suppliers or subcontractors to perform; • difficulties in obtaining required governmental permits or approvals; • changes in laws and regulations; and • changes in general economic conditions.
The revenue, cost and gross profit realized on such contracts can vary, sometimes substantially, from the original projections due to a variety of factors, including, but not limited to: • failure to properly estimate costs of materials, including steel and steel components, engineering services, equipment, labor or subcontractors; • costs incurred in connection with modifications to a contract that may be unapproved by the customer as to scope, schedule, and/or price; • unanticipated technical problems with the structures, equipment or systems we supply; • unanticipated costs or claims, including costs for project modifications, customer-caused delays, errors or changes in specifications or designs, or contract termination; • changes in the costs of materials, engineering services, equipment, labor or subcontractors; • changes in labor conditions, including the availability and productivity of labor; • productivity and other delays caused by weather conditions; • failure to engage necessary suppliers or subcontractors, or failure of such suppliers or subcontractors to perform; • difficulties in obtaining required governmental permits or approvals; • changes in laws and regulations; and • changes in general economic conditions.
The issuance of additional shares of common stock or preferred stock may, among other things: • significantly dilute the equity interest and voting power of all other stockholders; • subordinate the rights of holders of our outstanding common stock and/or preferred stock if preferred stock is issued with rights senior to those afforded to holders of our common stock and/or preferred stock; • trigger an adjustment to the price at which all or a portion of our outstanding preferred stock converts into our common stock, if such stock is issued at a price lower than the then-applicable conversion price; • entitle our existing holders of preferred stock to purchase a portion of such issuance to maintain their ownership percentage, subject to certain exceptions; • call for us to make dividend or other payments not available to the holders of our common stock; and • cause a change in control of our company if a substantial number of shares of our common stock are issued and/or if additional shares of preferred stock having substantial voting rights are issued.
The issuance of additional shares of common stock or preferred stock may, among other things: • significantly dilute the equity interest and voting power of all other stockholders; • subordinate the rights of holders of our outstanding common stock and/or preferred stock if preferred stock is issued with rights senior to those afforded to holders of our common stock and/or preferred stock; • trigger an adjustment to the price at which all or a portion of our outstanding preferred stock converts into our common stock, if such stock is issued at a price lower than the then-applicable conversion price; • entitle our existing holders of preferred stock to purchase a portion of such issuance to maintain their ownership percentage, subject to certain exceptions; • call for us to make dividend or other payments not available to the holders of our common stock; and 30 • cause a change in control of our company if a substantial number of shares of our common stock are issued and/or if additional shares of preferred stock having substantial voting rights are issued.
Ongoing concerns about the systemic impact of potential long-term and widespread recession and potentially prolonged economic recovery, volatile energy costs, fluctuating commodity prices and interest rates, volatile exchange rates, geopolitical issues, including the armed conflict in Ukraine, natural disasters and pandemic illness, instability in credit markets, cost and terms of credit, consumer and business confidence and demand, a changing financial, regulatory and political environment, and substantially increased unemployment rates have all contributed to increased market volatility and diminished expectations for many established and emerging economies, including those in which we operate.
Ongoing concerns about the systemic impact of potential long-term and widespread recession and potentially prolonged economic recovery, volatile energy costs, fluctuating commodity prices and interest rates, volatile exchange rates, geopolitical issues, including the armed conflict in Ukraine and Israel, natural disasters and pandemic illness, instability in credit markets, cost and terms of credit, consumer and business confidence and demand, a changing financial, regulatory and political environment, and substantially increased unemployment rates have all contributed to increased market volatility and diminished expectations for many established and emerging economies, including those in which we operate.
These fluctuations may occur due to a variety of factors, many of which are outside of Pansend’s control and may be difficult to predict, including: • the timing and cost of, and level of investment in, research, development, and commercialization activities relating to Pansend’s product and product candidates, which may change from time to time; • the timing of receipt of approvals or clearances for Pansend’s product candidates from regulatory authorities in the U.S. or internationally; • the timing and status of enrollment for Pansend’s clinical trials; • coverage and reimbursement policies with respect to Pansend’s product and product candidates, including the degree to which treatments using its products are covered and receive adequate reimbursement from third-party payors, and potential future drugs or devices that compete with its products; • the cost of manufacturing Pansend’s product, as well as building out its supply chain, which may vary depending on the quantity of • production and the terms of Pansend’s agreements with manufacturers; • expenditures that Pansend may incur to acquire, develop or commercialize additional product candidates and technologies; 38 • the level of demand for Pansend’s product and any product candidates, if approved or cleared, which may vary significantly over time; • litigation, including patent, employment, securities class action, stockholder derivative, general commercial, and other lawsuits; and • the timing and success or failure of nonclinical studies and clinical trials for Pansend’s product candidates or competing product candidates, or any other change in the competitive landscape of the life sciences industry, including consolidation among Pansend’s competitors or partners.
These fluctuations may occur due to a variety of factors, many of which are outside of Pansend’s control and may be difficult to predict, including: • the timing and cost of, and level of investment in, research, development, and commercialization activities relating to Pansend’s product and product candidates, which may change from time to time; 37 • the timing of receipt of approvals or clearances for Pansend’s product candidates from regulatory authorities in the U.S. or internationally; • the timing and status of enrollment for Pansend’s clinical trials; • coverage and reimbursement policies with respect to Pansend’s product and product candidates, including the degree to which treatments using its products are covered and receive adequate reimbursement from third-party payors, and potential future drugs or devices that compete with its products; • the cost of manufacturing Pansend’s product, as well as building out its supply chain, which may vary depending on the quantity of • production and the terms of Pansend’s agreements with manufacturers; • expenditures that Pansend may incur to acquire, develop or commercialize additional product candidates and technologies; • the level of demand for Pansend’s product and any product candidates, if approved or cleared, which may vary significantly over time; • litigation, including patent, employment, securities class action, stockholder derivative, general commercial, and other lawsuits; and • the timing and success or failure of nonclinical studies and clinical trials for Pansend’s product candidates or competing product candidates, or any other change in the competitive landscape of the life sciences industry, including consolidation among Pansend’s competitors or partners.
These exposures include but are not limited to: • re-measurement gains and losses from changes in the value of foreign denominated assets and liabilities; • translation gains and losses on foreign subsidiary financial results that are translated into U.S. dollars, our functional currency, upon consolidation; and • planning risk related to changes in exchange rates between the time we prepare our annual and quarterly forecasts and when actual results occur.
These exposures include but are not limited to: • re-measurement gains and losses from changes in the value of foreign denominated assets and liabilities; • translation gains and losses on foreign subsidiary financial results that are translated into U.S. dollars, our functional currency, upon consolidation; and • planning risk related to changes in exchange rates between the time we prepare our annual and quarterly forecasts and when actual 23 results occur.
Some of these events could be the basis for FDA or other regulatory action, including injunction, recall, seizure, or total or partial suspension of production. Pansend currently has limited product revenue and may never become profitable. To date, Pansend has generated limited revenue and has historically relied on financing from the sale of equity securities to fund its operations.
Some of these events could be the basis for FDA or other regulatory action, including injunction, recall, seizure, or total or partial suspension of production. 38 Pansend currently has limited product revenue and may never become profitable. To date, Pansend has generated limited revenue and has historically relied on financing from the sale of equity securities to fund its operations.
Other remedies that government agencies may seek for improper activities or performance issues include sanctions such as forfeiture of profit and suspension of payments. In addition to the risks noted above, legislatures typically appropriate funds on a year-by-year basis, while contract performance may take more than one year.
Other remedies that government agencies may seek for improper activities or performance issues include sanctions such as forfeiture of profit and suspension of payments. 34 In addition to the risks noted above, legislatures typically appropriate funds on a year-by-year basis, while contract performance may take more than one year.
Even if Pansend achieves profitability, it may not be able to sustain or increase profitability on a quarterly or annual basis. 39 Pansend’s failure to obtain or maintain necessary FDA clearances and approvals, or to maintain continued clearances, or equivalents thereof in the U.S. and relevant foreign markets, could hurt its ability to distribute and market its products.
Even if Pansend achieves profitability, it may not be able to sustain or increase profitability on a quarterly or annual basis. Pansend’s failure to obtain or maintain necessary FDA clearances and approvals, or to maintain continued clearances, or equivalents thereof in the U.S. and relevant foreign markets, could hurt its ability to distribute and market its products.
If a material weakness exists as of a future period year-end (including a material weakness identified prior to year-end for which there is an insufficient period of time to evaluate and confirm the effectiveness of the corrections or related new procedures), our management will be unable to report favorably as of such future period year-end to the effectiveness of our control over financial reporting.
If a material weakness exists as of a future period year-end (including a material weakness identified prior to year-end for which there is an insufficient period of time to evaluate and confirm the effectiveness of the corrections or related new procedures), our management will be unable to report favorably as of such future period year-end to the effectiveness of our internal control over financial reporting.
If the amount DBMG is required to pay for third-party goods and services in an effort to meet its contractual obligations exceeds the amount it has estimated, DBMG could experience project losses or a reduction in estimated profit. 35 Persistent inflation and economic uncertainty may negatively impact DBMG's business.
If the amount DBMG is required to pay for third-party goods and services in an effort to meet its contractual obligations exceeds the amount it has estimated, DBMG could experience project losses or a reduction in estimated profit. Persistent inflation and economic uncertainty may negatively impact DBMG's business.
Physician Payment Sunshine Act, now known as Open Payments, requires Pansend to report to the Centers for Medicare & Medicaid Services, or CMS, payments and other transfers of value to all U.S. physicians and U.S. teaching hospitals, with the reported information made publicly available on a searchable website.
For example, the U.S. Physician Payment Sunshine Act, now known as Open Payments, requires Pansend to report to the Centers for Medicare & Medicaid Services, or CMS, payments and other transfers of value to all U.S. physicians and U.S. teaching hospitals, with the reported information made publicly available on a searchable website.
Given the scarcity of professionals with the scientific knowledge that Pansend requires and the competition for qualified personnel among life science businesses, Pansend may not succeed in attracting or retaining the personnel Pansend requires to continue and grow its operations. 41 Rapidly changing technology in life sciences could make the products Pansend is developing obsolete.
Given the scarcity of professionals with the scientific knowledge that Pansend requires and the competition for qualified personnel among life science businesses, Pansend may not succeed in attracting or retaining the personnel Pansend requires to continue and grow its operations. Rapidly changing technology in life sciences could make the products Pansend is developing obsolete.
Continued uncertainty in the U.S. and international markets and economies and prolonged stagnation in business and consumer spending may adversely affect our liquidity and financial condition, and the liquidity and financial condition of our customers, including our ability to access capital markets and obtain capital lease financing to meet liquidity needs. Climate change may have an impact on our business.
Continued uncertainty in the U.S. and international markets and economies and prolonged stagnation in business and consumer spending may adversely affect our liquidity and financial condition, and the liquidity and financial condition of our customers, including our ability to access capital markets and obtain capital lease financing to meet liquidity needs. 27 Climate change may have an impact on our business.
We can provide no assurance that DBMG would be able to access such capital and credit as needed or that it would be able to do so on economically attractive terms. 34 Commitments may be in the form of written contracts, letters of intent, notices to proceed and purchase orders.
We can provide no assurance that DBMG would be able to access such capital and credit as needed or that it would be able to do so on economically attractive terms. Commitments may be in the form of written contracts, letters of intent, notices to proceed and purchase orders.
As a result, INNOVATE’s principal source of revenue and cash flow is distributions from its subsidiaries and its subsidiaries may be limited by law and by contract in making distributions to INNOVATE. As a holding company, INNOVATE's material assets are its cash and cash equivalents, the equity interests in its subsidiaries and other investments.
As a result, INNOVATE’s principal source of cash and cash flow is distributions from its subsidiaries and its subsidiaries may be limited by law and by contract in making distributions to INNOVATE. As a holding company, INNOVATE's material assets are its cash and cash equivalents, the equity interests in its subsidiaries and other investments.
However, the Certificate of Incorporation authorizes our board of directors (the "INNOVATE Board of Directors"), from time to time, subject to limitations prescribed by law and any consent rights granted to holders of outstanding shares of preferred stock, to issue additional shares of preferred stock having rights that are senior to those afforded to the holders of our common stock.
However, our certificate of incorporation authorizes our board of directors, from time to time, subject to limitations prescribed by law and any consent rights granted to holders of outstanding shares of preferred stock, to issue additional shares of preferred stock having rights that are senior to those afforded to the holders of our common stock.
We are subject to the provisions of Section 203 of the Delaware General Corporation Law which limit the right of a corporation to engage in a business combination with a holder of 15 percent or more of the corporation’s outstanding voting securities, or certain affiliated persons.
We are subject to the provisions of Section 203 of the Delaware General Corporation Law which limit the right of a corporation to engage in a 31 business combination with a holder of 15 percent or more of the corporation’s outstanding voting securities, or certain affiliated persons.
Applications for permits may be opposed by governmental entities, individuals or special interest groups, resulting in delays and possible non-issuance of the permits. 36 DBMG’s failure to obtain or maintain required licenses may adversely affect its business.
Applications for permits may be opposed by governmental entities, individuals or special interest groups, resulting in delays and possible non-issuance of the permits. DBMG’s failure to obtain or maintain required licenses may adversely affect its business.
Our future financial performance and our ability to compete effectively will depend, in part, on our ability to manage any future growth effectively. We may not be able to fully utilize our net operating loss and other tax carryforwards.
Our future financial performance and our ability to compete effectively will depend, in part, on our ability to manage any future growth effectively. 25 We may not be able to fully utilize our net operating loss and other tax carryforwards.
DBMG’s projects are awarded through a competitive bid process or are obtained through negotiation, in either case generally using one of two types of contract pricing approaches: fixed-price or cost-plus pricing.
DBMG’s projects are awarded through a competitive bid process or are obtained through negotiation, but in either case generally using one of two types of contract pricing approaches: fixed-price or cost-plus pricing.
