SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of contract assets (unbilled receivables) and contract liabilities (customer advances and unearned income and unearned event income)

Contract assets and contract liabilities that are not separately stated in our consolidated balance sheets at December 31, 2022 and 2021 were as follows:


	December 31, 2022		December 31, 2021
			(As Restated)
	(In thousands)
Contract assets:
Unbilled receivables ($5,798 as of January 1, 2021)	$	12,597	$	10,735

Contract liabilities:
Customer advances and unearned income ($3,044 as of January 1, 2021)	$	6,123	$	5,503
Reserve for audience deficiency ($3,544 as of January 1, 2021)		9,629		6,020
Unearned event income ($5,921 as of January 1, 2021)		5,708		—

Schedule of future estimated launch support amortization expense

Future estimated launch support amortization related to launch assets for years 2023 through 2027 and thereafter is as follows:


	(In thousands)
2023	$	4,980
2024		4,980
2025		4,980
2026		3,410
2027		237
Thereafter		73

Schedule of fair values of our financial assets and liabilities measured at fair value on a recurring basis

As of December 31, 2022 and 2021, respectively, the fair values of our financial assets and liabilities measured at fair value on a recurring basis are categorized as follows:


	Total		Level 1		Level 2		Level 3

	(In thousands)
As of December 31, 2022
Liabilities subject to fair value measurement:
Employment agreement award (a)	$	26,283	$	—	$	—	$	26,283

Mezzanine equity subject to fair value measurement:
Redeemable noncontrolling interests (b)	$	25,298	$	—	$	—	$	25,298

Assets subject to fair value measurement:
Available-for-sale securities (c)	$	136,826	$	—	$	—	$	136,826
Cash equivalents - money market funds (d)		39,798		39,798		—		—
Total	$	176,624	$	39,798	$	—	$	136,826

As of December 31, 2021 (As Restated)
Liabilities subject to fair value measurement:
Employment agreement award (a)	$	28,193	$	—	$	—	$	28,193

Mezzanine equity subject to fair value measurement:
Redeemable noncontrolling interests (b)	$	18,655	$	—	$	—	$	18,655

Assets subject to fair value measurement:
Available-for-sale securities (c)	$	112,600	$	—	$	—	$	112,600

(a)

Each quarter, pursuant to an employment agreement (the “Employment Agreement”) executed in April 2008, the Chief Executive Officer (“CEO”) is eligible to receive an award (the “Employment Agreement Award”) in an amount equal to approximately 4% of any proceeds from distributions or other liquidity events in excess of the return of the Company’s aggregate investment in TV One. The Company reviews the factors underlying this award at the end of each quarter including the valuation of TV One (based on the estimated enterprise fair value of TV One as determined by the income approach using a discounted cash flow analysis and the market approach using comparable public company multiples). The Company’s obligation to pay the award was triggered after the Company recovered the aggregate amount of capital contributions in TV One, and payment is required only upon actual receipt of distributions of cash or marketable securities or proceeds from a liquidity event with respect to such invested amount. The long-term portion of the award is recorded in other long-term liabilities and the current portion is recorded in other current liabilities in the consolidated balance sheets. The CEO was fully vested in the award upon execution of the Employment Agreement, and the award lapses if the CEO voluntarily leaves the Company or is terminated for cause. Significant inputs to the discounted cash flow analysis include revenue growth rates, future operating profit margins, discount rate and terminal growth rate. Significant inputs to the market approach include publicly held peer companies and associated multiples. In September 2022, the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”) approved terms for a new employment agreement with the CEO, including a renewal of the Employment Agreement Award upon similar terms as in the prior Employment Agreement.

(b)	The redeemable noncontrolling interest in Reach Media is measured at fair value using a discounted cash flow methodology. Significant inputs to the discounted cash flow analysis include revenue growth rates, future operating profit margins, discount rate and terminal growth rate.

(c)

The investment in MGM National Harbor is preferred stock that has a non-transferable put right and is classified as an available-for-sale debt security. The investment was initially measured at fair value using a dividend discount model. Significant inputs to the dividend discount model include revenue growth rates, discount rate and a terminal growth rate. As of December 31, 2022, the investment’s fair value is measured using a contractual valuation approach.

This method relies on a contractually agreed upon formula established between the Company and MGM National Harbor as defined in the Second Amended and Restated Operating Agreement of MGM National Harbor, LLC (“the Agreement”) rather than market-based inputs or traditional valuation methods. As defined in the Agreement, the calculation of the put is based on operating results, Enterprise Value and the Put Price Multiple. The inputs used in this measurement technique are specific to the entity, MGM National Harbor, and there are no current observable prices for investments in private companies that are comparable to MGM National Harbor. The inputs used to measure the fair value of this security are classified as Level 3 within the fair value hierarchy. Throughout the periods from the fourth quarter of 2020 up until the third quarter of 2022, the Company relied on the dividend discount model for valuation purposes based on the facts, circumstances, and information available at the time. During the fourth quarter of 2022, the Company adopted the contractual valuation method described above as it believes it more closely approximates the fair value of the investment at that time. Please refer to Note 18 – Subsequent Events of our consolidated financial statements for further details.

(d)	The Company measures and reports its cash equivalents that are invested in money market funds at estimated fair value.

Schedule of significant unobservable input value

For Level 3 assets and liabilities measured at fair value on a recurring basis, the significant unobservable inputs used in the fair value measurements were as follows:


			As of		As of
			December 31,		December 31,
			2022		2021
					(As Restated)
		Significant
		Unobservable	Significant Unobservable
Level 3 assets and liabilities	Valuation Technique	Inputs	Input Value
Employment agreement award	Discounted cash flow	Discount rate	10.5	%	9.5	%
Employment agreement award	Discounted cash flow	Terminal growth rate	0.5	%	0.5	%
Employment agreement award	Discounted cash flow	Operating profit margin range	33.7% - 46.6	%	34.9% - 46.4	%
Employment agreement award	Discounted cash flow	Revenue growth rate range	(4.1)% - 4.2	%	(5.9)% - 11.6	%
Redeemable noncontrolling interest	Discounted cash flow	Discount rate	11.5	%	11.5	%
Redeemable noncontrolling interest	Discounted cash flow	Terminal growth rate	0.3	%	0.4	%
Redeemable noncontrolling interest	Discounted cash flow	Operating profit margin range	25.8% - 29.8	%	24.0% - 32.8	%
Redeemable noncontrolling interest	Discounted cash flow	Revenue growth rate range	0.2% - 32.2	%	(11.8)% - 0.3	%
Available-for-sale securities	Dividend discount model	Revenue growth rate	N/A		8.0	%
Available-for-sale securities	Dividend discount model	Discount rate	N/A		10.5	%
Available-for-sale securities	Dividend discount model	Long-term growth rate	N/A		3.0	%

Schedule of maturities of lease liabilities


For the Year Ended December 31,	(In thousands)
2023	$	11,697
2024		10,690
2025		6,834
2026		4,860
2027		3,417
Thereafter		7,140
Total future lease payments		44,638
Less: imputed interest		(10,403)
Total	$	34,235