Emerald Holding(EEX) - 2025 Q4 - Annual Report

Acquisition and Industry Presence - The acquisition of MJBiz was completed on December 31, 2021, enhancing the company's presence in the cannabis industry through its publication MJBiz Daily and the annual MJBizCon event [87]. - The company may face regulatory, financial, and operational risks associated with its connection to the cannabis industry through MJBiz, despite not directly engaging in cannabis sales [87]. Financial Performance and Risks - The company is exposed to foreign exchange rate fluctuations, particularly with currencies like the U.K. Pound Sterling, which may impact financial performance [86]. - The company has experienced increased event cancellation insurance premiums and higher deductibles due to a history of claims related to COVID-19 and natural disasters [95]. - The company has identified material weaknesses in internal control over financial reporting, which could affect the accuracy of financial results and investor confidence [99]. - Remediation efforts for previously identified material weaknesses have been costly and time-consuming, focusing on enhancing control activities related to preferred stock accounting [100]. - The company maintains various insurance policies, but these may not cover all risks associated with business operations, potentially leading to material adverse effects on financial condition [95]. - The company faces risks associated with event cancellations or interruptions, which may not be fully covered by insurance [95]. - The company faces risks related to its high level of indebtedness, which could limit its ability to raise additional capital and increase vulnerability to adverse economic conditions [107]. - Changes in income tax rates and regulations, including the Inflation Reduction Act and the One Big Beautiful Bill Act, may affect the company's future financial results [104]. - The company recorded intangible asset impairment charges of $7.3 million, with potential for further impairment charges in future periods [102]. - The stock price has experienced significant fluctuations, which may continue due to various factors beyond the company's control [124]. Operational and Management Challenges - The company relies on digital media and print publications to engage with event audiences, and failure to generate relevant content could negatively impact revenues [90]. - The company has long-term sponsorship agreements with industry associations that are crucial for marketing trade shows, and disruptions in these relationships could adversely affect business [93]. - The company relies on key management personnel, and their loss could negatively impact business operations [105]. - The company is currently reviewing and updating its information technology systems to enhance data analytics capability, which may consume time and resources [116]. - The company relies on license agreements for certain trade shows and events, and disruptions in these relationships could adversely impact revenue streams [120]. - The company faces risks related to the infringement of proprietary rights, which could materially affect its business operations [121]. - The use of AI technologies in the company's operations may lead to reputational harm and financial costs if not managed properly [122]. Governance and Shareholder Rights - Onex owns approximately 93.3% of the company's outstanding common stock, allowing it to control major corporate decisions [126]. - Future stock issuances could negatively impact the market price of the company's common stock [128]. - The company has reintroduced a quarterly dividend of $0.015 per share, with payments subject to board discretion and financial conditions [137]. - The company is a holding entity with no operations of its own, relying on dividends and distributions from subsidiaries [140]. - The ability of subsidiaries to pay dividends is subject to local laws and contractual arrangements, including indebtedness [140]. - Delaware law may impose restrictions on the company's ability to pay dividends to common stockholders [140]. - The board of directors is divided into three classes with staggered three-year terms [139]. - Stockholders can only remove directors "for cause" once Onex owns less than 50% of outstanding common stock [139]. - Stockholders are prohibited from calling special meetings once Onex owns less than 50% of outstanding common stock [139]. - Stockholder actions by written consent are prohibited once Onex owns less than 50% of outstanding common stock [139]. - The board is authorized to adopt, alter, or repeal the second amended and restated bylaws [139]. - The Court of Chancery of the State of Delaware will be the exclusive forum for disputes between the company and stockholders [139]. - Approval from at least two-thirds of outstanding shares is required to amend certain bylaws if Onex ceases to own more than 50% of outstanding common stock [139].