These risks are discussed more fully below and include, but are not limited to, the following, any of which could have a material adverse effect on our financial condition, results of operations and cash flows: 18 Risks Related to Our Businesses • The ability of our subsidiaries to make distributions, our principal source of cash • Our levels of indebtedness, financing arrangements and other obligations • Restrictive covenants in our debt and preferred stock instruments • The COVID-19 pandemic and its effects on our liquidity, business, financial condition and results of operations • Ability to meet working capital requirements • Dependence on key personnel and ability to attract and retain skilled personnel • Any identified material weaknesses in our internal controls • Impact of inflationary pressures • Constraints in the labor market and increases in labor costs • Foreign exchange rate volatility • Impact of competition on our business • Impact of any potential future acquisitions and ability to manage future growth and the incurrence of substantial costs in connection with acquisitions • Cyber-attacks and other privacy or data security incidents • Managing growth related to increased operational size • Ability to fully utilize net operating loss and other tax carryforwards • Risk of restated financial statements • Presentation of corporate opportunities by certain current and former directors and officers and the impact of related party transactions • Our status as a non-investment company • Impact of potential litigation • Deterioration of global economic conditions and the impact of operating globally • Impact of climate change • Compliance costs related to our acquired businesses • Ability of our development stage companies to produce revenues or income • Adverse tax impact of our acquisitions or dispositions • Lack of sole control in joint venture investments • Ability to protect our intellectual property • Potential dilution of our current stockholders • Effect of future sales of common stock by preferred stockholders • Common stock price fluctuations • Prevention of potential takeover due to Delaware law and charter documents • Activist stockholders Risks Related to the Infrastructure segment • Unpredictability in timing of DBMG’s construction contracts and payments thereunder • Transportation challenges as a result of COVID-19 • Impact of construction contract pricing terms, including fixed-price and cost-plus pricing • Termination or cancellation of construction projects • Increased concentration of construction projects in backlog • Ability to realize revenue value reported in backlog • Ability to meet contractual schedule or performance requirements • Modification or termination of government contracts • Reliability of subcontractors and third-party vendors • Impact of inflationary pressures • Volatility in the supply and demand for steel and steel components • Dependability of steel component suppliers • Intense competition in construction markets • Ability of customers to receive applicable regulatory and environmental approvals • Impact of failure to obtain or maintain required licenses • Impact of bonding and letter of credit capacity • Variability in liquidity over time • Exposure to professional liability, product liability, warranty and other claims • Impact of environmental compliance costs • Impact of potential litigation • Union labor disruptions that would interfere with operations • Ability to maintain safe work environment Risks related to the Life Sciences segment • Significant fluctuations in Pansend's operating results • High levels of competition in the life sciences space 19 • Reliance on third parties for sales, marketing, manufacturing and/or distribution • Limited current and historical operating revenue • Impact of a failure to obtain or maintain necessary FDA (or foreign equivalent) clearances and approvals • Risks associated with the misuse by customers, physicians and technicians of Pansend's products • Pansend's limited manufacturing experience • Competition for skilled technical professional personnel • Obsolescence of Pansend's products • Ability of Pansend to effectively protect its intellectual property and the impact of a failure to do so • Patient satisfaction with R2's procedures • Impact of third party intellectual property infringement claims Risks related to the Spectrum segment • Effectiveness of our operations in a highly competitive market • Impact of FCC regulations, including with respect to broadcasting licenses, or Congressional legislation Risk Factors The following risk factors and the forward-looking statements elsewhere herein should be read carefully in connection with evaluating the business of the Company and its subsidiaries.
These risks are discussed more fully below and include, but are not limited to, the following, any of which could have a material adverse effect on our financial condition, results of operations and cash flows: 18 Risks Related to Our Businesses • The ability of our subsidiaries to make distributions, our principal source of cash • Our levels of indebtedness, financing arrangements and other obligations • Restrictive covenants in our debt and preferred stock instruments • Ability to meet working capital requirements • Dependence on key personnel and ability to attract and retain skilled personnel • Any identified material weaknesses in our internal controls • Impact of inflationary pressures • Constraints in the labor market and increases in labor costs • Foreign exchange rate volatility • Impact of competition on our business • Impact of any potential future acquisitions and ability to manage future growth and the incurrence of substantial costs in connection with acquisitions • Cyber-attacks and other privacy or data security incidents • Managing growth related to increased operational size • Ability to fully utilize net operating loss and other tax carryforwards • Risk of restated financial statements • Presentation of corporate opportunities by certain current and former directors and officers and the impact of related party transactions • Our status as a non-investment company • Impact of potential litigation • Deterioration of global economic conditions and the impact of operating globally • Impact of climate change • Compliance costs related to our acquired businesses • Ability of our development stage companies to produce revenues or income • Adverse tax impact of our acquisitions or dispositions • Lack of sole control in joint venture investments • Ability to protect our intellectual property • Potential dilution of our current stockholders • Effect of future sales of common stock by preferred stockholders • Common stock price fluctuations • Prevention of potential takeover due to Delaware law and charter documents • Activist stockholders • Adoption of artificial intelligence ("AI") and government regulation Risks Related to the Infrastructure segment • Unpredictability in timing of DBMG’s construction contracts and payments thereunder • Impact of construction contract pricing terms, including fixed-price and cost-plus pricing • Termination or cancellation of construction projects • Increased concentration of construction projects in backlog • Ability to realize revenue value reported in backlog • Ability to meet contractual schedule or performance requirements • Modification or termination of government contracts • Reliability of subcontractors and third-party vendors • Impact of inflationary pressures • Volatility in the supply and demand for steel and steel components • Dependability of steel component suppliers • Intense competition in construction markets • Ability of customers to receive applicable regulatory and environmental approvals • Impact of failure to obtain or maintain required licenses • Impact of bonding and letter of credit capacity • Variability in liquidity over time • Exposure to professional liability, product liability, warranty and other claims • Impact of environmental compliance costs • Impact of potential litigation • Union labor disruptions that would interfere with operations • Ability to maintain safe work environment Risks related to the Life Sciences segment • Significant fluctuations in Pansend's operating results • High levels of competition in the life sciences space • Reliance on third parties for sales, marketing, manufacturing and/or distribution • Limited current and historical operating revenue • Impact of a failure to obtain or maintain necessary FDA (or foreign equivalent) clearances and approvals 19 • Risks associated with the misuse by customers, physicians and technicians of Pansend's products • Pansend's limited manufacturing experience • Competition for skilled technical professional personnel • Obsolescence of Pansend's products • Ability of Pansend to effectively protect its intellectual property and the impact of a failure to do so • Patient satisfaction with R2's procedures • Impact of third party intellectual property infringement claims Risks related to the Spectrum segment • Effectiveness of our operations in a highly competitive market • Impact of FCC regulations, including with respect to broadcasting licenses, or Congressional legislation Risk Factors The following risk factors and the forward-looking statements elsewhere herein should be read carefully in connection with evaluating the business of the Company and its subsidiaries.
For a description of our and our subsidiaries' indebtedness, refer to Note 13. Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
For a description of our and our subsidiaries' indebtedness, refer to Note 11. Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
A portion of DBMG’s employees are represented by labor unions, and 22% of DBMG’s employees are covered under collective bargaining agreements that expire in less than one year, at which time they will be renegotiated. A lengthy strike or other work stoppage at any of its facilities could have a material adverse effect on DBMG’s business.
A portion of DBMG’s employees are represented by labor unions, and 14.1% of DBMG’s employees are covered under collective bargaining agreements that expire in less than one year, at which time they will be renegotiated. A lengthy strike or other work stoppage at any of its facilities could have a material adverse effect on DBMG’s business.
We cannot provide any assurances that we will remain competitive with these developing technologies and our inability to successfully respond to new and growing sources of competition in the broadcasting industry could have an adverse effect on Broadcasting's business, financial condition and results of operations. The Federal Communications Commission ("FCC") could implement regulations or the U.S.
We cannot provide any assurances that we will remain competitive with these developing technologies and our inability to successfully respond to new and growing sources of competition in the broadcasting industry could have an adverse effect on Broadcasting's business, financial condition and results of operations. The FCC could implement regulations or the U.S.
Any failure to retain stable and dedicated labor by us may lead to disruption to our business operations. Although we have not experienced any labor shortages to date, we have observed an overall tightening and increasingly competitive labor market.
Any failure to retain stable and dedicated labor by us may lead to disruption to our business operations. Although we have not experienced any labor shortages to date, we have observed an overall tightening and increasingly competitive labor market since 2021.
Most licenses for commercial and noncommercial TV broadcast stations, Class A TV broadcast stations, television translators and Low Power Television ("LPTV") broadcast stations have expirations between 2023 and 2031; however, the Communications Act requires the FCC to renew a broadcast license if the FCC finds that the station has served the public interest, convenience and necessity and, with respect to the station, there have been no serious violations by the licensee of either the Communications Act or the FCC’s rules and regulations and there have been no other violations by the licensee of the Communications Act or the FCC’s rules and regulations that, taken together, constitute a pattern of abuse.
Most licenses for commercial and noncommercial TV broadcast stations, Class A TV broadcast stations, television translators and LPTV broadcast stations have expirations between 2028 and 2031; however, the Communications Act requires the FCC to renew a broadcast license if the FCC finds that the station has served the public interest, convenience and necessity and, with respect to the station, there have been no serious violations by the licensee of either the Communications Act or the FCC’s rules and regulations and there have been no other violations by the licensee of the Communications Act or the FCC’s rules and regulations that, taken together, constitute a pattern of abuse.
The Plan is intended to help protect the Company's ability to use its tax net operating losses and other certain tax assets ("Tax Benefits") by deterring an "ownership change," as defined under the Code, by a person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more of the outstanding common shares.
The 2021 Preservation Plan was intended to help protect the Company's ability to use its tax net operating losses and other certain tax assets ("Tax Benefits") by deterring an "ownership change," as defined under the Code, by a person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more of the outstanding common shares.
DBMG may be exposed to additional risks as it obtains new significant awards and executes its backlog, including greater backlog concentration in fewer projects, potential cost overruns and increasing requirements for letters of credit, and inability to fully realize the revenue value reported in its backlog, a substantial portion of which is attributable to a relatively small number of large contracts or other commitments, each of which could have a material adverse effect on DBMG’s results of operations, cash flows or financial condition.
If DBMG is unable to collect amounts owed to it, this could have a material adverse effect on DBMG’s results of operations, cash flows or financial condition. 33 DBMG may be exposed to additional risks as it obtains new significant awards and executes its backlog, including greater backlog concentration in fewer projects, potential cost overruns and increasing requirements for letters of credit, and inability to fully realize the revenue value reported in its backlog, a substantial portion of which is attributable to a relatively small number of large contracts or other commitments, each of which could have a material adverse effect on DBMG’s results of operations, cash flows or financial condition.
This may adversely affect the marketability of our common stock by discouraging any individual, firm, corporation, partnership or other person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more shares of our common stock then outstanding.
The 2023 Preservation Plan may adversely affect the marketability of our common stock by discouraging any individual, firm, corporation, partnership or other person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more shares of our common stock then outstanding.
In addition, although the Rights Agreement is intended to reduce the likelihood of an ownership change that could adversely affect utilization of our NOLs, there is no assurance that the Plan will prevent all transfers that could result in such an ownership change.
In addition, although the 2023 Preservation Plan is intended to reduce the likelihood of an ownership change that could adversely affect utilization of our NOLs, there is no assurance that the 2023 Preservation Plan will prevent all transfers that could result in such an ownership change.
We also own a minority interest in a number of entities, such as MediBeacon, Triple Ring Technologies, Inc. and HMN, over which we do not exercise, or have only limited, management control, and we are, therefore, unable to direct or manage the business to realize the anticipated benefits that we can achieve through full integration.
We also own minority interests in a number of entities, such as MediBeacon, Triple Ring Technologies, Inc. and Scaled Cell Solutions, Inc., over which we do not exercise, or have only limited, management control, and we are, therefore, unable to direct or manage the business to realize the anticipated benefits that we can achieve through full integration.
We recognized net loss attributable to INNOVATE of $35.9 million in 2022 and net loss attributable to INNOVATE of $227.5 million in 2021, and have incurred net losses in prior periods. We cannot assure you that our business will generate cash flow from operations in an amount sufficient to fund our liquidity needs.
We recognized net loss attributable to INNOVATE of $35.2 million in 2023 and net loss attributable to INNOVATE of $35.9 million in 2022, and have incurred net losses in prior periods. We cannot assure you that our business will generate cash flow from operations in an amount sufficient to fund our liquidity needs.
Furthermore, any proceeds that we could realize from any such disposition may not be adequate to meet our obligations. For the years ended December 31, 2022 and 2021, we recognized cash flows used in continuing operating activities of $9.5 million and $6.5 million, respectively.
Furthermore, any proceeds that we could realize from any such disposition may not be adequate to meet our obligations. For the years ended December 31, 2023 and 2022, we recognized cash flows provided by continuing operating activities of $26.5 million and cash used in continuing operating activities of $9.5 million, respectively.
The Company had 38 pending renewal applications at the end of 2022, and will have 6 applications due in 2023. Third parties may oppose license renewals. A station remains authorized to operate while its license renewal application is pending. 43 License Assignments. The Communications Act requires prior FCC approval for the assignment or transfer of control of an FCC licensee.
The Company had 17 pending renewal applications at the end of 2023, and will have no applications due in 2024. Third parties may oppose license renewals. A station remains authorized to operate while its license renewal application is pending. License Assignments. The Communications Act requires prior FCC approval for the assignment or transfer of control of an FCC licensee.
The decision to undergo one of R2’s procedures is thus driven by patient demand, which may be influenced by a number of factors, such as: • the success of R2’s sales and marketing programs; • the extent to which R2’s physician customers recommend its procedures to their patients; • the extent to which R2’s procedures satisfy patient expectations; • R2’s ability to properly train its physician customers in the use of its systems so that their patients do not experience excessive discomfort during treatment or adverse side effects; • the cost, safety, and effectiveness of R2’s systems versus other aesthetic treatments; • consumer sentiment about the benefits and risks of aesthetic procedures generally and R2’s systems in particular; • the success of any direct-to-consumer marketing efforts R2 may initiate; and • general consumer confidence, which may be impacted by economic and political conditions outside of R2’s control.
The decision to undergo one of R2’s procedures is thus driven by patient demand, which may be influenced by a number of factors, such as: • the success of R2’s sales and marketing programs; • the extent to which R2’s physician customers recommend its procedures to their patients; • the extent to which R2’s procedures satisfy patient expectations; • R2’s ability to properly train its physician customers in the use of its systems so that their patients do not experience excessive discomfort during treatment or adverse side effects; • the cost, safety, and effectiveness of R2’s systems versus other aesthetic treatments; • consumer sentiment about the benefits and risks of aesthetic procedures generally and R2’s systems in particular; • the success of any direct-to-consumer marketing efforts R2 may initiate; and • general consumer confidence, which may be impacted by economic and political conditions outside of R2’s control. 41 R2’s financial performance will be negatively impacted in the event it cannot generate significant patient demand for procedures performed with its systems.
