PART I.
Item 1. Business
General Development of Business
Atlanta Braves Holdings, Inc. (“Atlanta Braves Holdings,” “the Company,” “us,” “we,” or “our”) is primarily comprised of Braves Holdings, LLC (“Braves Holdings”), a wholly-owned subsidiary, and corporate cash.
During November 2022, the board of directors of Liberty Media Corporation (“Liberty” or “Liberty Media”) authorized Liberty management to pursue a plan to redeem each outstanding share of its Liberty Braves common stock in exchange for one share of the corresponding series of common stock of a newly formed entity, Atlanta Braves Holdings (the “Split-Off”). The Split-Off was completed on July 18, 2023 and was intended to be tax-free to holders of Liberty Braves common stock. Atlanta Braves Holdings is comprised of the businesses, assets and liabilities previously attributed to the Liberty Braves Group (“Braves Group”), which, as of December 31, 2023, included Atlanta Braves Holdings’ wholly-owned subsidiary Braves Holdings and corporate cash.
The intergroup interests in the Braves Group held by the Liberty Formula One Group (the “Formula One Group”) and the Liberty SiriusXM Group immediately prior to the Split-Off were settled and extinguished in connection with the Split-Off through the attribution, to the respective tracking stock group, of Atlanta Braves Holdings Series C common stock on a one-for-one basis equal to the number of notional shares representing the intergroup interest. In November 2023, Liberty exchanged 1,811,066 shares of Atlanta Braves Holdings Series C common stock with a third party in satisfaction of certain of Liberty’s debt obligations, and an affiliate of such third party then sold the shares in a secondary public offering (the “Liberty Media Exchange”). Atlanta Braves Holdings did not receive any of the proceeds from the Liberty Media Exchange. Following this transaction, neither Liberty nor Atlanta Braves Holdings has any continuing stock ownership, beneficial or otherwise, in the other.
In connection with the Split-Off, Liberty and Atlanta Braves Holdings entered into certain agreements in order to govern certain of the ongoing relationships between the two companies after the Split-Off and to provide for an orderly transition. These agreements include a reorganization agreement, a services agreement, aircraft time sharing agreements, a facilities sharing agreement, a tax sharing agreement and a registration rights agreement.
The reorganization agreement provides for, among other things, the principal corporate transactions (including the internal restructuring) required to effect the Split-Off, certain conditions to the Split-Off and provisions governing the relationship between Atlanta Braves Holdings and Liberty with respect to and resulting from the Split-Off. The tax sharing agreement provides for the allocation and indemnification of tax liabilities and benefits between Liberty and Atlanta Braves Holdings and other agreements related to tax matters. Pursuant to the services agreement, Liberty provides Atlanta Braves Holdings with general and administrative services including legal, tax, accounting, treasury, information technology, cybersecurity and investor relations support. Atlanta Braves Holdings will reimburse Liberty for direct, out-of-pocket expenses and will pay a services fee to Liberty under the services agreement that is subject to adjustment quarterly, as necessary. Additionally, pursuant to the services agreement with Liberty, components of Liberty Chief Executive Officer’s compensation will either be paid directly to him or reimbursed to Liberty, in each case, based on allocations set forth in the amended services agreement, which was set at 7% for the Company but subject to adjustment on an annual basis and upon the occurrence of certain events.
Under the facilities sharing agreement, Atlanta Braves Holdings shares office space with Liberty and related amenities at Liberty’s corporate headquarters. The aircraft time sharing agreements provide for Liberty to lease certain aircraft that it or its subsidiaries own to Atlanta Braves Holdings for use on a periodic, non-exclusive time sharing basis.
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Cautionary Note Regarding Forward-Looking Statements
Certain statements in this Annual Report on Form 10-K constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding business, product and marketing strategies; new service offerings; the recoverability of our goodwill and other long-lived assets; our projected sources and uses of cash; and the anticipated impact of certain contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. In particular, statements under Item 1. "Business," Item 1A. "Risk Factors," Item 2. "Properties," Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Item 7A. "Quantitative and Qualitative Disclosures About Market Risk" contain forward-looking statements. Forward-looking statements inherently involve many risks and uncertainties that could cause actual results to differ materially from those projected in these statements. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but such statements necessarily involve risks and uncertainties and there can be no assurance that the expectation or belief will result or be achieved or accomplished. The following include some but not all of the factors that could cause actual results or events to differ materially from those anticipated:
| ● | the Company’s historical financial information is not necessarily representative of its future financial position, future results of operations or future cash flows; |
| ● | the Company’s ability to recognize anticipated benefits from the Split-Off; |
| ● | the incurrence of costs as a standalone public company following the Split-Off; |
| ● | the Company’s ownership, management and board of directors structure; |
| ● | the Company’s ability to obtain additional financing on acceptable terms and cash in amounts sufficient to service debt and other financial obligations; |
| ● | the Company’s indebtedness could adversely affect operations and could limit its ability to react to changes in the economy or its industry; |
| ● | the Company’s ability to realize the benefits of acquisitions or other strategic investments; |
| ● | the impact of inflation and weak economic conditions on consumer demand for products, services and events offered by the Company; |
| ● | the outcome of pending or future litigation or investigations; |
| ● | the operational risks of the Company and its business affiliates with operations outside of the United States; |
| ● | the Company’s ability to use net operating loss and disallowed business interest carryforwards to reduce future tax payments; |
| ● | the ability of the Company and its affiliates to comply with government regulations, including, without limitation, consumer protection laws and competition laws, and adverse outcomes from regulatory proceedings; |
| ● | the regulatory and competitive environment of the industries in which the Company operates; |
| ● | changes in the nature of key strategic relationships with partners, vendors and joint venturers; |
| ● | the achievement of on-field success; |
| ● | the Company’s ability to develop, obtain and retain talented players; |
| ● | the impact of organized labor on the Company; |
| ● | the impact of the structure or an expansion of Major League Baseball (“MLB”); |
| ● | the level of broadcasting revenue that Braves Holdings receives; |
| ● | the impact of the Mixed-Use Development (defined below) on the Company and its ability to manage the project; |