Pansend is also subject to other risks relating to its manufacturing capabilities, including: • quality and reliability of components, sub-assemblies and materials that Pansend sources from third-party suppliers, who are required to meet Pansend’s quality specifications, some of whom are Pansend’s single-source suppliers for the products they supply; • failure to secure raw materials, components and materials in a timely manner, in sufficient quantities or on commercially reasonable terms; • inability to secure raw materials, components and materials of sufficient quality to meet the exacting needs of medical device manufacturing; • failure to maintain compliance with quality system requirements or pass regulatory quality inspections; • inability to increase production capacity or volumes to meet demand; and • inability to design or modify production processes to enable Pansend to produce future products efficiently or implement changes in current products in response to design or regulatory requirements.
Pansend is also subject to other risks relating to its manufacturing capabilities, including: • quality and reliability of components, sub-assemblies and materials that Pansend sources from third-party suppliers, who are required to meet Pansend’s quality specifications, some of whom are Pansend’s single-source suppliers for the products they supply; • failure to secure raw materials, components and materials in a timely manner, in sufficient quantities or on commercially reasonable terms; • inability to secure raw materials, components and materials of sufficient quality to meet the exacting needs of medical device manufacturing; • failure to maintain compliance with quality system requirements or pass regulatory quality inspections; • inability to increase production capacity or volumes to meet demand; and • inability to design or modify production processes to enable Pansend to produce future products efficiently or implement changes in current products in response to design or regulatory requirements. 40 These risks could be exacerbated by Pansend’s limited experience as an entity with large-scale commercial manufacturing.
For example, the recent armed conflict between Ukraine and Russia has resulted in significant uncertainty in the commodities markets. A prolonged conflict and any sanctions or import controls targeting the Russian oil and natural gas industries could lead to sustained increases in energy prices.
For example, the recent armed conflicts in Ukraine and Israel have resulted in significant uncertainty in the commodities markets. A prolonged conflict and any sanctions or import controls targeting the Russian oil and natural gas industries could lead to sustained increases in energy prices.
If a corporation undergoes an “ownership change,” which is generally defined as an increase of more than 50% of the value of a corporation’s stock owned by certain “5-percent shareholders” (as such term is defined in Internal Revenue Code Section 382) over a rolling three-year period, the corporation’s ability to use its pre-change NOLs and certain other pre-change tax attributes to offset its post-change income or taxes may be limited. 26 On August 30, 2021, the Company entered into a Tax Benefits Preservation Plan (the "Plan").
If a corporation undergoes an “ownership change,” which is generally defined as an increase of more than 50% of the value of a corporation’s stock owned by certain “5-percent shareholders” (as such term is defined in Internal Revenue Code Section 382) over a rolling three-year period, the corporation’s ability to use its pre-change NOLs and certain other pre-change tax attributes to offset its post-change income or taxes may be limited.
Thus, its ability to service its debt, including the $330.0 million in aggregate principal amount of 8.5% Senior Secured Notes due 2026 (the "Secured Notes"), $51.8 million aggregate principal of 7.50% convertible senior notes due 2026 (the "2026 Convertible Notes"), and $20.0 million secured revolving credit agreement (the “Revolving Credit Agreement”), of which $20.0 million was drawn as of December 31, 2022, and to finance future acquisitions, is dependent on the ability of its subsidiaries to generate sufficient net income and cash flows to make upstream cash distributions to INNOVATE.
Thus, its ability to service its debt, including the $330.0 million in aggregate principal amount of 8.5% Senior Secured Notes due 2026 (the "Secured Notes"), $51.8 million aggregate principal of 7.50% convertible senior notes due 2026 (the "2026 Convertible Notes"), $35.1 million aggregate principal amount of 9.0% unsecured notes issued to the Continental General Insurance Company ("CGIC") due 2026 (the "CGIC Unsecured Note") and $20.0 million secured revolving credit agreement (the “Revolving Credit Agreement”), of which $20.0 million was drawn as of December 31, 2023, and to finance future acquisitions, is dependent on the ability of its subsidiaries to generate sufficient net income and cash flows to make upstream cash distributions to INNOVATE.
As DBMG obtains new significant project awards, these projects may use larger sums of working capital than other projects and DBMG’s backlog may become concentrated among a smaller number of customers. At December 31, 2022, DBMG's backlog was $1,782.3 million, consisting of $1,536.3 million under contracts or purchase orders and $246.0 million under letters of intent or notices to proceed.
As DBMG obtains new significant project awards, these projects may use larger sums of working capital than other projects and DBMG’s backlog may become concentrated among a smaller number of customers. At December 31, 2023, DBMG's backlog was $1,057.2 million, consisting of $1,032.9 million under contracts or purchase orders and $24.3 million under letters of intent or notices to proceed.
Broadcasting also faces competition from (i) local free over-the-air broadcast television and radio stations; (ii) telecommunication companies; (iii) cable and satellite system operators and cable networks; (iv) print media providers such as newspapers, direct mail and periodicals; (v) internet search engines, internet service providers, websites, and mobile applications; and (vi) other emerging technologies including mobile television.
Broadcasting also faces competition from (i) local free over-the-air broadcast television and radio stations; (ii) telecommunication companies; (iii) cable and satellite system operators and cable networks; (iv) print media providers such as newspapers, direct mail and periodicals; (v) internet search engines, internet service providers, websites, and mobile applications; (vi) viewers moving to programming alternatives and alternate media content providers, a process known as "cord cutting"; and (vii) other emerging technologies including mobile television.
As of December 31, 2022, the Company had $80.4 million of cash and cash equivalents, excluding restricted cash. On a stand-alone basis, as of December 31, 2022, the Non-Operating Corporate segment had cash and cash equivalents, excluding restricted cash, of $9.1 million. INNOVATE’s principal source of revenue and cash flow is distributions from its subsidiaries.
As of December 31, 2023, the Company had $80.8 million of cash and cash equivalents, excluding restricted cash. On a stand-alone basis, as of December 31, 2023, the Non-Operating Corporate segment had cash and cash equivalents, excluding restricted cash, of $2.5 million. INNOVATE’s principal source of cash and cash flow is distributions from its subsidiaries.
In addition, if INNOVATE depends on distributions and loans from its subsidiaries to make payments on INNOVATE’s debt, and if such subsidiaries were unable to distribute or loan money to INNOVATE, INNOVATE could default on its debt, which would permit the holders of such debt to accelerate the maturity of the debt which may also accelerate the maturity of other debt of ours with cross-default or cross-acceleration provisions.
In addition, if INNOVATE depends on distributions and loans from its subsidiaries to make payments on INNOVATE’s debt, and if such subsidiaries were unable to distribute or loan money to INNOVATE, INNOVATE could default on its debt, which would permit the holders of such debt to accelerate the maturity of the debt which may also accelerate the maturity of other debt of ours with cross-default or cross-acceleration provisions. 20 To service our indebtedness and other obligations, we will require a significant amount of cash.
Such reviews and investigations may result in civil and criminal proceedings; the imposition of substantial fines and penalties; the receipt of warning letters, untitled letters, demands for recalls or the seizure of Pansend’s products; the requirement to enter into corporate integrity agreements, stipulated judgments or other administrative remedies, and result in Pansend’s incurring substantial unanticipated costs and the diversion of key personnel and management’s attention from their regular duties, any of which may have an adverse effect on Pansend’s financial condition, results of operations and liquidity, and may result in greater and continuing governmental scrutiny of Pansend’s business in the future.
Such reviews and investigations may result in civil and criminal proceedings; the imposition of substantial fines and penalties; the receipt of warning letters, untitled letters, demands for recalls or the seizure of Pansend’s products; the requirement to enter into corporate integrity agreements, stipulated judgments or other administrative remedies, and result in Pansend’s incurring substantial unanticipated costs and the diversion of key personnel and management’s attention from their regular duties, any of which may have an adverse effect on Pansend’s financial condition, results of operations and liquidity, and may result in greater and continuing governmental scrutiny of Pansend’s business in the future. 39 Additionally, federal, state and foreign governments and entities have enacted laws and issued regulations and other standards requiring increased visibility and transparency of Pansend’s interactions with healthcare providers.
These supply chain disruptions and transportation challenges could have a material adverse effect on DBMG’s results of operations or financial condition. The nature of DBMG’s primary contracting terms for its contracts, including fixed-price and cost-plus pricing, could have a material adverse effect on DBMG’s results of operations, cash flows or financial condition.
Such expenditures could have a material adverse effect on DBMG’s results of operations, cash flows or financial condition. 32 The nature of DBMG’s primary contracting terms for its contracts, including fixed-price and cost-plus pricing, could have a material adverse effect on DBMG’s results of operations, cash flows or financial condition.
Specifically, DBMG is party to credit agreements that include certain financial covenants that can limit the amount of cash available to make upstream dividend payments to INNOVATE. For additional information, refer to Item 7.
Specifically, DBMG is party to credit agreements that include certain financial covenants that can limit the amount of cash available to make upstream dividend payments to INNOVATE. For additional information, refer to Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources".
In addition, the existence of the 2026 Convertible Notes may encourage short selling by market participants because the conversion of the notes could be used to satisfy short positions, or anticipated conversion of the notes into shares of our common stock could depress the market price of our common stock. 31 Future sales of substantial amounts of our common stock by holders of our preferred stock or other significant stockholders may adversely affect the market price of our common stock.
In addition, the existence of the 2026 Convertible Notes may encourage short selling by market participants because the conversion of the notes could be used to satisfy short positions, or anticipated conversion of the notes into shares of our common stock could depress the market price of our common stock.
As of December 31, 2022 and 2021, management concluded that our internal control over financial reporting was effective. 23 In future periods, if the process required by Section 404 of the Sarbanes-Oxley Act of 2002, (the "Sarbanes-Oxley Act") reveals or we otherwise identify one or more material weaknesses or significant deficiencies, the correction of any such material weakness or significant deficiency could require additional remedial measures including additional personnel which could be costly and time-consuming.
In future periods, if the process required by Section 404 of the Sarbanes-Oxley Act of 2002, (the "Sarbanes-Oxley Act") reveals or we otherwise identify one or more material weaknesses or significant deficiencies, the correction of any such material weakness or significant deficiency could require additional remedial measures including additional personnel which could be costly and time-consuming.
In addition, some of our operating subsidiaries may use trademarks which have not been registered and may be more difficult to protect. We might be required to spend significant resources to monitor and protect our intellectual property rights.
Accordingly, despite our efforts, we may be unable to prevent third parties from infringing upon or misappropriating our intellectual property. In addition, some of our operating subsidiaries may use trademarks which have not been registered and may be more difficult to protect. We might be required to spend significant resources to monitor and protect our intellectual property rights.
The FCC has also adopted regulations concerning children’s television programming, commercial limits, local issues and programming, political files, sponsorship identification, equal employment opportunity requirements and other requirements for full power and Class A broadcast television stations. The FCC’s rules require operational full-power and Class A stations to file quarterly reports demonstrating compliance with these regulations.
The FCC has also adopted regulations concerning children’s television programming, commercial limits, local issues and programming, political files, sponsorship identification, equal employment opportunity requirements and other requirements for full power and Class A broadcast television stations.
The occurrence of any of these events or our inability generally to successfully implement our acquisition and investment strategy would have an adverse effect, which could be material, on our business, financial condition and results of operations. 25 We rely on information systems to conduct our businesses, and failure to protect these systems against security breaches and otherwise to implement, integrate, upgrade and maintain such systems in working order could have a material adverse effect on our results of operations, cash flows or financial condition.
We rely on information systems to conduct our businesses, and failure to protect these systems against security breaches and otherwise to implement, integrate, upgrade and maintain such systems in working order could have a material adverse effect on our results of operations, cash flows or financial condition.
In addition, the fact that Pansend trains technicians whom it does not supervise in the use of the Glacial Rx system during patient treatment may expose Pansend to third-party claims if it is accused of providing inadequate training.
If a physician elects to apply an off-label use and the use leads to injury, Pansend may be involved in costly litigation. In addition, the fact that Pansend trains technicians whom it does not supervise in the use of the Glacial Rx system during patient treatment may expose Pansend to third-party claims if it is accused of providing inadequate training.
Moreover, as permitted by Delaware law, our Certificate of Incorporation contains a provision that renounces our expectation to certain corporate opportunities that are presented to our current and future directors that serve in capacities with other entities.
Moreover, as permitted by Delaware law, our Certificate of Incorporation contains a provision that renounces our expectation to certain corporate opportunities that are presented to our current and future directors that serve in capacities with other entities. Accordingly, our directors and officers may not present otherwise attractive business or acquisition opportunities to us of which they may become aware.
Approximately $927.2 million, representing 52.0% of DBMG’s backlog at December 31, 2022, was attributable to five contracts, letters of intent, notices to proceed or purchase orders.
Approximately $487.3 million, representing 46.1% of DBMG’s backlog at December 31, 2023, was attributable to five contracts, letters of intent, notices to proceed or purchase orders.
Although we believe that these charter and bylaw provisions, and provisions of Delaware law, provide an opportunity for the board to assure that our stockholders realize full value for their investment, they could have the effect of delaying or preventing a change of control, even under circumstances that some stockholders may consider beneficial. 32 Actions of activist stockholders, including a proxy contest, could be disruptive and potentially costly and the possibility that activist stockholders may contest, or seek changes that conflict with, our strategic direction could cause uncertainty about the strategic direction of our business.
Although we believe that these charter and bylaw provisions, and provisions of Delaware law, provide an opportunity for the board to assure that our stockholders realize full value for their investment, they could have the effect of delaying or preventing a change of control, even under circumstances that some stockholders may consider beneficial.
In the course of their other business activities, certain of our current and future directors and officers may become aware of business and acquisition opportunities that may be appropriate for presentation to us as well as the other entities with which they are affiliated.
In addition, such parties may have an interest in certain transactions such as strategic partnerships or joint ventures in which we are involved, and may also compete with us. 26 In the course of their other business activities, certain of our current and future directors and officers may become aware of business and acquisition opportunities that may be appropriate for presentation to us as well as the other entities with which they are affiliated.
If we dispose of or otherwise exit certain businesses, there can be no assurance that we will not incur certain disposition related charges, or that we will be able to reduce overhead related to the divested assets. 29 In the ordinary course of our business, we evaluate the potential disposition of assets and businesses that may no longer help us meet our objectives or that no longer fit with our broader strategy, such as the dispositions of our Clean Energy and Insurance segments in 2021 or the acquisition of Banker Steel by our Infrastructure segment in 2021.
In the ordinary course of our business, we evaluate the potential disposition of assets and businesses that may no longer help us meet our objectives or that no longer fit with our broader strategy, such as the dispositions of our Clean Energy and Insurance segments in 2021 or the acquisition of Banker Steel by our Infrastructure segment in 2021.
DBMG’s fabrication business often involves working around and with volatile, toxic and hazardous substances and other highly regulated pollutants, substances or wastes, for which the improper characterization, handling or disposal could constitute violations of U.S. federal, state or local laws and regulations and laws of other countries, and result in criminal and civil liabilities.
DBMG is subject to environmental laws and regulations, including those concerning emissions into the air, discharge into waterways, generation, storage, handling, treatment and disposal of waste materials and health and safety. 36 DBMG’s fabrication business often involves working around and with volatile, toxic and hazardous substances and other highly regulated pollutants, substances or wastes, for which the improper characterization, handling or disposal could constitute violations of U.S. federal, state or local laws and regulations and laws of other countries, and result in criminal and civil liabilities.
Our decision to make a particular acquisition, sell a particular asset or increase or decrease a particular investment may be based on considerations other than the timing and amount of taxes owed as a result thereof. We may remain liable for certain tax obligations of certain disposed companies, and we may be required to make material payments in connection therewith.
Our decision to make a particular acquisition, sell a particular asset or increase or decrease a particular investment may be based on considerations other than the timing and amount of taxes owed as a result thereof.
In connection with the historical operation of our facilities, substances which currently are or might be considered hazardous may have been used or disposed of at some sites in a manner that may require us to make expenditures for remediation. 37 The environmental, health and safety laws and regulations to which DBMG is subject are constantly changing, and it is impossible to predict the impact of such laws and regulations on DBMG in the future.
In connection with the historical operation of our facilities, substances which currently are or might be considered hazardous may have been used or disposed of at some sites in a manner that may require us to make expenditures for remediation.
These risks could be exacerbated by Pansend’s limited experience as an entity with large-scale commercial manufacturing. As demand for Pansend’s products increases, Pansend will have to invest additional resources to purchase raw materials and components, sub-assemblies and materials, hire and train employees and enhance Pansend’s manufacturing processes.
As demand for Pansend’s products increases, Pansend will have to invest additional resources to purchase raw materials and components, sub-assemblies and materials, hire and train employees and enhance Pansend’s manufacturing processes.
The executive management teams that lead our subsidiaries are also highly experienced and possess extensive skills in their relevant industries. The ability to retain key personnel is important to our success and future growth.
Voigt served as Senior Managing Director of Investments of the Company and was involved with sourcing deals and capital raising for the Company. The executive management teams that lead our subsidiaries are also highly experienced and possess extensive skills in their relevant industries. The ability to retain key personnel is important to our success and future growth.
As of December 31, 2022, INNOVATE has 80,216,028 issued and 78,787,768 outstanding shares of its common stock, and 16,125 shares of Series A-3 and Series A-4 preferred stock issued and outstanding.
As of December 31, 2023, INNOVATE has 80,722,983 issued and 79,234,991 outstanding shares of its common stock, and 16,125 shares of Series A-3 and Series A-4 preferred stock issued and outstanding.
Conversion of the 2026 Convertible Notes will dilute the ownership interest of existing stockholders, including holders who had previously converted their Convertible Notes, or may otherwise depress the market price of our common stock. The conversion of some or all of INNOVATE's 2026 Convertible Notes will dilute the ownership interests of existing stockholders.
Conversion of the 2026 Convertible Notes will dilute the ownership interest of existing stockholders, including holders who had previously converted their Convertible Notes, or may otherwise depress the market price of our common stock. As of December 31, 2023, the holders of our 2026 Convertible Notes had rights to convert their notes into 12,126,046 shares of our common stock.
Cybersecurity attacks could also include attacks targeting sensitive data or the security, integrity and/or reliability of the hardware and software installed in products we use. We treat such cybersecurity risks seriously given these threats pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of our data.
We treat such cybersecurity risks seriously given these threats pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of our data.
If we fail to protect our intellectual property rights adequately, our competitors might gain access to our technology, and our business might be harmed. In addition, defending our intellectual property rights might entail significant expense. Any of our trademarks or other intellectual property rights may be challenged by others or invalidated through administrative process or litigation.
If we fail to protect our intellectual property rights adequately, including through the improper use of AI by our personnel or business partners, our competitors might gain access to our technology, and our business might be harmed. In addition, defending our intellectual property rights might entail significant expense.
Additionally, changes in U.S. social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently develop and sell products, and any negative sentiments towards the United States as a result of such changes, could adversely affect our business.
Violations of the FCPA, the Bribery Act, the rules and regulations established by OFAC and other laws, sanctions or regulations may result in severe criminal or civil penalties, and we may be subject to other liabilities, which could materially adversely affect our business, financial condition or results of operations. 28 Additionally, changes in U.S. social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently develop and sell products, and any negative sentiments towards the United States as a result of such changes, could adversely affect our business.
Any sales in the public market of the shares of our common stock issuable upon such conversion could adversely affect prevailing market prices of our common stock.
The conversion of some or all of our 2026 Convertible Notes will dilute the ownership interests of existing stockholders. Any sales in the public market of the shares of our common stock issuable upon such conversion could adversely affect prevailing market prices of our common stock.
As of December 31, 2022, we had approximately $226.3 million of federal net operating loss carryforwards (“NOLs”) and $169.2 million of Code Section 163(j) interest limitation carryforwards available to offset our future taxable income, which NOLs will begin to expire in 2034.
As of December 31, 2023, the U.S. consolidated group had approximately $179.2 million of federal NOL carryforwards and $211.7 million of Code Section 163(j) interest limitation carryforwards available to offset our future taxable income, which NOLs will begin to expire in 2034.
Disputes between us and partners may result in litigation or arbitration that would increase our costs and expenses and divert a substantial amount of management’s time and effort away from our businesses.
Disputes between us and partners may result in litigation or arbitration that would increase our costs and expenses and divert a substantial amount of management’s time and effort away from our businesses. We may also, in certain circumstances, be liable for the actions of our third-party partners which could have a material adverse effect on us.
Further, more stringent regulatory requirements or safety and quality standards may be issued in the future with an adverse effect on Pansend’s business. 40 Pansend’s customers, or physicians and technicians, as the case may be, may misuse certain of its products, and product liability lawsuits and other damages imposed on Pansend may have a material adverse impact on its business.
Pansend’s customers, or physicians and technicians, as the case may be, may misuse certain of its products, and product liability lawsuits and other damages imposed on Pansend may have a material adverse impact on its business. Pansend faces an inherent risk of product liability as a result of the marketing and sale of its products.
"Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources". 20 Claims of creditors of our subsidiaries generally will have priority as to the assets of such subsidiaries over our claims and claims of our creditors and stockholders.
Claims of creditors of our subsidiaries generally will have priority as to the assets of such subsidiaries over our claims and claims of our creditors and stockholders.
We may also, in certain circumstances, be liable for the actions of our third-party partners which could have a material adverse effect on us. 30 We and our subsidiaries rely on trademark, copyright, trade secret, contractual restrictions and patent rights to protect our intellectual property and proprietary rights and if these rights are impaired, then our ability to generate revenue and our competitive position may be harmed .
We and our subsidiaries rely on trademark, copyright, trade secret, contractual restrictions and patent rights to protect our intellectual property and proprietary rights and if these rights are impaired, then our ability to generate revenue and our competitive position may be harmed .

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe that our present administrative, technical and sales office facilities are adequate for our anticipated operations and that similar space can be obtained readily as needed.
Biggest changeDBMG is headquartered in Phoenix, Arizona; Spectrum is headquartered in New York, New York; R2 Technologies is headquartered in Dublin, California. We believe that our present administrative, technical and sales office facilities are adequate for our anticipated operations and that similar space can be obtained readily as needed.
ITEM 2. PROPERTIES Our corporate headquarters are located in New York, New York. We own select fabrication facilities, warehouses, administrative and sales offices and lease administrative, technical and sales office space in various locations in the countries in which we operate. DBMG is headquartered in Phoenix, Arizona; Broadcasting is headquartered in New York, New York.
ITEM 2. PROPERTIES Our corporate headquarters are located in New York, New York. We own select fabrication facilities, warehouses, administrative and sales offices and lease administrative, technical and sales office space in various locations in the countries in which we operate.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS The information set forth in Note 15. Commitments and Contingencies in the notes to the audited consolidated financial statements in Item 8 of this Form 10-K is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS The information regarding legal proceedings as set forth in Note 13. Commitments and Contingencies in the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDuring fiscal year 2022, we withheld 39,044 shares at an average price per share of $0.75 as payment of withholding taxes in connection with the vesting and exercise of equity awards. For information about our equity compensation plans, see Part III, Item 11, below. ITEM 6. [RESERVED] 45
Biggest changeDuring the fourth quarter of 2023, there were no shares withheld for taxes. During the year ended December 31, 2023, we withheld 59,732 shares at an average price per share of $2.94 as payment of withholding taxes in connection with the vesting of employee equity awards.
The payment of dividends on common stock, if any, in the future is within the discretion of the INNOVATE Board of Directors and will depend on our earnings, our capital requirements, financial condition, the ability to comply with the requirements of the law and agreements governing our and our subsidiaries indebtedness.
The payment of dividends on common stock, if any, in the future is within the discretion of our board of directors and will depend on our earnings, our capital requirements, financial condition, the ability to comply with the requirements of the law and agreements governing our and our subsidiaries indebtedness.
The Secured Indentures of certain of our debt instruments contain covenants that, among other things, limit or restrict our ability to make certain restricted payments, including the payment of cash dividends with respect to INNOVATE’s common stock. The DBMG Facility contains similar covenants applicable to DBMG. Refer to Item 7.
The secured indentures governing certain of our debt instruments contain covenants that, among other things, limit or restrict our ability to make certain restricted payments, including the payment of cash dividends with respect to our common stock. The DBMG Facility contains similar covenants applicable to DBMG. Refer to Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources and Note 13. Debt Obligations to our Consolidated Financial Statements included in the Annual Report on Form 10-K for more detail concerning our Secured Notes and other financing arrangements. Moreover, dividends may be restricted by other arrangements entered into in the future by us.
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources and Note 11. Debt Obligations to our Consolidated Financial Statements included in this Annual Report on Form 10-K for more detail concerning our Secured Notes and other financing arrangements. Moreover, dividends may be restricted by other arrangements entered into in the future by us.
For details on preferred share dividends refer to Note 18. Temporary Equity and Equity in the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
For details on preferred share dividends refer to Note 16. Temporary Equity and Equity in the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
This number does not include stockholders for whom shares were held in "nominee" or "street" name. 44 Dividends INNOVATE paid no dividends on its common stock in 2022 or 2021, and the INNOVATE Board of Directors has no current intention of paying any dividends on INNOVATE common stock in the near future.
This number does not include stockholders for whom shares were held in "nominee" or "street" name. 45 Dividends INNOVATE paid no dividends on its common stock in 2023 or 2022, and our board of directors has no current intention of paying any dividends on our common stock in the near future.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock INNOVATE common stock trades on the NYSE under the ticker symbol "VATE". Holders of Common Stock As of December 31, 2022, INNOVATE had approximately 50 holders of record of its common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock INNOVATE common stock trades on the NYSE under the ticker symbol "VATE". Holders of Common Stock As of February 29, 2024, INNOVATE had approximately 48 holders of record of its common stock.
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Information regarding our equity compensation plans will be set forth in our 2024 Proxy Statement and is incorporated herein by reference. ITEM 6. [RESERVED] 46

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest change(in millions) Year ended December 31, 2022 Infrastructure Life Sciences Spectrum Non-operating Corporate Other and Eliminations INNOVATE Net income (loss) attributable to INNOVATE Corp., excluding discontinued operations $ 29.2 $ (19.2) $ (13.3) $ (35.3) $ 2.7 $ (35.9) Adjustments to reconcile net income (loss) to Adjusted EBITDA: Depreciation and amortization 21.0 0.3 5.8 0.1 — 27.2 Depreciation and amortization (included in cost of revenue) 15.0 — — — — 15.0 Other operating (income) loss (0.6) — 1.3 — — 0.7 Interest expense 10.1 0.8 7.4 33.7 — 52.0 Other (income) expense, net (1.0) 0.4 3.9 (1.9) (0.2) 1.2 Income tax expense (benefit) 16.5 — (0.1) (16.2) 0.7 0.9 Noncontrolling interest 2.8 (8.2) (1.9) — 1.2 (6.1) Share-based compensation expense — 0.5 — 1.9 — 2.4 Restructuring and exit costs 6.5 — 0.7 — — 7.2 Acquisition and disposition costs 2.2 — 0.7 1.0 (0.4) 3.5 Adjusted EBITDA $ 101.7 $ (25.4) $ 4.5 $ (16.7) $ 4.0 $ 68.1 54 (in millions) Year ended December 31, 2021 Infrastructure Life Sciences Spectrum Non-operating Corporate Other and Eliminations INNOVATE Net loss attributable to INNOVATE Corp. $ (227.5) Less: Discontinued operations (149.9) Net income (loss) attributable to INNOVATE Corp., excluding discontinued operations $ 16.9 $ (19.8) $ (12.9) $ (64.2) $ 2.4 $ (77.6) Adjustments to reconcile net income (loss) to Adjusted EBITDA: Depreciation and amortization 19.1 0.2 6.0 0.1 — 25.4 Depreciation and amortization (included in cost of revenue) 12.2 — — — — 12.2 Other operating loss 0.4 — 0.2 — — 0.6 Interest expense 8.5 — 9.2 41.4 — 59.1 Other (income) expense, net (4.0) — 3.9 (4.2) — (4.3) Loss on extinguishment of debt 1.5 — 1.0 10.0 — 12.5 Income tax expense (benefit) 10.5 — 0.3 (6.1) 0.9 5.6 Noncontrolling interest 1.8 (8.2) (2.3) — — (8.7) Share-based compensation expense — 0.2 0.6 1.6 — 2.4 Nonrecurring items 0.5 — — 0.5 — 1.0 COVID-19 costs 8.6 — — — — 8.6 Acquisition and disposition costs 2.4 — 0.9 2.9 0.9 7.1 Adjusted EBITDA $ 78.4 $ (27.6) $ 6.9 $ (18.0) $ 4.2 $ 43.9 Infrastructure: Net income from our Infrastructure segment for the year ended December 31, 2022 increased $12.3 million to $29.2 million from $16.9 million for the year ended December 31, 2021.
Biggest changeThe calculation of Adjusted EBITDA, as defined by us, consists of Net income (loss) attributable to INNOVATE Corp., excluding: discontinued operations, if applicable; depreciation and amortization; other operating (income) loss, which is inclusive of (gain) loss on sale or disposal of assets, lease termination costs, asset impairment expense and FCC reimbursements; interest expense; other (income) expense, net; income tax expense (benefit); non-controlling interest; share-based compensation expense; legacy accounts receivable expense; restructuring and exit costs; and acquisition and disposition costs. 56 (in millions) Year ended December 31, 2023 Infrastructure Life Sciences Spectrum Non-Operating Corporate Other and Eliminations INNOVATE Net income (loss) attributable to INNOVATE Corp. $ 28.7 $ (15.5) $ (22.2) $ (33.2) $ 7.0 $ (35.2) Adjustments to reconcile net income (loss) to Adjusted EBITDA: Depreciation and amortization 14.4 0.5 5.2 0.1 — 20.2 Depreciation and amortization (included in cost of revenue) 15.7 0.1 — — — 15.8 Other operating (income) loss (0.2) — (0.1) 0.5 1.1 1.3 Interest expense 13.8 2.9 13.4 38.1 — 68.2 Other (income) expense, net (1.2) (4.1) 7.7 (6.7) (12.4) (16.7) Income tax expense (benefit) 20.2 — 0.3 (14.8) (1.2) 4.5 Non-controlling interest 2.8 (7.3) (2.5) — 3.3 (3.7) Share-based compensation expense — 0.2 — 2.0 — 2.2 Legacy accounts receivable expense 2.2 — — — — 2.2 Restructuring and exit costs 2.1 — 0.1 — — 2.2 Acquisition and disposition costs 2.1 0.1 0.1 0.5 1.2 4.0 Adjusted EBITDA $ 100.6 $ (23.1) $ 2.0 $ (13.5) $ (1.0) $ 65.0 (in millions) Year ended December 31, 2022 Infrastructure Life Sciences Spectrum Non-Operating Corporate Other and Eliminations INNOVATE Net income (loss) attributable to INNOVATE Corp. $ 29.2 $ (19.2) $ (13.3) $ (35.3) $ 2.7 $ (35.9) Adjustments to reconcile net income (loss) to Adjusted EBITDA: Depreciation and amortization 21.0 0.3 5.8 0.1 — 27.2 Depreciation and amortization (included in cost of revenue) 15.0 — — — — 15.0 Other operating (income) loss (0.6) — 1.3 — — 0.7 Interest expense 10.1 0.8 7.4 33.7 — 52.0 Other (income) expense, net (1.0) 0.4 3.9 (1.9) (0.2) 1.2 Income tax expense (benefit) 16.5 — (0.1) (16.2) 0.7 0.9 Non-controlling interest 2.8 (8.2) (1.9) — 1.2 (6.1) Share-based compensation expense — 0.5 — 1.9 — 2.4 Restructuring and exit costs 6.5 — 0.7 — — 7.2 Acquisition and disposition costs 2.2 — 0.7 1.0 (0.4) 3.5 Adjusted EBITDA $ 101.7 $ (25.4) $ 4.5 $ (16.7) $ 4.0 $ 68.1 57 Adjusted EBITDA by segment is summarized as follows: (in millions): Year Ended December 31, 2023 2022 Increase / (Decrease) Infrastructure $ 100.6 $ 101.7 $ (1.1) Life Sciences (23.1) (25.4) 2.3 Spectrum 2.0 4.5 (2.5) Non-Operating Corporate (13.5) (16.7) 3.2 Other and Eliminations (1.0) 4.0 (5.0) Adjusted EBITDA $ 65.0 $ 68.1 $ (3.1) Infrastructure: Net income from our Infrastructure segment for the year ended December 31, 2023 decreased $0.5 million to $28.7 million from $29.2 million for the year ended December 31, 2022.
Although the Company believes, to the extent needed, that it will be able to raise additional debt or equity capital, refinance indebtedness or preferred stock, enter into other financing arrangements or engage in asset sales and sales of certain investments sufficient to fund any cash needs that we are not able to satisfy with the funds on hand or expected to be provided by our subsidiaries, there can be no assurance that it will be able to do so on terms satisfactory to the Company, if at all.
Although the Company believes that it will be able, to the extent needed, to raise additional debt or equity capital, refinance indebtedness or preferred stock, enter into other financing arrangements or engage in asset sales and sales of certain investments sufficient to fund any cash needs that we are not able to satisfy with the funds on hand or expected to be provided by our subsidiaries, there can be no assurance that it will be able to do so on terms satisfactory to the Company, if at all.
The maintenance of liquidity covenant provides that the Company will not permit the aggregate amount of (i) all unrestricted cash and Cash Equivalents of the Company and the Subsidiary Guarantors, (ii) amounts available for drawing under revolving credit facilities and undrawn letters of credit of the Company and the Subsidiary Guarantors and (iii) dividends, distributions or payments that are immediately available to be paid to the Company by any of its Restricted Subsidiaries to be less than the Company’s obligation to pay interest on the 2026 Senior Secured Notes and all other Debt, including Convertible Preferred Stock mandatory cash dividends or any other mandatory cash pay Preferred Stock but excluding any obligation to pay interest on Convertible Preferred Stock or any other mandatory cash pay Preferred Stock which, in each case, may be paid by accretion or in-kind in accordance with its terms of the Company and its Subsidiary Guarantors for the next six months.
The maintenance of liquidity covenant provides that the Company will not permit the aggregate amount of (i) all unrestricted cash and Cash Equivalents of the Company and the Subsidiary Guarantors, (ii) amounts available for drawing under revolving credit facilities and undrawn letters of credit of the Company and the Subsidiary Guarantors and (iii) dividends, distributions or payments that are immediately available to be paid to the Company by any of its Restricted Subsidiaries to be less than the Company’s obligation to pay interest for the next six months on the 2026 Senior Secured Notes and all other Debt, including Convertible Preferred Stock mandatory cash dividends or any other mandatory cash pay Preferred Stock but excluding any obligation to pay interest on Convertible Preferred Stock or any other mandatory cash payments on Preferred Stock which, in each case, may be paid by accretion or in-kind in accordance with its terms of the Company and its Subsidiary Guarantors.
The Company has conducted its operations in a manner that resulted in compliance with the Secured Indenture; however, compliance with certain financial covenants for future periods may depend on the Company or one or more of the Company’s subsidiaries undertaking one or more non-operational transactions, such as the management of operating cash outflows, a monetization of assets, a debt incurrence or refinancing, the raising of equity capital, or similar transactions.
The Company has conducted its operations in a manner that has resulted in compliance with the Secured Indenture; however, compliance with certain financial covenants for future periods may depend on the Company or one or more of the Company’s subsidiaries undertaking one or more non-operational transactions, such as the management of operating cash outflows, a monetization of assets, a debt incurrence or refinancing, the raising of equity capital, or similar transactions.
Our actual results or other outcomes of Broadcasting, and, thus, our Spectrum segment, may differ from those expressed or implied by forward-looking statements contained herein due to a variety of important factors, including, without limitation, the following: • our Spectrum segment’s ability to operate in highly competitive markets and maintain market share; • our Spectrum segment’s ability to effectively implement its business strategy or be successful in the operation of its business; • our Spectrum's segment possible inability to raise additional capital when needed or refinance its existing debt, on attractive terms, or at all; • new and growing sources of competition in the broadcasting industry; and • FCC regulation of the television broadcasting industry.
Our actual results or other outcomes of Broadcasting, and, thus, our Spectrum segment, may differ from those expressed or implied by forward-looking statements contained herein due to a variety of important factors, including, without limitation, the following: • our Spectrum segment’s ability to operate in highly competitive markets and maintain market share; • our Spectrum segment’s ability to effectively implement its business strategy or be successful in the operation of its business; • our Spectrum segment's possible inability to raise additional capital when needed or refinance its existing debt, on attractive terms, or at all; • new and growing sources of competition in the broadcasting industry; and • FCC regulation of the television broadcasting industry.
Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details regarding the indebtedness of our Life Sciences and Spectrum segments. Restrictive Covenants The indenture governing the 2026 Senior Secured Notes dated February 1, 2021, by and among INNOVATE, the guarantors party thereto and U.S.
Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K for additional details regarding the indebtedness of our Infrastructure, Life Sciences and Spectrum segments. Restrictive Covenants The indenture governing the 2026 Senior Secured Notes dated February 1, 2021, by and among INNOVATE, the guarantors party thereto and U.S.
These estimates impacting fair value could materially differ if unanticipated events impacting inputs to the fair value such as the risk free or volatility rates unfold differently than anticipated. Income Taxes Our annual tax rate is based on our income, statutory tax rates, exchange rates and tax planning opportunities available to us in the various jurisdictions in which we operate.
These estimates impacting fair value could materially differ if unanticipated events impacting inputs to the fair value such as the risk free or volatility rates unfold differently than anticipated. 65 Income Taxes Our annual tax rate is based on our income, statutory tax rates, exchange rates and tax planning opportunities available to us in the various jurisdictions in which we operate.
Bank, as trustee (the "Convertible Indenture"). The 2026 Convertible Notes mature on August 1, 2026 unless earlier converted, redeemed or purchased. The 2026 Convertible Notes accrue interest at a rate of 7.5% per year, which interest is paid semi-annually on February 1 and August 1 of each year.
Bank, as trustee (the "Convertible Indenture"). The 2026 Convertible Notes mature on August 1, 2026 unless earlier converted, redeemed or purchased. The 2026 Convertible Notes accrue interest at a rate of 7.5% per year, which interest is paid semi-annually on February 1 st and August 1 st of each year.
We have financed our growth and operations to date, and expect to finance our future growth and operations, through public offerings and private placements of debt and equity securities, credit facilities, vendor financing, capital lease financing and other financing arrangements, as well as cash generated from the operations of our subsidiaries.
We have financed our growth and operations to date, and expect to finance our future growth and operations, through public offerings and private placements of debt and equity securities, credit facilities, vendor financing, finance lease financing and other financing arrangements, as well as cash generated from the operations of our subsidiaries.
The $52.2 million of Senior Secured Notes consisted of $19.3 million of 8.5% Senior Secured Notes and $32.9 million of 10.5% Senior Secured Notes. The other terms of the $19.3 million 8.5% Senior Notes remained the same. At the time of the extension, HC2 Broadcasting had accrued interest and other fees $6.9 million.
The $52.2 million of Senior Secured Notes consisted of $19.3 million of 8.5% Senior Secured Notes and $32.9 million of 10.5% Senior Secured Notes. The other terms of the $19.3 million 8.5% Senior Notes remained the same. At the time of the extension, Broadcasting had accrued interest and other fees of $6.9 million.
Our actual results or other outcomes of DBMG, and, thus, our Infrastructure segment, may differ from those expressed or implied by forward-looking statements contained herein due to a variety of important factors, including, without limitation, the following: • adverse impacts from weather affecting DBMG’s performance and timeliness of completion of projects, which could lead to increased costs and affect the quality, costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors; • our ability to maintain efficient staffing and productivity as well as delays and cancellations as a result of the COVID-19 pandemic; • cost overruns on fixed-price or similar contracts or failure to receive timely or proper payments on cost-reimbursable contracts, whether as a result of improper estimates, performance, disputes, or otherwise; • uncertain timing and funding of new contract awards, as well as project cancellations; • potential impediments and limitations on our ability to complete ordinary course acquisitions in anticipated time frames or at all; • changes in the costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors; • the impact of inflationary pressures; • adverse outcomes of pending claims or litigation or the possibility of new claims or litigation, and the potential effect of such claims or litigation on DBMG’s business, financial condition, results of operations or cash flow; • risks associated with labor productivity, including performance of subcontractors that DBMG hires to complete projects; • its ability to realize cost savings from expected performance of contracts, whether as a result of improper estimates, performance, or otherwise; • its ability to settle or negotiate unapproved change orders and claims; • fluctuating revenue resulting from a number of factors, including the cyclical nature of the individual markets in which our customers operate; • our possible inability to raise additional capital when needed or refinance our existing debt, on attractive terms, or at all; and • lack of necessary liquidity to provide bid, performance, advance payment and retention bonds, guarantees, or letters of credit securing DBMG’s obligations under bids and contracts or to finance expenditures prior to the receipt of payment for the performance of contracts.
Our actual results or other outcomes of DBMG, and, thus, our Infrastructure segment, may differ from those expressed or implied by forward-looking statements contained herein due to a variety of important factors, including, without limitation, the following: • adverse impacts from weather affecting DBMG’s performance and timeliness of completion of projects, which could lead to increased costs and affect the quality, costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors; • cost overruns on fixed-price or similar contracts or failure to receive timely or proper payments on cost-reimbursable contracts, whether as a result of improper estimates, performance, disputes, or otherwise; • uncertain timing and funding of new contract awards, as well as project cancellations; • potential impediments and limitations on our ability to complete ordinary course acquisitions in anticipated time frames or at all; • changes in the costs or availability of, or delivery schedule for, equipment, components, materials, labor or subcontractors; • the impact of inflationary pressures; • adverse outcomes of pending claims or litigation or the possibility of new claims or litigation, and the potential effect of such claims or litigation on DBMG’s business, financial condition, results of operations or cash flow; • risks associated with labor productivity, including performance of subcontractors that DBMG hires to complete projects; • its ability to realize cost savings from expected performance of contracts, whether as a result of improper estimates, performance, or otherwise; • its ability to settle or negotiate unapproved change orders and claims; • fluctuating revenue resulting from a number of factors, including the cyclical nature of the individual markets in which our customers operate; • our possible inability to raise additional capital when needed or refinance our existing debt, on attractive terms, or at all; and • lack of necessary liquidity to provide bid, performance, advance payment and retention bonds, guarantees, or letters of credit securing DBMG’s obligations under bids and contracts or to finance expenditures prior to the receipt of payment for the performance of contracts.
As of December 31, 2022, the Company was in compliance with this covenant. The instruments governing the Company’s Preferred Stock also limit the Company’s and its subsidiaries ability to take certain actions, including, among other things, to incur additional indebtedness; issue additional Preferred Stock; engage in transactions with affiliates; and make certain restricted payments.
As of December 31, 2023, the Company was in compliance with this covenant. The instruments governing the Company’s Preferred Stock also limit the Company’s and its subsidiaries ability to take certain actions, including, among other things, to incur additional indebtedness; issue additional Preferred Stock; engage in transactions with affiliates; and make certain restricted payments.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations together with the information in our consolidated annual audited financial statements and the notes thereto, each of which are contained in Item 8. entitled "Financial Statements and Supplementary Data," and other financial information included herein.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated annual financial statements and the notes thereto, each of which are contained in Item 8. entitled "Financial Statements and Supplementary Data," and other financial information included herein.
Project schedules, particularly in connection with large, complex, and longer-term projects can also create fluctuations in the services provided, which may adversely affect us in a given period.
Project schedules, particularly in connection with large, complex, and longer-term projects can also create fluctuations in the services provided, which may adversely affect us in any given period.
The 2026 Senior Secured Notes mature on February 1, 2026, and accrue interest at a rate of 8.50% per year, which interest is paid semi-annually on February 1 and August 1 of each year. For additional information on the terms and conditions of the 2026 Senior Secured Notes, including guarantees, ranking and collateral, refer to Note 13.
The 2026 Senior Secured Notes mature on February 1, 2026, and accrue interest at a rate of 8.50% per year, which interest is paid semi-annually on February 1 st and August 1 st of each year. For additional information on the terms and conditions of the 2026 Senior Secured Notes, including guarantees, ranking and collateral, refer to Note 11.
Total outstanding principal after the refinancing was $69.7 million and $6.9 million of accrued interest and fees remain accrued, with total exit fees of $7.6 million which were recorded as original issue discount with a corresponding liability reflected in Other Liabilities. Interest is capitalized and payable upon maturity of the principal.
Total outstanding principal after the refinancing was $69.7 million, and $6.9 million of accrued interest and fees remain accrued, with total exit fees of $7.6 million which were recorded as original issue discount with a corresponding liability reflected in Other Liabilities in the Consolidated Balance Sheet. Interest is capitalized and payable upon maturity of the principal.
On August 2, 2022, DBMG negotiated and finalized an amendment to its UMB Revolving Line which included a retrospective change to the terms of the Fixed Coverage Ratio, and an increase in the UMB Revolving Line commitment from $110.0 million to $135.0 million, among other things. Refer to Note 13.
On August 2, 2022, DBMG negotiated and finalized an amendment to its UMB Revolving Line which included a retrospective change to the terms of the Fixed Coverage Ratio, and an increase in the UMB Revolving Line commitment from $110.0 million to $135.0 million, among other things.
Debt Obligations to our Consolidated Financial Statements included in this Annual Report on Form 10-K and future financing agreements on our ability to operate our business and finance our pursuit of acquisition opportunities; • the effect of the novel coronavirus (“COVID-19”) pandemic and related governmental responses on our business, financial condition and results of operations; • our possible inability to generate sufficient liquidity, margins, earnings per share, cash flow and working capital from our operating segments; • our dependence on certain key personnel; • our possible inability to hire and retain qualified executive management, sales, technical and other personnel; • the potential for, and our ability to, remediate future material weaknesses in our internal controls over financial reporting; • the impact of recent supply chain disruptions, labor shortages and increases in overall price levels, including in transportation costs; • the impact of a higher interest rate environment; • the effects related to or resulting from Russia's military action in Ukraine, including the imposition of additional sanctions and export controls, as well as the broader impact to financial markets and the global macroeconomic and geopolitical environment; • increased competition in the markets in which our operating segments conduct their businesses; • limitations on our ability to successfully identify any strategic acquisitions or business opportunities and to compete for these opportunities with others who have greater resources; • our ability to effectively increase the size of our organization, if needed, and manage our growth • the impact of expending significant resources in considering acquisition targets or business opportunities that are not consummated; • our expectations and timing with respect to our ordinary course acquisition activity and whether such acquisitions are accretive or dilutive to stockholders; • the effect any interests our officers, directors, stockholders and their respective affiliates may have in certain transactions in which we are involved • uncertain global economic conditions in the markets in which our operating segments conduct their businesses; • the impact of catastrophic events, including natural disasters, pandemic illness and the outbreak of war, or acts of terrorism; • potential impacts on our business resulting from climate change, greenhouse gas regulations, and the impact of climate change-related changes in the frequency and severity of weather patterns; • the impact of additional material charges associated with our oversight of acquired or target businesses and the integration of our financial reporting; • tax consequences associated with our acquisition, holding and disposition of target companies and assets; • our ability to remain in compliance with the listing standards of the New York Stock Exchange; • the ability of our operating segments to attract and retain customers; • our expectations regarding the timing, extent and effectiveness of our cost reduction initiatives and management’s ability to moderate or control discretionary spending; • management’s plans, goals, forecasts, expectations, guidance, objectives, strategies and timing for future operations, acquisitions, synergies, asset dispositions, fixed asset and goodwill impairment charges, tax and withholding expense, selling, general and administrative expenses, product plans, performance and results; • management’s assessment of market factors and competitive developments, including pricing actions and regulatory rulings; • our expectations and timing with respect to any strategic dispositions and sales of our operating subsidiaries, or businesses, including the anticipated wind-down of our Network business by our Spectrum segment, that we may make in the future and the effect of any such dispositions or sales on our results of operations; • the possibility of indemnification claims arising out of divestitures of businesses; and • our possible inability to raise additional capital when needed or refinance our existing debt, on attractive terms, or at all. 64 Infrastructure / DBM Global Inc.
Debt Obligations to our Consolidated Financial Statements included in this Annual Report on Form 10-K and future financing agreements on our ability to operate our business and finance our pursuit of acquisition opportunities; • our possible inability to generate sufficient liquidity, margins, earnings per share, cash flow and working capital from our operating segments; • our dependence on certain key personnel; • bank failures or other similar events that could adversely affect our and our customers' and vendors' liquidity and financial performance; • our possible inability to hire and retain qualified executive management, sales, technical and other personnel; • the potential for, and our ability to, remediate future material weaknesses in our internal controls over financial reporting; • the impact of recent supply chain disruptions, labor shortages and increases in overall price levels, including in transportation costs; • the impact of a higher interest rate environment; • the effects related to or resulting from military actions in Israel and the Gaza Strip and Russia's military action in Ukraine, including the imposition of additional sanctions and export controls, as well as the broader impact to financial markets and the global macroeconomic and geopolitical environment; • increased competition in the markets in which our operating segments conduct their businesses; • limitations on our ability to successfully identify any strategic acquisitions or business opportunities and to compete for these opportunities with others who have greater resources; • our ability to effectively increase the size of our organization, if needed, and manage our growth; • the impact of expending significant resources in considering acquisition targets or business opportunities that are not consummated; • our expectations and timing with respect to our ordinary course acquisition activity and whether such acquisitions are accretive or dilutive to stockholders; • the effect any interests our officers, directors, stockholders and their respective affiliates may have in certain transactions in which we are involved; • uncertain global economic conditions in the markets in which our operating segments conduct their businesses; • the impact of catastrophic events, including natural disasters, pandemic illness and the outbreak of war, or acts of terrorism; • potential impacts on our business resulting from climate change, greenhouse gas regulations, and the impact of climate change-related changes in the frequency and severity of weather patterns; • the impact of additional material charges associated with our oversight of acquired or target businesses and the integration of our financial reporting; • tax consequences associated with our acquisition, holding and disposition of target companies and assets; • our ability to remain in compliance with the listing standards of the New York Stock Exchange; • the ability of our operating segments to attract and retain customers; • our expectations regarding the timing, extent and effectiveness of our cost reduction initiatives and management’s ability to moderate or control discretionary spending; • management’s plans, goals, forecasts, expectations, guidance, objectives, strategies and timing for future operations, acquisitions, synergies, asset dispositions, fixed asset and goodwill impairment charges, tax and withholding expense, selling, general and administrative expenses, product plans, performance and results; • management’s assessment of market factors and competitive developments, including pricing actions and regulatory rulings; • our expectations and timing with respect to any strategic dispositions and sales of our operating subsidiaries, or businesses, including the shut-down of our Network business by our Spectrum segment, that we may make in the future and the effect of any such dispositions or sales on our results of operations; • the possibility of indemnification claims arising out of divestitures of businesses; and • our possible inability to raise additional capital when needed or refinance our existing debt, on attractive terms, or at all. 68 Infrastructure / DBM Global Inc.
Our subsidiaries' principal liquidity requirements arise from cash used in operating activities, debt service, and capital expenditures, including purchases of steel construction equipment, over-the-air ("OTA") broadcast station equipment, development of back-office systems, operating costs and expenses, and income taxes.
Our subsidiaries' principal liquidity requirements arise from cash used in operating activities, debt service, and capital expenditures, including purchases of steel construction equipment, OTA broadcast station equipment, development of back-office systems, operating costs and expenses, and income taxes.
Our off-balance sheet transactions may include, but are not limited to: leases that have not yet commenced, liabilities associated with non-cancelable operating leases with durations of less than twelve months, letter of credit obligations, surety, perfo rmance or payment bonds entered into in the normal course of business, and liabilities associated with multi-employer pension plans. Refer to Note 11.
Our off-balance sheet transactions may include, but are not limited to: leases that have not yet commenced, short-term leases, liabilities associated with non-cancelable operating leases with durations of less than twelve months, letter of credit obligations, surety, perfo rmance or payment bonds entered into in the normal course of business, and liabilities associated with multi-employer pension plans.
If one or more of these projects terminate or reduce their scope, DBMG’s backlog could decrease substantially. DBMG includes an additional $10.4 million in its backlog that is not included in the remaining unsatisfied performance obligations disclosed in Note 3. Revenue and Contracts in Process.
If one or more of these projects terminate or reduce their scope, DBMG’s backlog could decrease substantially. DBMG includes an additional $15.0 million in its backlog that is not included in the remaining unsatisfied performance obligations disclosed in Note 3. Revenue and Contracts in Process.
Total outstanding principal after the refinancing was $69.7 million and $6.9 million of accrued interest and fees remain accrued, with total exit fees of $7.6 million which were recorded as original issue discount with a corresponding liability reflected in Other Liabilities. Interest is accrued and payable upon maturity of the principal.
Total outstanding principal after the refinancing was $69.7 million, and $6.9 million of accrued interest and fees remain accrued, with total exit fees of $7.6 million which were recorded as original issue discount with a corresponding liability reflected in Other Liabilities in the Consolidated Balance Sheet. Interest is capitalized and payable upon maturity of the principal.
Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference. 2026 Convertible Notes - Terms and Conditions As of December 31, 2022, we had $51.8 million 2026 Convertible Notes outstanding. The 2026 Convertible Notes were issued under a separate indenture dated February 1, 2021, between the Company and U.S.
Debt Obligations included in this Annual Report on Form 10-K, which is incorporated herein by reference. 2026 Convertible Notes - Terms and Conditions As of December 31, 2023, we had $51.8 million 2026 Convertible Notes outstanding. The 2026 Convertible Notes were issued under a separate indenture dated February 1, 2021, between the Company and U.S.
GAAP requires the use of estimates and assumptions that have an impact on the assets, liabilities, revenue and expense amounts reported. These estimates can also affect supplemental disclosures including information about contingencies, risk and financial condition.
Generally Accepted Accounting Principles ("GAAP") requires the use of estimates and assumptions that have an impact on the assets, liabilities, revenue and expense amounts reported. These estimates can also affect supplemental disclosures, including information about contingencies, risk and financial condition.
Liquidity and Capital Resources Short- and Long-Term Liquidity Considerations and Risks Our Non-Operating Corporate segment consists of holding companies, and its liquidity needs are primarily for interest payments on its 2026 Senior Secured Notes, 2026 Convertible Notes and Revolving Credit Agreement, dividend payments on its Preferred Stock and recurring operational expenses.
Liquidity and Capital Resources Short- and Long-Term Liquidity Considerations and Risks Our Non-Operating Corporate segment consists of holding companies, and its liquidity needs are primarily for interest payments on its 2026 Senior Secured Notes, 2026 Convertible Notes, Revolving Line of Credit, CGIC Unsecured Note, and dividend payments on its Preferred Stock and recurring operational expenses.
Concurrently therewith and as part of the consideration for extending the 10.5% Senior Notes, HC2 Broadcasting amended warrants to purchase 145,825 shares of common stock of HC2 Broadcasting Holdings, Inc., or approximately 12% of diluted equity, held by the lenders of the 10.5% Senior Notes by extending the time to exercise such to the second half of 2026 and reducing the exercise price per share (i) from $140.00 to $0.01 in the case of the certain of the warrants and (ii) from $130.00 to $0.01 in the case of the remaining warrants.
Concurrently therewith and as part of the consideration for extending the 10.5% Senior Notes in December 2022, Broadcasting amended warrants to purchase 145,825 shares of common stock of HC2 Broadcasting Holdings, Inc. common stock held by the lenders of the 10.5% Senior Notes by extending the time to exercise such to the second half of 2026 and reducing the exercise price per share (i) from $140.00 to $0.01 in the case of the certain of the warrants and (ii) from $130.00 to $0.01 in the case of the remaining warrants.
Concurrently therewith and as part of the consideration for extending the 10.5% Senior Notes, HC2 Broadcasting amended warrants to purchase 145,825 shares of common stock of HC2 Broadcasting Holdings, Inc., or approximately 12% of diluted equity, held by the lenders of the 10.5% Senior Notes by extending the time to exercise such to the second half of 2026 and reducing the exercise price per share (i) from $140.00 to $0.01 in the case of the certain of the warrants and (ii) from $130.00 to $0.01 in the case of the remaining warrants.
Concurrently therewith and as part of the consideration for extending the 10.5% Senior Notes in December 2022, Broadcasting amended warrants to purchase 145,825 shares of common stock of HC2 Broadcasting Holdings, Inc. common stock held by the lenders of the 10.5% Senior Notes by extending the time to exercise such to the second half of 2026 and reducing the exercise price per share (i) from $140.00 to $0.01 in the case of the certain of the warrants and (ii) from $130.00 to $0.01 in the case of the remaining warrants.
Other expense, net for the year ended December 31, 2022 was primarily comprised of a deemed distribution loss related to a former subsidiary, CGIC, from a tax sharing arrangement and consolidation on the 2021 tax return, and a fair value adjustment to an investment in our Life Sciences segment. Refer to Note 10.
Other expense, net for the year ended December 31, 2022 was primarily comprised of a deemed distribution loss of $1.8 million related to a former subsidiary, CGIC, from a tax sharing arrangement and consolidation on the 2021 tax return, and a fair value adjustment to an investment in our Life Sciences segment.
As of December 31, 2022, the Company was in compliance with this covenant.
As of December 31, 2023, the Company was in compliance with this covenant.
Convertible Instruments We evaluate and account for conversion options embedded in convertible instruments in accordance with ASC 815, Derivatives and Hedging Activities . Applicable U.S. Generally Accepted Accounting Principles ("GAAP") requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria.
Convertible Instruments We evaluate and account for conversion options embedded in convertible instruments in accordance with ASC 815, Derivatives and Hedging Activities . Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria.
Revenues relating to changes in the scope of a contract are recognized when we and a customer or general contractor have agreed on both the scope and price of changes, the work has commenced, it is probable that the costs of the changes will be recovered and that realization of revenue exceeding the costs is assured beyond a reasonable doubt.
Revenues relating to changes in the scope of a contract are recognized when we and a customer or general contractor have agreed on both the scope and price of changes, the work has commenced, and that realization of revenue is assured beyond a reasonable doubt.
Factors that could cause actual results, events and developments to differ include, without limitation: the ability of our subsidiaries (including, target businesses following their acquisition) to generate sufficient net income and cash flows to make upstream cash distributions, capital market conditions, our and our subsidiaries’ ability to identify any suitable future acquisition opportunities, efficiencies/cost avoidance, cost savings, income and margins, growth, economies of scale, combined operations, future economic performance, conditions to, and the timetable for, completing the integration of financial reporting of acquired or target businesses with INNOVATE or the applicable subsidiary of INNOVATE, completing future acquisitions and dispositions, litigation, potential and contingent liabilities, management’s plans, changes in regulations and taxes. 63 We claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for all forward-looking statements.
Factors that could cause actual results, events and developments to differ include, without limitation: the ability of our subsidiaries (including, target businesses following their acquisition) to generate sufficient net income and cash flows to make upstream cash distributions, capital market conditions, our and our subsidiaries’ ability to identify any suitable future acquisition opportunities, efficiencies/cost avoidance, cost savings, income and margins, growth, economies of scale, combined operations, future economic performance, conditions to, and the timetable for, completing the integration of financial reporting of acquired or target businesses with INNOVATE or the applicable subsidiary of INNOVATE, completing future acquisitions and dispositions, litigation, potential and contingent liabilities, management’s plans, changes in regulations and taxes.
Summary of Significant Accounting Policies to our Consolidated Financial Statements included in this Annual Report on Form 10-K, which note is incorporated herein by reference. Critical Accounting Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the U.S.
Summary of Significant Accounting Policies of the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference for additional information. Critical Accounting Estimates The preparation of financial statements in accordance with generally accepted accounting principles under U.S.
On December 30, 2022, Broadcasting entered into a Seventh Omnibus Amendment to Secured Notes which, among other things, extended the maturity date of $52.2 million of its Senior Secured Notes, due December 30, 2022 to May 31, 2024.
On December 30, 2022, Broadcasting entered into a Seventh Omnibus Amendment to Secured Notes which, among other things, extended the maturity date of $52.2 million of its Senior Secured Notes, due December 30, 2022 to May 31, 2024. Interest is capitalized and payable upon maturity of the principal.
To the extent it is able to bill in advance of costs incurred, DBMG generates working capital through billings in excess of costs and recognized earnings on uncompleted contracts. DBMG relies on its credit facilities to meet its working capital needs.
DBMG attempts to structure the payment arrangements under its contracts to match costs incurred under the project. To the extent it is able to bill in advance of costs incurred, DBMG generates working capital through billings in excess of costs and recognized earnings on uncompleted contracts. DBMG relies on its credit facilities to meet its working capital needs.
Spectrum: Net loss from our Spectrum segment for the year ended December 31, 2022 increased $0.4 million to $13.3 million from $12.9 million for the year ended December 31, 2021. Adjusted EBITDA from our Spectrum segment for the year ended December 31, 2022 decreased $2.4 million to $4.5 million from $6.9 million for the year ended December 31, 2021.
Spectrum: Net loss from our Spectrum segment for the year ended December 31, 2023 increased $8.9 million to $22.2 million from $13.3 million for the year ended December 31, 2022. Adjusted EBITDA from our Spectrum segment for the year ended December 31, 2023 decreased $2.5 million to $2.0 million from $4.5 million for the year ended December 31, 2022.
Capital Expenditures Capital expenditures for the periods indicated are set forth in the table below (in millions): Years Ended December 31, 2022 2021 Infrastructure $ 16.5 $ 18.3 Life Sciences 0.8 0.5 Spectrum 3.3 5.3 Non-operating Corporate 0.1 — Total $ 20.7 $ 24.1 Indebtedness Non-Operating Corporate 2026 Senior Secured Notes On February 1, 2021, our Non-Operating Corporate segment repaid the 2021 Senior Secured Notes and issued $330.0 million aggregate principal amount of 8.50% senior secured notes due February 1, 2026 (the "2026 Senior Secured Notes").
Capital Expenditures Capital expenditures are set forth in the table below (in millions): Year Ended December 31, 2023 2022 Infrastructure $ 16.6 $ 16.5 Life Sciences 0.5 0.8 Spectrum 1.0 3.3 Non-Operating Corporate 0.3 0.1 Total $ 18.4 $ 20.7 60 Indebtedness Non-Operating Corporate 2026 Senior Secured Notes On February 1, 2021, our Non-Operating Corporate segment repaid the senior secured notes that were due in 2021 and issued $330.0 million aggregate principal amount of 8.50% senior secured notes due February 1, 2026 (the "2026 Senior Secured Notes").
Spectrum Segment Years Ended December 31, 2022 2021 Increase / (Decrease) Revenue $ 38.7 $ 42.0 $ (3.3) Cost of revenue 19.9 17.4 2.5 Selling, general and administrative 15.5 19.1 (3.6) Depreciation and amortization 5.8 6.0 (0.2) Other operating loss 1.3 0.3 1.0 Loss from operations $ (3.8) $ (0.8) $ (3.0) Revenue: Revenue from our Spectrum segment for the year ended December 31, 2022 decreased $3.3 million to $38.7 million from $42.0 million for the year ended December 31, 2021.
Spectrum Segment Year Ended December 31, 2023 2022 Increase / (Decrease) Revenue $ 22.5 $ 38.7 $ (16.2) Cost of revenue 11.8 19.9 (8.1) Selling, general and administrative 9.0 15.5 (6.5) Depreciation and amortization 5.2 5.8 (0.6) Other operating (income) loss (0.1) 1.3 (1.4) Loss from operations $ (3.4) $ (3.8) $ 0.4 Revenue: Revenue for the year ended December 31, 2023 decreased $16.2 million to $22.5 million from $38.7 million for the year ended December 31, 2022.
Life Sciences Segment Years Ended December 31, 2022 2021 Increase / (Decrease) Revenue $ 4.3 $ 3.5 $ 0.8 Cost of revenue 3.5 2.5 1.0 Selling, general and administrative 20.6 20.7 (0.1) Depreciation and amortization 0.3 0.2 0.1 Loss from operations $ (20.1) $ (19.9) $ (0.2) Revenue : Revenue for the year ended December 31, 2022 increased $0.8 million to $4.3 million from $3.5 million for the year ended December 31, 2021.
Life Sciences Segment Year Ended December 31, 2023 2022 Increase / (Decrease) Revenue $ 3.3 $ 4.3 $ (1.0) Cost of revenue 2.6 3.5 (0.9) Selling, general and administrative 15.2 20.6 (5.4) Depreciation and amortization 0.5 0.3 0.2 Loss from operations $ (15.0) $ (20.1) $ 5.1 Revenue : Revenue for the year ended December 31, 2023 decreased $1.0 million to $3.3 million from $4.3 million for the year ended December 31, 2022.
As a result of the exclusions, Adjusted EBITDA should not be considered in isolation and does not purport to be an alternative to net income (loss) or other U.S. GAAP financial measures as a measure of our operating performance. Adjusted EBITDA excludes the results of operations and any consolidating eliminations of our previous Insurance segment.
As a result of the exclusions, Adjusted EBITDA should not be considered in isolation and does not purport to be an alternative to net income (loss) or other U.S. GAAP financial measures as a measure of our operating performance.
The other terms of the $19.3 million 8.5% Senior Notes remained the same. At the time of the extension, HC2 Broadcasting had accrued interest and other fees $6.9 million.
The $52.2 million of Senior Secured Notes consisted of $19.3 million of 8.5% Senior Secured Notes and $32.9 million of 10.5% Senior Secured Notes. The other terms of the $19.3 million 8.5% Senior Notes remained the same. At the time of the extension, Broadcasting had accrued interest and other fees of $6.9 million.
The change in the fair value of the warrants was recorded as original issue discount with a corresponding impact reflected in Noncontrolling interest of $3.1 million. 48 Other On December 30, 2022, the Company entered into a letter agreement with Continental General Insurance Company (“CGIC”) pursuant to which CGIC and its affiliates agreed to vote certain shares of the Company’s Series A-3 Convertible Participating Preferred Stock, par value $0.001 per share, and the Company’s Series A-4 Convertible Participating Preferred Stock, par value $0.001 per share, to the extent such shares result in CGIC beneficially owning more than 9.9% of the aggregate voting power of the Company, in the same manner as the majority of the holders holding less than 10% of the Company’s common stock, par value $0.001 per share, vote their shares with respect to any matter pursuant to which such shares are entitled to vote.
Other On December 30, 2022, the Company entered into a letter agreement with CGIC pursuant to which CGIC and its affiliates agreed to vote certain shares of the Company’s Series A-3 Convertible Participating Preferred Stock, par value $0.001 per share, and the Company’s Series A-4 Convertible Participating Preferred Stock, par value $0.001 per share, to the extent such shares result in CGIC beneficially owning more than 9.9% of the aggregate voting power of the Company, in the same manner as the majority of the holders holding less than 10% of the Company’s common stock, par value $0.001 per share, vote their shares with respect to any matter pursuant to which such shares are entitled to vote.
As of December 31, 2022, our Non-Operating Corporate segment's stand-alone indebtedness consists of the $330.0 million aggregate principal amount of 2026 Senior Secured Notes, $51.8 million aggregate principal amount of 2026 Convertible Notes, and $20.0 million aggregate principal amount drawn on its Revolving Credit Agreement.
As of December 31, 2023, our Non-Operating Corporate segment's stand-alone indebtedness consists of the $330.0 million aggregate principal amount of 2026 Senior Secured Notes, $51.8 million aggregate principal amount of 2026 Convertible Notes, $35.1 million principal amount CGIC Unsecured Note and $20.0 million aggregate principal amount drawn on the Revolving Line of Credit.
Adjusted EBITDA loss from our Life Sciences segment for the year ended December 31, 2022 decreased $2.2 million to $25.4 million from $27.6 million for the year ended December 31, 2021.
Adjusted EBITDA loss from our Life Sciences segment for the year ended December 31, 2023 decreased $2.3 million to $23.1 million from $25.4 million for the year ended December 31, 2022.
Non-operating Corporate: Net loss from our Non-operating Corporate segment for the year ended December 31, 2022 decreased $28.9 million to $35.3 million from $64.2 million for the year ended December 31, 2021.
Non-Operating Corporate: Net loss from our Non-Operating Corporate segment for the year ended December 31, 2023 decreased $2.1 million to $33.2 million from $35.3 million for the year ended December 31, 2022.
Revenue recognition begins when work has commenced. Costs include all direct material and labor costs related to contract performance, subcontractor costs, indirect labor, and fabrication plant overhead costs, which are charged to contract costs as incurred.
Costs include all direct material and labor costs related to contract performance, subcontractor costs, indirect labor, and fabrication plant overhead costs, which are charged to contract costs as incurred.
Financial Presentation Background In the below section within this Management’s Discussion and Analysis of Financial Condition and Results of Operations, we compare, pursuant to U.S.
Refer to Note 16. Temporary Equity and Equity for additional information. Financial Presentation Background In the below section within this Management’s Discussion and Analysis of Financial Condition and Results of Operations, we compare, pursuant to U.S.
INNOVATE Corp. and Subsidiaries Our actual results or other outcomes may differ from those expressed or implied by forward-looking statements contained herein due to a variety of important factors, including, without limitation, the following: • our dependence on distributions from our subsidiaries to fund our operations and payments on our obligations; • the impact on our business and financial condition of our substantial indebtedness and the significant additional indebtedness and other financing obligations we may incur; • the impact of covenants in the Indenture governing INNOVATE’s 2026 Senior Secured Notes, 2026 Convertible Notes, and Revolving Credit Agreement, the Certificates of Designation governing INNOVATE’s Preferred Stock and all other subsidiary debt obligations as summarized in Note 13.
As a result, you should consider all of the following factors, together with all of the other information presented herein, in evaluating our business and that of our subsidiaries. 67 INNOVATE Corp. and Subsidiaries Our actual results or other outcomes may differ from those expressed or implied by forward-looking statements contained herein due to a variety of important factors, including, without limitation, the following: • the recent passing of our Chief Executive Officer, President and Director and the successful transition of his management responsibilities; • our dependence on distributions from our subsidiaries to fund our operations and payments on our obligations; • the impact on our business and financial condition of our substantial indebtedness and the significant additional indebtedness and other financing obligations we may incur; • the impact of covenants in the Indenture governing INNOVATE’s 2026 Senior Secured Notes, 2026 Convertible Notes, CGIC Unsecured Note and Revolving Credit Agreement, the Certificates of Designation governing INNOVATE’s Preferred Stock and all other subsidiary debt obligations as summarized in Note 11.
Adjusted EBITDA loss from our Non-operating Corporate segment for the year ended December 31, 2022 decreased $1.3 million to $16.7 million from $18.0 million for the year ended December 31, 2021.
Adjusted EBITDA loss from our Non-Operating Corporate segment for the year ended December 31, 2023 decreased $3.2 million to $13.5 million from $16.7 million for the year ended December 31, 2022.
Income tax expense : Income tax expense for the year ended December 31, 2022 decreased $4.7 million to $0.9 million from $5.6 million for the years ended December 31, 2021.
Income tax expense : Income tax expense for the year ended December 31, 2023 increased $3.6 million to $4.5 million from $0.9 million for the year ended December 31, 2022.
Other operating loss : Other operating loss for the year ended December 31, 2022 increased $1.0 million to $1.3 million from $0.3 million for the year ended December 31, 2021.
Other operating loss: Other operating loss for the year ended December 31, 2023 increased to $0.5 million from zero for the year ended December 31, 2022.
The UMB Revolving Line associated with our Infrastructure segment contains customary restrictive and financial covenants related to debt levels and performance, including a Fixed Coverage Ratio covenant, as defined in the agreement.
The UMB Term Loan and UMB Revolving Line associated with our Infrastructure segment contains customary restrictive and financial covenants related to debt levels and performance, including a Fixed Charge Coverage Ratio covenant, as defined in the agreement. 63 As of December 31, 2023, we were in compliance with the covenants of our debt agreements.
As of December 31, 2022, the Company had $80.4 million of cash and cash equivalents, excluding restricted cash, compared to $45.5 million as of December 31, 2021. On a stand-alone basis, as of December 31, 2022, the Non-Operating Corporate segment had cash and cash equivalents, excluding restricted cash, of $9.1 million compared to $22.0 million at December 31, 2021.
On a stand-alone basis, as of December 31, 2023, our Non-Operating Corporate segment had cash and cash equivalents, excluding restricted cash, of $2.5 million compared to $9.1 million at December 31, 2022.
Related Party Transactions For a discussion of our Related Party Transactions, refer to Note 19. Related Parties to our Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
Related Parties to our Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
Debt Obligations to the Consolidated Financial Statements included elsewhere in this Annual Report on the Form 10-K for additional details regarding the indebtedness of our Infrastructure segment, which is incorporated herein by reference.
Debt Obligations of the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference.
Life Sciences: Net loss from our Life Sciences segment for the year ended December 31, 2022 decreased $0.6 million to $19.2 million from $19.8 million for the year ended December 31, 2021.
Life Sciences: Net loss from our Life Sciences segment for the year ended December 31, 2023 decreased $3.7 million to $15.5 million from $19.2 million for the year ended December 31, 2022.
Infrastructure Segment As of December 31, 2022, DBMG's backlog was $1,782.3 million, consisting of $1,536.3 million under contracts or purchase orders and $246.0 million under letters of intent or notices to proceed. Approximately $927.2 million, representing 52.0% of DBMG’s backlog as of December 31, 2022, was attributable to five contracts, letters of intent, notices to proceed or purchase orders.
Infrastructure Segment As of December 31, 2023, DBMG's backlog was $1,057.2 million, consisting of $1,032.9 million under contracts or purchase orders and $24.3 million under letters of intent or notices to proceed. Approximately $487.3 million, representing 46.1% of DBMG’s backlog as of December 31, 2023, was attributable to five contracts, letters of intent, notices to proceed or purchase orders.
The interest rate on the $32.9 million 10.5% Senior Notes was increased to 11.45% and accrued interest and fees of $17.5 million were capitalized into the principal balance with the transaction accounted for as a debt modification event. The new effective interest rates on the notes range from 12.8% to 19.6%. All other terms were essentially the same.
The interest rate on the $32.9 million 10.5% Senior Notes was increased to 11.45% and cumulative accrued interest and exit fees of $17.5 million were capitalized into the principal balance with both note extensions accounted for as debt modification events. All other terms were essentially the same.
The interest rate on the $32.9 million 10.5% Senior Notes was increased to 11.45% and accrued interest and fees of $17.5 million were capitalized into the principal balance with the transaction accounted for as a debt modification event. The new effective interest rates on the notes range from 12.8% to 19.6%. All other terms were essentially the same.
The interest rate on the $32.9 million 10.5% Senior Notes was increased to 11.45% and cumulative accrued interest and exit fees of $17.5 million were capitalized into the principal balance with both note extensions accounted for as debt modification events. All other terms were essentially the same.
Adjusted EBITDA from our Other segment for the year ended December 31, 2022 decreased $0.2 million to $4.0 million from $4.2 million for the year ended December 31, 2021.
Adjusted EBITDA from our Other segment for the year ended December 31, 2023 decreased $5.0 million to an Adjusted EBITDA loss of $1.0 million from Adjusted EBITDA income of $4.0 million for the year ended December 31, 2022.
Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference. Infrastructure As of December 31, 2022, our Infrastructure segment had an aggregate principal amount of outstanding debt of $243.0 million.
Debt Obligations of the Consolidated Financial Statements included in this Annual Report on Form 10-K which is incorporated herein by reference, for additional details regarding the indebtedness of our Infrastructure segment. Life Sciences As of December 31, 2023, our Life Sciences segment has aggregate principal outstanding debt of $17.4 million.
You should also understand that many factors described under one heading below may apply to more than one section in which we have grouped them for the purpose of this presentation. As a result, you should consider all of the following factors, together with all of the other information presented herein, in evaluating our business and that of our subsidiaries.
You should also understand that many factors described under one heading below may apply to more than one section in which we have grouped them for the purpose of this presentation.
Infrastructure Segment Years Ended December 31, 2022 2021 Increase / (Decrease) Revenue $ 1,594.3 $ 1,159.7 $ 434.6 Cost of revenue 1,392.5 1,001.6 390.9 Selling, general and administrative 123.9 103.5 20.4 Depreciation and amortization 21.0 19.1 1.9 Other operating (income) loss (0.6) 0.3 (0.9) Income from operations $ 57.5 $ 35.2 $ 22.3 Revenue: Revenue for the year ended December 31, 2022 increased $434.6 million to $1,594.3 million from $1,159.7 million for the year ended December 31, 2021.
Infrastructure Segment Year Ended December 31, 2023 2022 Increase / (Decrease) Revenue $ 1,397.2 $ 1,594.3 $ (197.1) Cost of revenue 1,192.6 1,392.5 (199.9) Selling, general and administrative 126.0 123.9 2.1 Depreciation and amortization 14.4 21.0 (6.6) Other operating income (0.2) (0.6) 0.4 Income from operations $ 64.4 $ 57.5 $ 6.9 Revenue: Revenue for the year ended December 31, 2023 decreased $197.1 million to $1,397.2 million from $1,594.3 million for the year ended December 31, 2022.
(Loss) Income from Equity Investees Years Ended December 31, 2022 2021 Increase / (Decrease) Life Sciences $ (6.2) $ (8.1) $ 1.9 Other 4.9 5.3 (0.4) (Loss) from equity investees $ (1.3) $ (2.8) $ 1.5 Life Sciences: Loss from equity investees within our Life Sciences segment for the year ended December 31, 2022 decreased $1.9 million to $6.2 million from $8.1 million for the year ended December 31, 2021.
Other operating loss in 2023 consisted primarily of an impairment of leasehold improvements for unutilized office space. 55 (Loss) Income from Equity Investees Year Ended December 31, 2023 2022 Increase / (Decrease) Life Sciences $ (9.1) $ (6.2) $ (2.9) Other (0.3) 4.9 (5.2) Loss from equity investees $ (9.4) $ (1.3) $ (8.1) Loss from equity investees: Life Sciences: Loss from equity investees within our Life Sciences segment for the year ended December 31, 2023 increased $2.9 million to $9.1 million from $6.2 million for the year ended December 31, 2022.
Each table summarizes the results of operations of our operating segments and compares the amount of the change between the periods presented (in millions).
Each table summarizes the results of operations of our operating segments (in millions).
Our selection and disclosure of our critical accounting policies and estimates has been reviewed with our Audit Committee. Following is a review of the more significant assumptions and estimates used in the preparation of our consolidated financial statements. For all of these estimates, we caution that future events rarely develop exactly as forecast, and the best estimates routinely require adjustment.
Our selection and disclosure of our critical accounting policies and estimates has been reviewed with our Audit Committee. The following is a review of the more significant assumptions and estimates used in the preparation of our consolidated financial statements.
In November 2022, MediBeacon amended its existing agreements with Huadong, which will provide approximately $10 million in funding by June 30, 2023, including $7.5 million or 50% of the remaining $15 million milestone investment due upon FDA approval of MediBeacon's TGFR at a pre-money valuation of approximately $400 million.
Ltd ("Huadong"), to provide approximately $10 million in the first half of 2023, including $7.5 million or 50% of the remaining $15 million milestone investment due upon FDA approval of MediBeacon's TGFR at a pre-money valuation of approximately $400 million.
The judgments and estimates made at a point in time may change based on the outcome of tax audits, expiration of statutes of limitations, as well as changes to, or further interpretations of, tax laws and regulations. 62 In relation to tax effects for accumulated OCI, our policy is to release the tax effects of amounts reclassified from accumulated OCI to pre-tax income (loss) from continuing operations.
The judgments and estimates made at a point in time may change based on the outcome of tax audits, expiration of statutes of limitations, as well as changes to, or further interpretations of, tax laws and regulations.
Adjusted EBITDA from our Infrastructure segment for the year ended December 31, 2022 increased $23.3 million to $101.7 million from $78.4 million for the year ended December 31, 2021.
Adjusted EBITDA from our Infrastructure segment for the year ended December 31, 2023 decreased $1.1 million to $100.6 million from $101.7 million for the year ended December 31, 2022.
Summary of Significant Accounting Policies to our Consolidated Financial Statements included in this Annual Report on Form 10-K, which discusses our significant accounting policies and is incorporated herein by reference. 61 Revenue Recognition - Estimated Costs to Complete With respect to our Infrastructure segment (DBM Global Inc.), we recognize a significant portion of our revenue over time using the input method to measure the progress of costs incurred for our service and construction contracts.
Revenue Recognition - Estimated Costs to Complete With respect to our Infrastructure segment (DBM Global Inc.), we recognize a significant portion of our revenue over time using the input method to measure the progress of costs incurred for our service and construction contracts.
DBMG believes that its existing borrowing availability together with cash from operations will be adequate to meet all funding requirements for its operating expenses, interest payments on debt and capital expenditures for the foreseeable future.
DBMG believes that its available funds, cash generated by operating activities and funds available under its bank credit facilities will be adequate to meet all funding requirements for its operating expenses, working capital needs, interest payments on debt and capital expenditures for the foreseeable future.
Revolving Credit Agreement We have a revolving credit agreement with MSD PCOF Partners IX, LLC ("Revolving Credit Agreement"). The Revolving Credit Agreements has a maximum commitment of $20.0 million, all of which had been drawn as of December 31, 2022.
Revolving Credit Agreement We have a revolving credit agreement with MSD PCOF Partners IX, LLC ("MSD") which has a maximum commitment of $20.0 million ("Revolving Line of Credit"), of which $20.0 million had been drawn as of December 31, 2023. Interest on loans under the Revolving Line of Credit accrues at SOFR plus 5.75% and is payable quarterly.
Other (expense) income, net: Other (expense) income, net for the year ended December 31, 2022 decreased $5.5 million to an expense of $1.2 million from income of $4.3 million for the year ended December 31, 2021.
Other income (expense), net: Other income (expense), net for the year ended December 31, 2023 increased $17.9 million to income of $16.7 million from other expense of $1.2 million for the year ended December 31, 2022.
The Plan is intended to help protect the Company's ability to use its tax net operating losses and other certain tax assets ("Tax Benefits") by deterring an "ownership change," as defined under Section 382 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder (the "Code"), by a person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more of the outstanding common shares.
The 2023 Preservation Plan is intended to help protect the Company's ability to use its tax net operating losses and other certain tax assets ("Tax Benefits") by deterring an "ownership change," as defined under Section 382 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder (the "Code"), by a person or group of affiliated or associated persons from acquiring beneficial ownership of 4.9% or more of the outstanding common shares. 51 In connection with entering into the Plan, on April 1, 2023 the Board of Directors of the Company declared a dividend distribution of one right (a “Right”) for each outstanding share of common stock, par value $0.001 per share, of the Company (the “Common Stock”) to stockholders of record at the close of business on April 10, 2023 (the “Record Date”).
Acquisitions The Company’s acquisitions are accounted for using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date.
Income Taxes to our Consolidated Financial Statements included in this Annual Report on Form 10-K for further information, which is incorporated herein by reference. Acquisitions The Company’s acquisitions are accounted for using the acquisition method of accounting, which requires, among other things, that assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date.
The customer receives value over the term of the project based on the amount of work that has been completed towards the delivery of the completed project. The most reliable measure of progress is the cost incurred towards delivery of the completed project. Therefore, the input method provides the most reliable method to measure progress.
The most reliable measure of progress is the cost incurred towards delivery of the completed project. Therefore, the input method provides the most reliable method to measure progress. Revenue recognition begins when work has commenced.
Debt Obligations to the Consolidated Financial Statements included in this Annual Report on Form 10-K, which is incorporated herein by reference. 57 Our debt contains customary events of default which could, subject to certain conditions, cause the 2026 Senior Secured Notes and the 2026 Convertible Notes to become immediately due and payable.
Our debt contains customary events of default which could, subject to certain conditions, cause the 2026 Senior Secured Notes and the 2026 Convertible Notes to become immediately due and payable.
At this time, we believe that we will be able to continue to meet our liquidity requirements and fund our fixed obligations (such as debt service and lease commitments) and other cash needs for our operations for at least the next twelve months from the issuance of the Consolidated Financial Statements through a combination of available cash and distributions from our subsidiaries.
For more information regarding the back-stop and private placement commitments from Lancer Capital under the Investment Agreement, see “Recent Developments.” At this time, management believes that the Company will be able to continue to meet its liquidity requirements and fund its fixed obligations (such as debt service and operating leases) and other cash needs for its operations for at least the next twelve months from the issuance of the Consolidated Financial Statements through a combination of available cash on hand, distributions from the Company’s subsidiaries and the rights offering together with the back-stop and private placement commitments from Lancer Capital under the Investment Agreement.
For additional information on the terms and conditions of the 2026 Convertible Notes, including optional redemption, conversion rights guarantees, ranking and collateral, refer to Note 13.
For additional information on the terms and conditions of the 2026 Convertible Notes, including optional redemption, conversion rights guarantees, ranking and collateral, refer to Note 11. Debt Obligations included in this Annual Report on Form 10-K, which is incorporated herein by reference.
Income (loss) from operations : Income from operations for the year ended December 31, 2022 increased $24.0 million to income of $13.4 million from a loss of $10.6 million for the year ended December 31, 2021.
Income from operations : Income from operations for the year ended December 31, 2023, increased $13.1 million to $26.5 million from $13.4 million for the year ended December 31, 2022.

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